the situation in Italy

It's tragic to say the very least...
one person a day kills him/herself due to debts.

I sincerely hope the world wakes up 'cause I am one of those who is not prepared to let go to pay for someone else yacht.
when things will get serious and people will really go after politicians,banks and bl**dy goldman sasch,rockefeller and the lot I will be in the street with them ready to smash some heads.

sorry, can't bare it any longer....

Mattia.

Hang in there, you are not alone.

The problem is that while the majority would like something done, they don't want to sacrifice their cable TV to get it done.  People, on the whole, are just too comfortable to do much more than complain.  I'm not pointing a finger at you, or anyone in particular.  I'm guilty, but I have achieved some awareness and do question everything that makes me comfortable and sleepy. I even reject some of it.

I think the only thing that a person of conscience can do is to realize that their community can be improved by direct local action.  By that I mean that you should do things to improve your community, by doing something for your neighbor, in a selfless way, because you believe that will make neighbor's life better.

Forget about your state/country/race/religion; these are crutches that people use to create divisions in the world that separate  'us' from 'them'.  These divisions of humanity arise from mechanisms that we all have built in as  part of our evolutionary legacy; we wouldn't be here if we didn't have pack animal behavior built into our DNA.  The problem is that our brains are flexible enough to envision and desire a better way, while our DNA cannot evolve away our pack animal behavioral characteristics at the same pace.  so, we live in fear of 'the other', and seek comfort in the familiar.

Some of us will believe in a better way, and sacrifice comfort in that belief.  The connections that you have in your community will define your sphere of influence.  Be connected, help your neighbor, do something uncomfortable.  Influence will radiate from there and merge with similar efforts around the globe.

It's tempting to buy into the notion of political influence on a larger scale, but politics are fundamentally about concentration of power, and where power is concentrated it will amplify the flaws in the human character.  Politicians will try to convince you that if you support them in their efforts to wield power, that they will be the ones to 'do good' with that power, and we are tempted by the prospect of expanding our own sphere of influence by proxy.  You don't need the political system to wield power beyond your neighborhood anyway...  you have global economic power.

We can (and I'll argue - should) influence the world beyond our local community with our spending habits, but we generally have limited knowledge of the effect of our choices.  We believe that we have made a choice in good conscience , but without firsthand experience of the place/people/thing that we are trying to influence, effectiveness is limited or nonexistent. So I think it's best to focus your efforts on people and places that you have had real interactions with, and can decide in an informed way whether to grant or deny economic empowerment.  But on the whole, this is a sideline to primary influence that you have - the local influence.

I find that - as a rule, people who offer a lot of rhetoric on national and global politics, shy away from local action.  It's so much easier to wield power at a distance than hammer out the solution to a problem face-to-face, but face-to-face action is the training ground for correct thinking on any scale.

While the fat-cat with the yacht is a real and tempting target of frustration, it is the little actions taken by every one of us, that add up to something so much more damaging.  Which one of the suicides was offered a helping hand by a friend or neighbor?  Did we reach out? Or, have we all let them down by using politicians and the political system as a proxy for our compassion?

I agree...  it's fucking hard to take, but I'm afraid that it's our burden. 

Next time the football match or game is on, get all of your friends who would love to watch it to fix your neighbor's crumbling foundation instead.  I know that that will mean so much more to everyone concerned and be the sort of memory that you can carry proudly for life. It can be a great deal of fun as well.

Thanks for that thoughtful post full of insight.  I don't know how comforting it is to Mattia, but we all wish him well and a good outcome.

The burden of debt is insidious, and too-easy borrowing is still going on around the world.  I don't know that Italy is unique in having to deal with lender imposed austerity, while that doesn't make it less painful..

JR

I did some work in Italy last year after not being there for a while, and I was shocked at how much the prices had risen.
In general, the mood seemed very gloomy.
For those who aren't aware of the Euro effect (particularly our friends in the States), there are quite a few countries in Europe that have massive debts and, because of the Euro, low growth.
Greece, Ireland, Spain, Portugal and Italy have big problems.
Italy's situation wasn't helped by having had Berlusconi who didn't exactly make things easy for middle class people, but passed laws which really helped the rich.
A friend of mine was on tour last year and was concerned about low audiences in the south.
It was pointed out to him that this was probably because the cost of a ticket was roughly the same amount as a week's groceries.

While I am a little reluctant to pontificate about Europe from a distance (I know how much I dislike hearing such myself), I don't see any EU member country really benefiting from the sovereign debt crisis. While the common currency does seem to favor the strong manufacturing/exporting member nations. This is not directly an effect of the sovereign debt crisis, but an unintended consequence of the shared currency, without completely unified fiscal policy. 

Today (yesterday?) there was a disappointing bond auction in Spain that raised fresh concerns about central bank liquidity.  The strong northern EU members are helping their weaker Southern member states since they all want to hold the common system together. Nobody debates the long term benefit of a common union, but in the short term there will be more such speed bumps in the road.

