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To: Pearls Before Swine

unfortunately these theories won’t get tested in a neutral environment, Greeks have been a welfare state for too long, they threw off the Euro because their debt was unsustainable not because they had a better idea.


12 posted on 02/09/2015 1:22:36 PM PST by GeronL
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To: GeronL

These are not normal economic theories... they are negotiating, and game theoretic. Do you search for a Nash equilibrium? Do you act crazy? Those are negotiating strategies.

The “good” outcome for Greece is that the debt is extended to several hundred years maturity (say) with an interest rate of a few tenths of a percent... in other words, it’s forgiven. The question is how big a disaster the alternative—GREXIT—will produce. Will Spain and Italy follow? What will happen to the banks? etc, etc


13 posted on 02/09/2015 1:28:53 PM PST by Pearls Before Swine
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