{"id":4391,"date":"2011-06-16T07:10:04","date_gmt":"2011-06-16T13:10:04","guid":{"rendered":"http:\/\/www.jasonapollovoss.local\/?p=4391"},"modified":"2018-09-21T02:06:01","modified_gmt":"2018-09-21T06:06:01","slug":"intuitive-assessment-of-greek-debt-crisis","status":"publish","type":"post","link":"https:\/\/jasonapollovoss.com\/web\/2011\/06\/16\/intuitive-assessment-of-greek-debt-crisis\/","title":{"rendered":"Intuitive Assessment of Greek Debt Crisis"},"content":{"rendered":"<p><span style=\"font-size: 16px;\">There are currently two crisis pendulums swinging back and forth over the financial markets, threatening to drop the corpus into a deep pit of despair.\u00a0 The first is the U.S. debt crisis which has a certain deadline of 1 July, 2011.\u00a0 Whether that crisis is truly resolved or not I cannot say.\u00a0 The other large crisis is the Greek debt crisis.<\/span><\/p>\n<p><span style=\"font-size: 16px;\">As I have done in the past, here is my intuitive assessment of the Greek debt crisis:<\/span><\/p>\n<ul>\n<li><span style=\"font-size: 16px;\">Right now there is no clearly dominant force in the negotiations.\u00a0 Here I can identify multiple oppositional forces:<\/span>\n<ul>\n<li><span style=\"font-size: 16px;\">Greece vs. Europe<\/span><\/li>\n<li><span style=\"font-size: 16px;\">within Greece I can feel three parties opposed to one another:<\/span>\n<ul>\n<li><span style=\"font-size: 16px;\">the current government vs. insurgents<\/span><\/li>\n<li><span style=\"font-size: 16px;\">and the people of Greece against anything suggested from outside of Greece<\/span><\/li>\n<\/ul>\n<\/li>\n<li><span style=\"font-size: 16px;\">within Europe I can feel four main forces:<\/span>\n<ul>\n<li><span style=\"font-size: 16px;\">France, and its backers<\/span><\/li>\n<li><span style=\"font-size: 16px;\">Germany, mostly on an island<\/span><\/li>\n<li><span style=\"font-size: 16px;\">U.K., and its backers<\/span><\/li>\n<li><span style=\"font-size: 16px;\">European finance and banking authorities<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<li><span style=\"font-size: 16px;\">Importantly, the population of Greece feels arrayed against the rest of Europe.\u00a0 Increasingly this opposition is taking the form of an emotional rejection of Europe, as opposed to a logical or philosophical rejection of Europe.\u00a0 So continued, escalating rioting in Greece seems very likely.<\/span><\/li>\n<li><span style=\"font-size: 16px;\">France, not Germany, feels like the dominant European voice at this time.\u00a0 This makes sense because French and Swiss banks stand to lose the most in the event of a Greek debt default.\u00a0 But this is a shift.\u00a0 Germany has been <em>the voice in Europe<\/em> on the Greek debt crisis dating back to last year.\u00a0 Yet, I feel that France has the dominant position right now.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-size: 16px;\">The above factors all collide into mush.\u00a0 That is, no definitive outcome is able to be sensed intuitively.\u00a0 However, this is still important information.\u00a0 It means that a resolution to the crisis is unlikely in the near term and that there is going to be continued stress exerted on global financial markets.<\/span><\/p>\n<p><span style=\"font-size: 16px;\">One thing that I can feel is that the will of the Greek people feels as if it will collapse in the face of outside European force of will.\u00a0 Tying this intuition to facts makes the situation clearer.<\/span><\/p>\n<p><span style=\"font-size: 16px;\">Greece lived beyond its means for decades because it played the U.S. and Russia against each other in the Cold War, thus receiving large amounts of foreign aid.\u00a0 This aid led to a massive entitlement culture in Greece.\u00a0 Once the Cold War ended Greece could have faced the flame of massively smaller aid injections and adjusted its entitlement economy to a productive, generative economy.\u00a0 But it didn&#8217;t.<\/span><\/p>\n<p><span style=\"font-size: 16px;\">Then Greece entered the EU by lying about its finances and received, you guessed it, more aid.\u00a0 So the reckoning of the hollow economy with reality has been coming for almost two decades.\u00a0 Now the Greek public is furious.\u00a0 But it feels as if they are finally going to have to face the reality that Greece is not the country that it thought it was, and erroneously convinced itself, it was.\u00a0 Ouch!<\/span><\/p>\n<p><span style=\"font-size: 16px;\">In classic European fashion, the majority of pundits in Europe are calling to push back the deadline for doing something from July to September.\u00a0 When in doubt, the Europeans love to do nothing.\u00a0 The Greek debt crisis experienced its initial foment last year and is continuing on as I write this post.\u00a0 So why not push into the future some more the resolution?<\/span><\/p>\n<p><span style=\"font-size: 16px;\">I will continue to monitor the crisis.\u00a0 But right now I am repeating my advice to investors of &#8220;stand on the sidelines&#8221; until the two big crises are resolved (U.S. and Greek).<\/span><\/p>\n<p><span style=\"font-size: 16px;\">Jason<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>There are currently two crisis pendulums swinging back and forth over the financial markets, threatening to drop the corpus into a deep pit of despair.\u00a0 The first is the U.S. debt crisis which has a certain deadline of 1 July, 2011.\u00a0 Whether that crisis is truly resolved or not I cannot say.\u00a0 The other large [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[3,16],"tags":[],"class_list":["post-4391","post","type-post","status-publish","format-standard","hentry","category-the-blog","category-intuitive-assessments"],"_links":{"self":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts\/4391","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/comments?post=4391"}],"version-history":[{"count":0,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/posts\/4391\/revisions"}],"wp:attachment":[{"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/media?parent=4391"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/categories?post=4391"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jasonapollovoss.com\/web\/wp-json\/wp\/v2\/tags?post=4391"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}