[Non-US] News That Makes You laugh/cry/neither...

[CatharzGodfoot]

At this point, we're just talking about #SackOfAthens.

Remember that Greece is just ten million people, they could all die and it wouldn't really be that big of a deal in terms of percentages. The issue is that this gross and deliberate mishandling of Greece exposes the leaders of the world's largest economic bloc as dangerous vindictive fools.

It's worse than a crime. It's a mistake.

-Username17

Pfftt, the USA invaded a country on the basis of them having weapons of mass destruction that were never found, leading to a chain of destructive events leading to a decade and half of neverending conflicts and the forming of a whole country of bloodthirsty fanatics, hundreds of thousands of deads piling up from the direct violence and millions suffering.

And the USA is doing pretty well despite said "mistake" of thinking that Iraq had weapons of mass destruction, nor the mistake of failing to have any actual plan on what exactly to do after conquering liberating that country.

Really, when the pope calls for a holy crusade against the infidels and people start shooting assault rifles on the streets of Europe when not blowing themselves up, then we may start talking about a real mistake having been done.

Hey, we found the WMDs. It's just that Saddam hadn't bothered to pull the 'Made in USA' labels off them.

[Chamomile]

#4thReich seems appropriate, just not for Golden Dawn.

[Maxus]

#4thReich seems appropriate, just not for Golden Dawn.

Maybe someone in Germany has been reading Discworld and thought Ankh-Morpork was doing it right.

"When dragons belch and hippos flee
My thoughts, Ankh-Morpork, are of thee
Let others boast of martial dash
For we have boldly fought with cash
We own all your helmets, we own all your shoes
We own all your generals - touch us and you'll lose.

Morporkia! Morporkia!
Morporkia owns the day!
We can rule you wholesale
Touch us and you'll pay.

We bankrupt all invaders, we sell them souvenirs
We ner ner ner ner ner, hner ner hner by the ears
Er hner we ner ner ner ner ner
Ner ner her ner ner ner hner the ner
Er ner ner hner ner, nher hner ner ner (etc.)
Ner hner ner, your gleaming swords
We mortgaged to the hilt

Morporkia! Morporkia!
Hner ner ner ner ner ner
We can rule you wholesale
Credit where it's due."

Or alternatively:

Instead of "Do what we say, or we'll kill you," it's "Do what we say, or we'll call in your mortgages."

[erik]

Well, I get to eat crow since China hasn't devolved in 1 week. They're hurting themselves worse in the long run of course, but anything to save the oligarchs for now.

Some reading.
http://www.vox.com/2015/7/11/8933341/ch ... to-save-it
http://www.zerohedge.com/news/2015-07-1 ... -and-japan

I underestimated the lengths they'd go to keep the market from crashing. Ordering people to buy stock and not letting people sell... isn't really a market anymore, and definitely not sustainable. But it can keep the cork in for another week, maybe months, and instead of a bubble popping you get even greater catastrophe. I still think this is a much bigger deal than Greece, but the exclamation point has been delayed a bit and will come out louder and harder. Nobody can say exactly how much of the market is on margin, possibly 15% if not more.

The only way to I think they can keep it from ever popping is to ultimately devalue their currency into toilet paper. Keep printing money to give to banks to loan to people to buy moar stock. My guess is that China wants to slow the exchange until the economy catches up, by guaranteeing that it cannot drop… which means people will just pump the bubble harder. How much of a put can the Chinese government force on their market?

[DSMatticus]

The Chinese government closed their stock market. That is what actually happened. No one is calling it that, because journalists are a grab-bag mix of total dumbasses and market-fellating centrists, but it's a stock market in which it is illegal to do any stock trading of any significance. It's a closed stock market.

Because the stock market is closed in all but name, the amount of money the Chinese government has to pump into it to control prices is manageable - for the time being. And that is exactly what they are doing. By being the only actor allowed to make a meaningful volume of trades and by being willing to take substantial losses on those trades, they are able to basically set prices. The numbers we're seeing out of Shanghai are meaningless; they essentially just tell us what the government will pay you if you're one of the lucky few the government decides to let out of the market. If you aren't one of those lucky few, you don't get to sell at all better luck tomorrow.

If you were predicting the total collapse of the Chinese stock market, you were more right than I would have ever imagined - there used to be a Chinese stock market and now there isn't. That is as collapsed as it is possible for a thing to be. The only reason we're still talking about the Chinese stock market like it's a thing that actually exists is because holy shit it would be scary if there weren't let me play pretend just a little while longer.

