Interesting to hear that the US economy was fueled by telephones, cab-rides and airfares. Quite an accomplishment. There was no other economic activity?

They still have the pay the interest on the debt, and the debt itself. They would need a few decades of 10% surplus to be able to address that.

Have you ever considered that the predicted economic recovery for the austerity measures didn't materialize because the prediction was basically wrong? The entirety of the EU zone, not just Greece, has been in a depressed state for many years for as many years as we're trying austerity. Many economists predicted exactly that!

So what's wrong with a massive debt restructuring? The obvious way to get out of this mess would have been a significant inflation. 6% inflation for a decade and the debt would dissappear. Germans have been completely against this for historical reasons, thereby preventing an easy way out.

Small correction. The Greeks spend about 80 billion euros that they didn't have. The rest is interest on the loans. The 86 billion in the agreement will almost entirely go straight back to the lenders. That's how you keep debtors humble.

I guess that after this bit of power-play of Germany the UK will vote themselves out of the EU in 2017.

The difference between your example of a corporation and a nation is that the corporation has limited liability. The janitor of that corporation will lose his job, but he will not be held financially accountable for the bad decisions the CEO made. Not so for the Greeks. Their governments and elites had a ball, and the population is now forced to foot the bill.

The fact of the matter was that Greece has lost 25% of their GDP in the last 6 years, largely due to austerity measures, but were able to create a balanced budget in 2014, and were on the way to have a surplus in 2015. So no, they were no longer living beyond their means. The debt is however crippling at 180% of their GDP (from 135% in 2009, see what a declining GDP can do?).

Totally agree. However, back in the day when Greece was allowed in the EURO (not EU), their obvious unsuitability was waived by France and Germany (under loud protest from the Netherlands and the Finns). It's appalling to see the German politicians ride the moral high-ground after:

1. Allowing the Greeks in the euro in 2001 in the first place when it was obviously a bad fit (same holds for Italy)
2. Breaking the stability pact in 2003 when it was convenient for them, opening the floodgates
3. Profiting immensely from the increased export that was fueled by ill-advised loans to a corrupt elite in the Southern nations
4. Bailing out the banks wrt Greece and offloading the Greek debt on the European population at large
5. Pointing the German anger at a foreign nation to hide their shenanigans

From my point of view it's a very sinister game that's being played here and the European project has failed. The Germans in particular seem to be incapable of taking responsibility for their actions and have stooped to a very dangerous form of demagogy. Let's stop this farce.

If we truly want to increase the carrying capacity of the earth, we should also stop eating plants directly, and just eat some mass-produced gooey that will keep us alive. If we do that, we might be able to sustain a population of a few hundred billion.

In other words, food will always be scarce if the population grows in response to a surplus. Malthusian. Not eating meat is not even the beginning of a solution. Controlling population growth is.

The market can stay irrational longer than you can stay solvent

- John Maynard Keynes

I.e., yes, you can make a lot of money of it, but it requires a lot of patience and money to be able to do so. The Japanese market was overvalued for about 20 years until the bubble finally burst in the nineties. The current China crisis can go either way -- full bust or a regain of control for another decade. There are only a few people with enough money and patience to profit from this by consistently buying puts that are way out of the money and losing money on them year after year -- waiting for that one moment when they make a fortune. Taleb is one.

I think you're confusing free markets with efficient markets.

Why would one want to divert attention to something so utterly insignificant?

Simply because these banks are cooperative banks that are typically run by politicians. Making them go bankrupt would make a lot of Germans much poorer, and their anger would be directed toward management of those banks: German (ex-) politicians. We can't have the bubble burst that German politicians know best how to run a financially austere society.

Of the 390 billion that was on the table, more than 300 would immediately flow back to the creditors in interest payments. Then, in 2020, the Greeks will owe 390, needing 480 to get them through the next few years. With the current plan, austerity + market price interest rates, there is no scenario in which Greece will get back on its feet. We in Europe will need to take a haircut, and if we're angry about it, we should go after the politicians that bailed out the banks that provide the bad credit in the first place.

The Greek deficit is 0.3% of the EU GDP. Even if we were to fund it year after year for the next century, nobody would notice. The drama has been created to divert attention away of the bail-out of the German Landesbanken in 2010.

You forget that California, and Silicon Valley, in particular has great benefit in having a single currency. Without it, a startup would have a very difficult time to scale to 300 million people, in particular because their MVP would be in CaliDollars, and they would then need to think and schedule where they want to launch next. Net loss.