Few have a lot of faith in the EU bank stress tests that claim everything is OK, but central bank liquidity is mostly a matter of confidence, so if we all trust that they are solvent, and don't stop buying new debt it will work out. The whole world wants to avoid a central banking collapse there, so there is a lot of fresh capital propping up the weakest players, but there isn't enough money in the world to make the problem go away completely, so there does need to be some real discipline applied  (reductions) in deficit government spending or lenders will just go elsewhere. Hard habits to break after decades and decades.

I expect more pain ahead, but hopefully catastrophe can be avoided. 

JR

The Italy's crisis is much different from other countries.
Italy as State is a very rich, it has enormous gold reserves, a huge intangible heritage, it has significant shareholdings in large national companies, as, for example, Finmeccanica, Eni , Agip, IP, Sapiem, St Microelectronics,....etc........(very long list). The very big heritage includes so many buildings with great artistic and historical value. Several europen states are poor in comparison.
Only Germany and France states are more rich than Italy state. 
The matter is that italian governor is a rich with a lot of debts.
In other countries the crisis are the debts of the people, on the contrary in Italy the people is not very indebted.
The problem is that Italian Governor has the power over its people, so it claims that to pay for its enormous expenditures are its citizens, so the people does not pay for its debts but for the debts of the Italian Governor!

As far as turnover is concerned, Italy is doing well. Unfortunately the country ran up huge debts in the 70's and 80's and these have never been addressed. No Italian government had dared tackle the problem.
The debt is so enormous that a bailout would not even touch it.
Meanwhile, prices continue to rise.

There are also quite a few european countries that actually benefit from this  situation (or 'crisis' if you prefer), although they try to show the opposite.

Click to expand...

Yes..... Germany!

The northern European countries are in a better state because they have well developed economies. Germany is an industrial giant. Whereas countries like Greece and Portugal rely on things like tourism.
It is ridiculous to expect all these economies to converge. One size does not fit all.
The currency of a country is a reflection of its economy, how can you possibly compare the economy of Greece with Germany. Yet they have the same currency!
That's why we (UK) stayed out!

Italy is an industrial giant, very much than several northern European countries, but it has crisis. Italy makes all: aerospace satellites, clothing, chemicals, petroleum products, trains, elicopters, cars,food, furniture, semiconductors,...etc....and in these sectors is famous over the world.
The problem is how it handled the public money in Italy and in these countries.

 

barclaycon said:

As far as turnover is concerned, Italy is doing well. Unfortunately the country ran up huge debts in the 70's and 80's and these have never been addressed. No Italian government had dared tackle the problem.

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Yes, I agree , but the country ran up huge debts even in 90's and after.
However, the matter is that much money of this enormous public debt has not been well used by the Italian state, just to be clearer, a lot of this money have not been well spent to produce services to people and companies, so, in pratics, a lot of this money was lost.

The difference between Italy and  northern European countries are how the public money was spent. A citizen of a northern country pays many taxes but he receive many services in return for this money spent, an italian citizen pays much money for taxes vs. a citizen of a northern country but the italian citizen receive many less services in return than the second.

barclaycon said:

Yes..... Germany!

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and France

France and Germany are joined

JohnRoberts said:

I don't see any EU member country really benefiting from the sovereign debt crisis. While the common currency does seem to favor the strong manufacturing/exporting member nations. This is not directly an effect of the sovereign debt crisis, but an unintended consequence of the shared currency, without completely unified fiscal policy. 

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yes for the sovereign debt crisis,

no for the unified fiscal policy, europen countries are too different between them to have an unified fiscal policy now, EU is not USA.

ppa said:

JohnRoberts said:

I don't see any EU member country really benefiting from the sovereign debt crisis. While the common currency does seem to favor the strong manufacturing/exporting member nations. This is not directly an effect of the sovereign debt crisis, but an unintended consequence of the shared currency, without completely unified fiscal policy. 

Click to expand...

yes for the sovereign debt crisis,

no for the unified fiscal policy, europen countries are too different between them to have an unified fiscal policy now, EU is not USA.

Click to expand...

The last thing I am going to do, is lecture you about Italy, but I have been watching the EU project for a long time.

Since you make the comparison between the US and EU, one key difference is that the US states can not run deficit budgets, only the us federal budget has that luxury.  If the EU states were likewise restricted from deficit borrowing, the sovereign debt problem would not exist.

I appreciate this is an oversimplification and offers little solace for how to get out of the current hole.

For now the best that can be done is prop up all the central banks, and reduce spending to survive intact long enough to grow out of the debt hole. A few of the southern EU countries have made pro growth changes to cut away at the layers of bureaucracy in an attempt to stimulate business and economic growth. 

I'm sure each country has it's own unique variation, but there seems to be a common theme. The music finally stopped.

