(News story links via the Drudge Report)
Over the years, those of us in the survivialism/prepping community have long debated what an economic collapse would look like and how it would occur. For me, economic collapse has always been “Number 1 with a bullet” on my list of “Why I prep for long term dislocation.”
When a scenario such as economic collapse is discussed, much time is spent debating how the average person is going to act in that scenario. Indeed, much of the fiction genre that is known variously as “apocoplyse fiction” and “doomer porn” comes directly from that–take an individual, a family or even a small town, yank the rug out from under them and then write your version of how you think things will work out. Some of it is actually quite good and very thought provoking.
But in the real world, there is nothing like empirical evidence. The real world has given us a number of scenarios in the last hundred years where an economy has collapsed. Weimar Germany, Argentina, Cyprus and now Greece are all excellent case studies for those of us who can watch them from some remove. I think Greece is an especially interesting case, as it bears some resemblance to what may be our own situation in the coming years. While we can manipulate our currency, which the Greeks can’t at this point, many of the other dynamics, such as creditors who have reached the limit of how much they are willing to loan a country that obviously has no fiscal discipline…well, I can see us getting there, by and by.
I posted Friday on rural Greeks who are helping themselves and each other in the old traditional way by gardening. This is something that any of us can and should start working our way toward, and soon. One thing you must do or perish is eat. I won’t even go into things like food quality and so on. You simply must eat.
Urban Greeks also realize this, and unfortunately they have limited options. So they’re wiping out the grocery stores and other sources of basic, “gotta have” items with their last cash. At least it appears that it is being done without riots, which is what doomer porn always postulates.
The current Greek government, sounding like the government from Ayn Rand’s “Atlas Shrugged” (you knew that was coming, didn’t you) is urging the citizenry to vote against the only lifeline on offer. While it isn’t much of a lifeline, and in the long run may be as bad or worse than a Greek exit from the Eurozone, it would at least buy time for some cooler heads to come forth. Maybe.
This current Greek tragedy, like the one I believe will eventually befall us all to some greater or lesser extent, is not totally the fault of the Greeks, or the EU, or the bankers. All of them deserve a big hearty slice of this shit cake, because they all had a hand in making it. The EU should have never allowed Greece entry. They had to know Greece was lying about their economic numbers, but no, it was EU! EU! EU! They were blinded by the light of their own supposed destiny. The Greeks were suddenly handed a fire hose of nearly free credit and like a number of other countries that should have never been allowed in the EU, they promptly went apeshit with it.
But my biggest scorn is reserved for the bankers, who cynically continued to lend Greece money even when they had to know that the Greeks had no chance of ever paying it back on their own. They obviously expected that the rest of the EU would pay it back, not expecting that the taxpayers in those EU countries who be on the hook for it would rise up and tell their elected governments “Uh, NO!” and be able to make it stick to a reasonable extent, because politicians fear nothing so much as being voted out. Big miscalculation on the part of the bankers.
Soon, the Greeks who were stupid enough or unfortunate enough to leave any money in their banks are going to loose between a lot and most of it. I think that is going to be a given, no matter what else happens. A “No” vote on the current bail-out plan will probably mean Greece will be in economic chaos within the next 2-3 days, a week at the longest. A “Yes” vote will, in my opinion, just kick the can down the road again, and we’ll have this discussion again another day.
If that vote is “No” and the Greek economy does dissolve in chaos, it is going to be very informative to watch what comes after that. Will the Greek military take power? It has before in time of crisis. Will a new government be formed that is willing to take the bail-out on whatever terms offered and kick the can down the road? Will Greece leave the EU and make a painful transition back to a stand-alone state, repudiating it’s billions in debt–and what actions will the debt holders take to try and collect?
We are not only watching history being written, but we are getting a glimpse of our own future may play out. Pay attention.
1 thought on “Empirical Evidence”
Two points: First about the Bankers. They are often painted in the news as the masters of the universe, but trust me – they are not the smartest people in the world. They gave us the dot com bubble, the real estate bubble followed by the credit-default-swap fiasco. In part because they are so smart they don't have to study history. (The attempt to securitize mortgages in pretty much exactly the way that happened in the latest go-round has happened 7 times since the end of the Civil War.)
Cooler heads in Athens? Not likely. The pols showed a close race. The actual vote was a landslide. If history teaches anything, someone riding in on a white horse will be cheered, even if they later turn out to be Napoleon, Hitler, Trotsky, or whoever. Given the choice between comfortable lies and uncomfortable truths…