emergentfutures:

Why is the EU Acting Like a Meat Wholesaler?

I posted this yesterday before the Greek referendum vote

For a long time I was on the board of an unlisted public company that wholesaled meat. The Chairman had a very simple attitude to debt collection. If someone owed us $20,000 then he would spend $50,000 trying to get it back. That may not seem to make economic sense but it made sense when you think of debtors as a network. He simply wanted to send a message that we were not to be screwed with, and that we would chase you to the end of the earth. In the meat industry if you got even a whiff of a reputation that you would not collect your debts then people very quickly stop paying you. This very simple strategy worked very well. On annual turnover of $80-$100 million a year we very rarely had bad debts in total over $25,000 and there were years where we had none at all.

This strategy seems to be echoed in the approach the EU is now taking to Greece. I have done quite a bit of reading and thinking about the issue over the last week or so as understanding geopolitical and economic risk is important to my work as a futurist. I am going to use some of the details in a workshop on uncertainty that I am running later in the month. One standout feature seems to be that the EU is concerned that if they go soft on Greece then Spain. Portugal, Italy and others may feel emboldened not to pay back some of their debt and the problem will spread.

However the story is much more complex than that and the details are an object lesson in the fact that social, political and economic issues are intertwined in these sorts of issues, often at a very personal level of the decision makers……   read the rest

I’ve been assuming and hoping for the things to sort themselves out, and not really paying much attention to Greece.. until now.
It will be interesting to see what happens – but this post – and further reading in it – changed my assumptions quite a bit.

Frances Coppola of Forbes writes really well. (http://www.forbes.com/sites/francescoppola/2015/07/03/the-road-to-grexit/).

My favorite quotes:

“the Eurozone is in reality a financial dictatorship run by bankers. I struggle to see why anyone would voluntarily join it, let alone want to stay in it. But that’s democracy for you.”

Also:
“As Greece’s foreign exchange crisis intensified, mortgaging ports to China in return for US dollars, and hosting military bases for Russia, would suddenly make complete sense.”