JR

What ??!
I'm assuming that English is not your first language.
That's the only way that you could have possibly interpreted that I was blaming the citizens of Greece, Italy, Ireland for the current crisis. Nothing could be further from the truth, and I'm actually quite angry and offended by your attitude.
I have friends an all those countries and I know very, very well how they are suffering.
I suggest you re-read my posts and perhaps use Google translator or such like. You would then realise that I deplore the Euro-project and the chaos that it has caused.
Germany is an industrial giant - Greece is not, and it is ridiculous that Greece is being punished by the Eurocrats for taking out loans that the Euro banks encouraged them to take out.
This evening I learned that a 77 year old pensioner in Greece committed suicide outside the parliament building in a desperate act of demonstration. He said that he couldn't take it anymore.
People have had enough.

Please get your facts straight before you start accusing me.
Save your anger for those that deserve it.
I actually posted because I know Italy quite well and appreciate what Mata was saying in his first post.

Sorry barclaycon, it might be my English.
I just understood  'It is ridiculous to expect all these economies to converge.' as you were referring to me personally...

OK warpie.

We obviously both agree that this is a terrible situation and that innocent people are suffering.

Well I can't talk about the rest of the european countries, but here, in Spain, (right now, one of the most hitted by the crissis, recesion or whatever you call it, or that's what the media says) there are a lot of people with enormous debts, and people who won't be able to pay that (accounts growing more than I can earn working the whole month? WTF?).

But I'm not sure this is the real problem here. We have grown, as a nation, in the last 10-15 years with the help of the EU money, but we don't have a productive system which gives something to the rest of the world, we just know to build houses, buy it and try to sell it 5 years later for a bit more money, and that makes no sense.

Also, we have a goverment which comes from the previous dictatorial system, they say democracy, bi-partidism blah blah, but the same people got the real money, and they make the decissions finally. We spend far less in the christian church than in R&D (Actually, in the 2012 State budget the R&D was trimmed like 20%, while 0% to the church. Pray for your cancer...) Also, the Royal family, In Century 21th., WTF????

I think THESE are the real problems here, we're walking back in the workers & social benefits, not to sound paranoid, but, to a new world order.

In the USA, they were hitted by recession, but they stimulated the economy (or that's what I know from the News) and now things looks better than 3 years ago. While here in Europe our goverments thinked the other way, and here we are....

Actually, I can't talk about crissis, I earn more money now than in 2008, also my job changed and I could earn a lot more, but, like we say, Es lo que hay.... (Something like "It is what it is...")

I just try to don't let the black clouds go over my head, f*ck them and their money game, just looks for myself and the people around me.

Greece has long had a cultural problem with transparency, trust, rule of law etc. Corruption on all levels of business and politics. When the EU made Greece part of the Euro-zone - against the better judgement of many - there was a steady influx of money and - in hindsight - a lack of accountability. Basically the EU just assumed that Greece would not fudge their numbers (as they did, massively, even going so far as employing Goldman Sachs to help them).

This culture of corruption needs to be addressed, but I doubt that hard core austerity measures will do anyone any good. After all, it only makes it harder for Greece to compete, and the result is a shrinking economy.

It may momentarily look like some of the big industrialized Euro-zone countries are profiting from the crisis, but the truth is that they have to guarantee the debt of the countries that are in trouble now. The whole thing might very well explode in our faces some time in the future, and the only ones profiting then will be investors on the short end of the bet...

I don't know that Greece is unique in fraud, but there seems to be a cultural predilection toward avoiding taxes, and gaming entitlements. I read in a newspaper today about one greek island with 1.8% of the population claiming they are blind for disability entitlements. This is 9x the statistical norm, and very likely fraudulent, with examples of a cab driver and even a bird hunter being pretty obvious.

The fraud only makes it marginally more difficult. Increasing taxes will only drive more of the economy underground. The well is running dry, so no matter how much they are accustomed to government largess and want it to continue, adjustments must be made.

Yes, the large industrial exporting nations do benefit from the common currency make relatively weaker by the bad practices of the weaker members, but they are likewise in bed with the weaker nations due to this same common currency. It is politically unpopular in the stronger industrial exporting nations, to bail out the weaker nations.  Nobody is getting a free or easy ride.

There are not good guys and bad guys, but a bad situation that all must work together to get through. Long term there needs to be less government freebies, or at least it needs to be in balance with government revenue streams. That much should be obvious.

JR

PS yes the different nations have their own different circumstances. Spanish banks took over numerous real estate projects when the loans went sour hoping to salvage the loan assets on their balance sheets by finishing the projects and selling the houses or buildings, but many of these projects were based on unrealistic growth projections, which means the new homes will be hard to fill.  All different facets of the same sovereign debt problem, linked to each other by the common currency.

The right decisions are not usually the easy ones [ to carry out ]
if you had to give up all everything  but you knew it would benefit your children , you would
but it seems so far gone that paying it forward will have to go a couple of generations ,
I exaggerate  without details , but who wants to blindly work for someone else or the unknown
it's true it's getting harder to live everyday with no confidence that your hard work will
take care of you when you can't ,  Collateral damage if they even consider it in their arrogance & ignorance
seems petty to the average politician . It does seem business runs government which is profit & procedure
not people