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Yeah.. Hi... with the bad economy... I’m having trouble making the interest payments
on my debt to you. What are my options?
mm hmm... mm hmmm... huh?
What? You want to loan me more money to pay off the other interest that I owe you, but,
if all of this new money you are loaning me is going into paying you back your new interest
while you are cutting my salary in half, how am I supposed to eat?
Oh... I’m not?
Think of it as sacrificing myself for the health of the banks? Oh.. OK... sure.. where
do I sign up?
Hey guys.. Charles Como back with another political minute.
This week we have another crisis coming to us from Europe.. what exactly is it? Let’s
find out.
Start the one minute clock.
This weekend Greece is having elections where it’s possible that the people will reject
the recent bank bailout because that bailout seemed to do nothing more than to put more
money into banks while forcing the Greeks to take on even more debt. The result might
be that Greece is forced out of the Euro.
Now, you might be saying to yourself, the Greeks got themselves into this mess.. screw
em..
Well.. under normal circumstances.. Greece would be screwed.. but there would also be
a light at the end of tunnel.
Instead, by being part of the Euro, Greece is not only screwed.. but there is no light
at the end of the tunnel.
Let me explain.
A sovereign nation with its own currency pays off its debts by printing money. But the result
of printing too much money devalues the currency in relation to other currencies.
But, the result is Foreigners start flooding into the country because now it is so cheap
to visit! They also start buying stuff like crazy.
Pretty soon, so much money flows into the country, that eventually prices work their
way back to normal.
But, because Greece is part of the Euro.. they can’t do any of that.
Instead they are forced to borrow more and more money while no new visitors, and no new
money flows into the country. It becomes a downward spiral.. just like the Titanic sinking
as British Politician Nigel Farage so eloquently put it.
That is why Greece is threatening to leave the Euro... and if that happens Spain, Italy
and France may soon follow.
What do you guys think?
Let me know in the comments below.
And don’t forget to subscribe for more Political Minutes.
Oh, and is something similar happening in this country?
Let me know.
See you guys next week.