And despite China's desperate attempts to rally their market, they are still down from around ~5100 to ~3800 and they seem to be back on the decline. Though, again, increases and decreases mean nothing right now - they're a pure reflection of the Chinese government's willingness to throw away money for the sake of bigger numbers!!1!, not actual stock trading.

[Username17]

Pro-tip: do not ever link to zero hedge when discussing any subject other than "what do crazy people believe?" Zero hedge routinely presents speculation as fact, the ramblings of crazy people as trusted sources, and zombie myths as established history. Consider this discussion of inflation from April of this year. Not only does it present a chart without scaled axes as if that was a thing that made sense from the fucking Gold Standard Institute (warning alarmingly of large but unquantified "hidden debasement"), but it provides links to fucking Shadow Stats as a source of inflation information.

Zero Hedge is full of crazy talk by liars and fools.

Anyway, yes the Chinese stock market has collapsed as thoroughly as such things are able to.

-Username17

[erik]

Gah. zero hedge was for the charts. I'd found other sites estimating ~15% of the trades being on margin. I think another was on bloomberg, but it was a day or two older so I went with the more current. I should have just avoided zero hedge after dismissing a couple articles as being too out there.

My expectation was that the Chinese stock market would be collapsed and it would be major news. Apparently almost nobody wants to talk about it in the news though and that's why I get to eat crow.

[Longes]

Apparently UK's NATO military spending is so large because UK has a very different idea of military spending compared to other countries.

[Lago PARANOIA]

So what are the next steps for China, the rest of the EU minus Greece, and the rest of the world at large? What are your salient predictions and conditionals for the next, say, now to four years?

[Username17]

So what are the next steps for China, the rest of the EU minus Greece, and the rest of the world at large? What are your salient predictions and conditionals for the next, say, now to four years?

China has closed most trading on their stock market for the next six months. Most analysts seem to think that because the stock prices still haven't fallen far enough to erase the last year's bubble-gains, that the market is still under pressure to fall as soon as those restrictions end. So no reason to believe that those restrictions will be ending in full when they are currently scheduled to.

Of course, whatever the fuck you think the fundamentals of Chinese corporate stock actually is, why the fuckity fuck would you want to buy any of it? The PRC has shown that it is more powerful than the stock market, but only by reminding everyone that the Chinese government can and will change the rules at any time. Think about it: if you buy Chinese stock, it is entirely possible that when you want to cash out you will be forbidden to by the Chinese government. Whatever the face value of the stocks you own might be, its effective value may well be zero when you need it.

Pricing in that kind of uncertainty is going to put huge downward pressure on Chinese stock prices, which in turn is going to put more pressure on the government to do more of these crazy iron fisted things. You're looking at a confidence spiral where the stock market effectively no longer exists as a thing that foreign investment interacts with. At all.

-Username17

[Lago PARANOIA]

So here's the (literal) trillion-dollar question, then: will the PRC be able to conduct a government stimulus massive enough to at least partially reinflate the stock market bubble without causing runaway inflation in their home country once foreign investment pulls out? And if not, what's their next step?

[Username17]

So here's the (literal) trillion-dollar question, then: will the PRC be able to conduct a government stimulus massive enough to at least partially reinflate the stock market bubble without causing runaway inflation in their home country once foreign investment pulls out? And if not, what's their next step?

Well they've already managed to reflate the stock market. They've forbidden unapproved trades and what trades they allow are funded by the government and arbitrarily set prices to higher levels. The Shanghai index is up 10% from the trough.

The problem is that they killed the market in order to save it. There is no "market" in any meaningful sense. For fuck's sake, you aren't even allowed to make an IPO any more. To the extent that stock markets are "for" anything in the real economy, it's to match savings with investment. If companies who want to invest can't sell stock to generate capital and people who want to save can't liquidate their stock portfolios in the future, the market is providing a service for neither investors nor savers. The Shanghai index is just a number. The government has announced that they can set that number to anything, and now it doesn't mean anything.

The real issue is how the fuck productive businesses are supposed to get investment if the entire stock market has been reduced to a Potemkin village. The Chinese people aren't dumb, so I assume that they are going to start issuing profit-dependent bonds that act suspiciously like stock but (at least temporarily) evade the draconian regulations on literal stocks. So look to a massive flight of Chinese capital to what are essentially junk bonds, which as we know from US history, always goes well.

