First of all, my apologies to Taylor Coleridge for the post title!
I imagine that the economic crisis is getting the same amount of media coverage everywhere else as it is in Greece. However, it seems that here the crisis has been an opportunity or excuse for all the stuff that has been bubbling just under the surface for quite a long time now to come out into the open.
While in other countries the interest rates are being cut, in Greece the banks have not only not cut the rates, but have actually increased them! This has acted as a catalyst for all the financial and economic woes to burst to the surface. Greeks - the people not the country - have the highest rate of indebtedness in Europe. If you look at the following factors, it won't be hard to understand why.
The salaries and wages in Greece are amongst the lowest in Europe and yet the actual cost of living is one of the highest! What this has led to is a situation where people are using their credit cards just to cover their basic living expenses. Of course everyone knows that this is not a solution, but people are in such a desperate situation that they can see no other way to survive. Now, combine this with the fact that interest rates on credit cards are the highest in Europe and I think you can get an idea of how fragile things are here!
Banks are acting as if they are a law unto themselves as regards interest rates and their treatment of customers. Even though a law has been passed that they cannot repossess or auction people's houses for debts of less than 20.000 Euros, there are still cases of people losing their houses for debts as little as 700 Euros! They have increased interest rates and cut down on the number of loans that they grant - both personal and business. We now have a situation in Athens where loan sharks are putting up posters in the street and hanging around banks to get the custom of those rejected by the bank!
I don't know how we're going resolve this situation, but it seems that in Greece, at least, we are heading not just for the bubble to burst, but for it to explode in glorious technicolour. As I said in my post title, there is money around but most of us cannot see it. I am no economist, and perhaps I am a bit simplistic in my outlook, but surely we have the intelligence and the knowledge to be able to find a way of using the resources that exist to ensure that we can all live comfortably.
Posted On Thursday, 13 November 2008 at at 02:47 by symposio