[quote=AK]If I were Greek, I’d be overjoyed about having 50% to 60% of my foreign debt written off. That’s a substantially better deal than developing nations got in the Brady Bonds deal back in the ’80s.[/quote]
I hope Greece repudiates all of its debts. There’s no reason for the people of Greece to pay the debts of the top 1%. What you are witnessing is democracy in action.
If this keeps up, I suspect we’ll see many more former ex-Government Sachs employees blow themselves up as they don’t know how to operate in an environment in which the government doesn’t continuously bail them out.
The bankruptcy of MF Global demonstrates that the 1% of crony capitalists in America are now subject to the same risks of economic losses as the other 99% of us. Led by former Goldman Sachs Chairman Jon Corzine, MF Global engaged in speculating on the bonds of Portugal, Italy, Greece, and Spain (PIGS) with shareholder money; they then tried to hedge their bets with derivatives called Credit Default Swaps (CDS). The firm relied on Corzine’s inside expectation that crony politicians in Germany and France would stick taxpayers with the cost of bailing-out bondholders, like MF Global. The bet buckled when voters rebelled and demanded bondholders suffer losses. Once subject to capitalist risks, MF Global collapsed.