-Username17

[Ancient History]

What it really does is lock in the class of people that already have stock; presumably if the companies survive, then they still pay dividends to shareholders. Companies can no longer really raise money from stock offers unless they sell part of themselves to the government (with the Chinese government's permission), but they also aren't subject to the vicissitudes of stock price. The music has ended and anybody that doesn't have a chair is out in the cold.

On the one hand, that's squashed China's bubble of people betting on shit with borrowed money. On the other hand, that means there is going to be a market for such things, either legal or quasi-legal. It just probably won't be stock or margins.

[Blasted]

The real issue is how the fuck productive businesses are supposed to get investment if the entire stock market has been reduced to a Potemkin village. The Chinese people aren't dumb, so I assume that they are going to start issuing profit-dependent bonds that act suspiciously like stock but (at least temporarily) evade the draconian regulations on literal stocks. So look to a massive flight of Chinese capital to what are essentially junk bonds, which as we know from US history, always goes well.

Many of the larger Chinese companies trade on other exchanges. For the last 6 months or so their shares have been cheaper on foreign exchanges. I think that for large companies raising capital isn't going to be an issue and smaller companies will have to either IPO offshore, or get themselves bought out by already mature companies.
China has killed Shanghai as a financial centre. Companies will still trade there, for access to the Chinese economy, but it's not going for the exchange. I don't know if HK will be considered a safe haven, so this could be a huge boon for SG.

As for capital flight - I'm looking for large foreign investments from the Chinese. As (and when or if) they're allowed to liquidate their stocks I don't think anyone will be looking to local assets. I'm aware that there are controls around that, but they've been evaded for years. If stockholders can't liquidate then there's a cash flow problem for lots of businesses all of a sudden and it will be bankruptcies all round.

[nockermensch]

Well, the greek parliament just accepted SUPER AUSTERITY. I fully expect that country to descend into chaos as the 60% who voted NO take to the streets to make their discontent known.

In local news, our leftist government is under siege. It's well in the realm of possibility that Dilma can't finish her mandate, being impeached before. It's lovely to see how the forces of Capital always help their own.

[DSMatticus]

Protesters and police have already clashed (in the "things are on fire and the air is teargas" sense), and will probably clash on and off for some time.

[Longes]

Mirrors on the ceiling,
The pink champagne on ice
And she said "We are all just prisoners here, of our own device"
And in the master's chambers,
They gathered for the feast
They stab it with their steely knives,
But they just can't kill the beast

[Ancient History]

Which, if you do the math, only leaves the country ~900 million euros left of the ~7 billion euros they borrowed - which, on top of the new taxes, et al. means they're going to run out of money again soonish.

[Schleiermacher]

What a tweeest!

Fuck it, the whole situation just makes me so angry with the mix of stupidity and bald-faced greed.[/i]

[Ancient History]

I don't know how much greed there is. Money-grubbing, certainly, but at least really greedy people are either obsessive about it or take some pleasure in it...this is more like economic sado-masochism.

[MGuy]

So what does this do for the Euro? It sounds like Greece still won't be able to pay anything off so what exactly did this whole song and dance do that would benefit the Euro? Can't Greece still just say 'fuck it' and leave the Euro? Doesn't keeping Greece on the Euro, given that they can't pay anything and will probably just need to keep 'borrowing' money just mean that the Euro itself will suffer in the long run?

[DSMatticus]

The people who run Germany subscribe to the exact same economics as the Republican party - that is to say, they believe economics is a dirty word and instead they are 100% about redistributing wealth upwards always and forever by dismantling the welfare state and slashing corporate taxes. Remember: when the troika looked at the Greek offer, they demanded a higher VAT and a lower corporate tax. Their agenda is not subtle. It is convenient for them to talk at length about how the Greek crisis is one of Spending Gone Wild (it isn't), and it is inconvenient for them to admit that the solution is fiscal stimulus and inflationary monetary policy (it is).

Germany, specifically, has direct incentives to prolong this crisis indefinitely and as cheaply as possible. If Germany had its own currency, its economic strength would push the value of that currency up and reduce the competitiveness of its own exports. If Greece had its own currency, its economic weakness would push the value of that currency down and increase the competitiveness of its own exports. Because these countries share a currency, however, its value falls somewhere in the middle; too strong for most of Europe, too weak for Germany. This makes the shared currency a giant stimulus program for Germany paid for by hardship across the rest of Europe.

Syriza is also an openly anti-capitalist, anti-austerity party. Every country in the EU has parties like this (and their equivalents on the right), and they're all gaining ground rapidly. Syriza is being made to crash and burn for a very, very specific reason; the media needs to be able to talk about Syriza like they ruined a good thing and it's their fault for trying to buck the status quo. You'll note that the IMF blames the previous government's and current government's failure to stick 100% to the austerity program for the lack of progress on paying down the debt, and can barely be forced to admit that it is fucking impossible for Greece to pay off the debt through austerity because it destroys their economy faster than it saves money.

