Tuesday, June 28, 2011

Should the Greek's Default

Interesting times in which the Greek Government is going to decide if they will default on outstanding debts or get more money.

In the end a significant number of countries are going to default. So if I was Greece, I would accept whatever terms is given to me so that they could give me more money. Whats the use of defaulting now when I can default later but have more money to play with, while waiting for other countries to default. In the end Greece will claim sovereignty and wipe all the overseas debts. Iceland seem to be going okay defaulting on their overseas loans.

What worries me most is that we seem to be the end of the Keynesian economics which has been good for the majority of people but bad for the environment. So I can see when this all unravels their is going to be much harder life for a lot of people. I like keynesian economics better then pure market based economics as pure market based approach leads to more social unrest. Its better for society to keep the losers in the economy well fed and occupied then starving and cold.

So the real question for TPTB is how to keep people well fed and occupied when they are running out of resources to keep people from revolting. For me the problem is that a tipping point has been reached as a significant number of peoples expectations to be docile requires so much more resources. The acquiring of these resources is destroying the earth.

Really there are not many choices as the earth is sick and can't sustain the current needs of the people. You have to change expectations of the people, get more resources with less environmental impact and reduce the factors that are eating those resources.

How TPTB will do this will be interesting as the current method of printing more money to address issues only leads to more resources being needed and expected


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