My nephew Joe and wife Kendra celebrated the birth of their second son Griffin Henry recently. Congratulations to all (including brother Jerry and wife Jane who become grandparents. Again!). Joe has a new job headquartered in Charlotte, N.C. Everyone is moving in early June from their home in West Bend.
Imagine you are Greek. You live in the land of Oz (the nation of Greece). Nobody works. Unemployment is very high because business can’t afford the mandated union wages. The government provides unemployment compensation like we do here in the “States”. Retirement plans allow people to leave the work force a very young age. Unfortunately, there is not enough money sitting in the pension plans to pay for the retirees. People find it very easy to get sick and live off government subsidies. Taxes are sky-high. You get the idea. Nobody in Greece likes to work. They all want to be taken care of.
As a Greek you have come to understand your country is broke. Other countries in Europe and around the world will not loan money to Greece to keep things going. Greece is one of 13 European countries that use the “euro” as their basis of money. 12 other countries are threatening to drop Greece from their monetary union which means Greece will have to revert to using a new Greek money system. The new Greek money will essentially be worthless if that happens.
You (a Greek resident) are afraid your “euro” money which is pretty stable in all of Europe will be replaced by Greek coin. So Greek people are running to their local bank and withdrawing as much money in “euro’s” as they can. The Greek banks have lost 25% of their assets in the last few days. The money that has been withdrawn will go into “coffee cans” because it’s value is safer than the bank.
The answer is every Greek needs to sacrifice. Retire later. Accept lower wages. Demand less benefits. Yeah, yeah, yeah! Greece is already in fiancial crisis. It ain’t going to get better.
Could something similar to the “Greek financial meltdown” happen here. Certainly not. Our government has plenty of money (oops they borrowed it all from pension plans and Social Security). At least our govenment is not in debt (oops we owe 15 trillion dollars). Unemployment is extremely low (what about the 5 million people that have stopped looking for jobs). Medical insurance is being mandated even if you can’t afford it. Hey this scenerio sounds familiar. Remember the Greeks (the title of my new book)
Love,
Dad