The latest round of the Greek debt crisis made euroskepticism a valid position for mainstream left-wingers. The euro is being used by conservative governments in a handful of states to export economic misery across Europe, and in exchange for exporting slightly less of that misery those governments are demanding that Europe do a bunch of take-from-the-poor-and-give-to-the-rich bullshit. It's seriously a (primarily German) neoliberal takeover of Europe by force - where the force in question is the ability to collapse a country's banking system through (arguably illegal) action of the European Central Bank instead of rolling tanks across the border. And after the past couple of weeks, it's become impossible to believe it will ever be anything else.

[PhoneLobster]

The long term political ramifications could be potentially more of a big deal because...

The latest round of the Greek debt crisis made euroskepticism a valid position for mainstream left-wingers.

While the European union and the eurozone and so on has largely been built by and for incompetent neo-liberal aristocrats... to the limited degree it has historically had any sort of grass roots support throughout Europe I at least was under the impression it got it by cloaking itself in centrist leaning progressive ideals of unification and co-operation for the betterment of everyone involved and so on that appeal to center left and even left grass roots.

The harder right you swing the more grass roots might support stupid economic sado-masochism, but also the less they support the very concept of the European Union so there is no support base for the EU on the right side of politics. But now anyone left of a Frankenstein's zombie amalgam of Ronald Reagan and Margaret Thatcher has just been thoroughly alienated from the very concept of the EU, possibly for an entire generation.

They already had problems with grass roots support for the EU collapsing, they have upcoming UK referendums and stuff threatening it's very existence. What the hell makes them think this sort of behaviour will lead to the survival of the union?

The answer. They don't care, and they didn't think.

[MGuy]

Ok so Germany benefits but how does any other EU nation benefit from this crisis? I mean the German economists can't be the only ones analyzing this situation right? Even if the Austerity fappers like austerity shouldn't there be other big budget interests trying to... I don't know, benefit some how? Doesn't Greece have a set of its own financial advisers that can explain to everyone in and out of the country in some big fashion the situation they're in? I meant he propaganda machine that is painting the narrative that Greece has/is on a big spending spree and refuse to stop is kind of a thing I hear occasionally. John Oliver even made a quip about it in his last broadcast. It would seem like the people running the financial institutions should have obvious reasons to be trying to call as much attention to what's 'really' going on.

[Username17]

The German mismanagement and cruel yet completely unsuccessful economic sado-monetarism enjoys broad support in Holland, Finland, and Slovakia. This is for a number of reasons, mostly having to do with how politicians and media outlets explain (and fail to explain) the parameters of the crisis and the disagreements to the people in those languages. But mainly because this story, while being basically false is extremely easy to tell. The actual causes of the Greek crisis are quite complicated and what the Troika did with the taxpayer's money from Slovakia, Finland, and Holland is also complicated and corrupt. But saying "lazy Greeks spent it on hookers and blow" is easy. It's not a true story, but it's simple and persuasive. The idea that a vast an informal conspiracy of eurocrats and bankers funneled taxpayer money to banks and got the Greek government to countersign it all despite the country's manifest inability to pay for it in exchange for letting the actual politicians who agreed to the deal skip out and become eurocrats and bankers themselves after leaving public service in Greece is simply too many moving parts. And since the government functionaries who agreed to shipping out taxpayer money in the various countries were getting the same eurocrat deal as the Greek traitors, they have absolutely no incentive to call attention to this revolving door bullshit.

But in a broader sense, the promise of the EU actually isn't very compelling to the Dutch at the moment. What do they honestly get out of the EU? If the EU federalizes, they are going to become Connecticut. And as we all know, Connecticut pays more into federal taxes than it gets back, and the extra money goes to poor states like Mississippi. The purpose of the EU is to prevent war between France and Germany, and to increase the economic and military strength of the union as a whole on the world stage.

But Finland is not France or Germany. And when the EU gets the power to exert demands on the world through economic and military might, Finland is going to have little influence on what the EU actually does with this. So in a very real way, if the EU was to actually work countries like Holland could be looking at spending the rest of eternity sending permanent fiscal transfers to Portugal in order to give Germany a bigger a safer penis on the world stage. Why exactly would they want to do that?

It's not a question with an obvious answer.

-Username17