Wednesday, July 8, 2015

Just because the headline doesn't.....................

.........make sense in light of the article that follows, doesn't mean that the article isn't read worthy.  The headline reads, "Greece just taught capitalists a lesson about what capitalism really means."  The author then takes pains to explain who really takes the risk when debt is involved.  As a side note, his conclusion about borrowing and lending does not match my experience, but then the people we borrow from have this thing about wanting "collateral" and lots of it.  Your experiences may vary.
     Where the author runs off the rails is assuming that it was the capitalists who got taught a lesson.  He reports:
There is another key fact that the Greeks are keenly aware of (but that everyone else has forgotten). This debt was initially owed to private-investment banks, such as Goldman Sachs. But the IMF and the European Central Bank (ECB) made the suicidal decision to let those private banks transfer that debt to EU institutions and the IMF to "rescue" Greece.
      Reasonable people paying attention to the state of Europe may be hard-pressed to consider the ECB and the IMF as "capitalist."  Looks to me like the real capitalists skated, and the "statists" trapped themselves.

No comments:

Post a Comment