About Greece and bad loans

Greece “We need a loan”

A few years ago, a well known island nation with a penchant for dodgy sipping companies were running out of money so they said to the rest of the group of countries to which they belong:

“Hey, we’ve got no money, can you spot me a tenner . . . or possibly a few billion?”

Oddly enough, the ‘group’ said “well look at the state of you, you have no tax system, not much income and you’re not likely to pay it back but well, we like you because you have some good holiday spots so yea go for it.  .. .  terms and conditions apply”

“Yay, party time” said the Greeks.

About the Ts and Cs

If you or I went to a bank and said “I’m having trouble meeting my bills, I just need a lift to get over a temporary problem”, the bank would want to see your income/outgoings figures and would quite rightly say “you need to cut back on your spending and improve your income”

If you or I were a country that means public sector cuts and raise taxes to generate the cash to pay off the loan.

“Yay, party time” said the Greeks.

This is a bad deal we want a better one”

Several years after agreeing to some cut backs but no proper tax system the Greeks decide that the Ts and Cs are unrealistic, that they are being ‘held to ransom’ over a loan they agreed to and now, with the potential breakup of the ‘group’ they think they have an edge where they can effectively blackmail those who they see as their blackmailers.

 

Watch this space. . .