I honestly don't have a clue how the EU is going to sort this mess out... With Germany and France talking about "reducing the number of member states" they might be looking at thowing Greece and Italy to the wolves to save the rest of the EU. This goes past my understanding of economics, but is it time the world considered the "big reset button" where they simply (aka in a incredibly complex way) wrote off all national debt in one go. I have no idea what it would do, if it could be done or if it would save the economic world or simply plunge the lot of us back into the dark ages. But ultimately 'money' is just an invented way to transfer goods and services indirectly
That's pretty much what happened, the same as any 'bubble' you'd think human nature wouldn't play a part in it, but it really does. There's a very obvious tipping point, where they couldn't keep growing the bubble and the investors who blindly invested in something no body understood because it was a 'sure fire thing' realised they didn't understand it once the values began to fall and panic made more and more people pull out so in the same way as people followed the herd into it, they did out of it. The amercian sub-prime swindle / bubble / market was only an extreme version of what was happening the world over though, the straw that broke the camels back. the global recession was coming anyway, and probably 5 years overdue.
If Italy go, what about Ireland, Spain and Portugal? all a bit of a mess. can't keep bailing people out, someone will be left holding all the cards and what then?
You're right there! They only have 1Bn (was 500M until last week) to play with, the bad debt is officially quoted at 4.5 Bn.
Yup - if they have any sense they'll let the banks fail and bail out the individual savers. Other banks will rise from the ashes and take over. It'll be bumpy for a year or two, mind. Bailing out the banks last time bought us nothing - just delayed the inevitable, sucked a load of money out of the economy, and increased govt debt. Sorry, lads - backed the wrong crooks and they can't pay it back.
Very James Bond plot and the baddy who plans this has always built up a mass of solid assets, Gold for instance. Well thanks to the one eyed pirate Gordon Brown, we the UK don't have any gold to hold as an asset to make an economy on if you did wipe the debt. As you say the worlds economy is just fictional numbers.
