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Viljo Viitanen
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Viljo Viitanen

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Erittäin mielenkiintoista keskustelua alkuperäisessä postauksessa.

Sen verran kommentoin tässä, että on toki monelta kannalta mahdoton ajatus, että EU:n sisällä vain jaettaisiin vastikkeetonta rahaa paremmin menevistä maista huonommin meneviin, kuten jenkkien sisällä osavaltoiden välillä verotuksella (ja miten suomessakin tehdään kuntatasolla kasvukeskusten ja muun maan välillä). Paitsi jos tuon vastikkeettoman rahan nimi on maataloustuki...
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Irresponsible or unavoidable borrowing?

Growing up in Europe, I didn't pay much attention to the construction of the Euro, and whatever little I remember has nothing to do with the economics of it. Now, older, having lived in the US for a while, with a Greek wife, I'm looking at the way the Euro is unraveling and I've been using the opportunity to try to figure out how it works (or, rather, why it doesn't).

The core mechanism that allows multiple states to share the same currency is pretty simple: since the weaker states can't devalue their currency to compensate for their trade deficit with the stronger ones, money has to flow from the stronger economies to the weaker ones in order to maintain the balance.

We see that in the US: as measured in GDP per capita, there's about a 2:1 ratio between the strongest states and the weakest ones. To compensate for that, a lot of money flows between states, through the federal government. Most taxes in the US are federal taxes, i.e. about 75%, and the federal government doesn't necessarily spend the money it collects in the exact states where it collects them. As an example, every year about 130 billion dollars paid by California in federal taxes don't make it back into California. Texas and New York are the two other states that have a negative balance of more than 100 billion each. For those 3 states, that outflow on money represents 5.7%, 7.2% and 7.4% of their respective GDPs. California is literally sending money to other states so that those states can buy California stuff. The same is true for Texas, New York, and about 20 of the 50 states that are sending money to the other 30.

Looking back in history, the Marshall Plan followed a somewhat similar logic: the US sent aid to Europe, to allow Europeans to buy US goods, which was both a stabilizing mechanism for European currencies that otherwise were in a devaluation spiral, and an outlet for the huge US industrial production. For reference, the Marshall Plan amounted to 120 billion dollars (in today's dollars) over 4 years, which is tiny compared to the amount of money that the federal government now redistributes across state lines.

We can compare that to the situation in the Eurozone/EU, where the GDP per capita varies by a factor of about 2.3:1. Germany's balance in the EU budget is negative by less than 9 billion Euros. France's and Italy's follow at approximately 6.5 billion and 6 billion. Germany's 9 billion Euros is tiny compared to California's 130 billion dollars, especially since Germany's GDP is 60% larger than that of California. Since the US and EU economies have approximately the same size, that's a reasonably apples-to-apples comparison. The biggest negative balance that a Eurozone country has with the EU is about 0.41% of its GDP. The biggest positive balance is 1.3%. Within the US, only 4 states out of 50 fall within that range.

That's the problem right there: Germany is not flowing enough money out to other Eurozone countries to compensate for its own very strong economy. That's true of other rich European countries as well, e.g. Netherlands, Austria, France.

From the Greek point of view, the only way to get that money to flow in order to maintain balance had been for the government to borrow. That wasn't irresponsible borrowing. That was mechanical, predictable. Greece's poor historical discipline around government finances only accelerated an unavoidable process, but it's not a root cause.

In fact, predictably, pushing Greece into austerity made things worse, much worse: with the root cause being Greece's relatively weak economy compared to the rest of the Eurozone, an austerity approach can only put Greece in a position where it needs even more money to flow in in order to maintain balance.

Even if we assume that all of Greece's debts get somehow forgiven with no further constraints and that Greece manages to run a balanced government budget, it would still be in an unsustainable position in the current Eurozone as its weaker economy would force additional money to flow in. Unless the Eurozone very significantly increases the amount of money that it redistributes across borders, Greece should get out of the Euro at the first opportunity, i.e. literally Monday morning, July 6.

Worse, with Greece out, it's only a matter of time for another weak country to find itself in the same position: that might be Portugal, Spain, Italy, or if Bulgaria, Romania or even Hungary join quickly enough that might go through that same death spiral quickly enough to see the Eurozone as a revolving door, with barely enough time to come in before being back out.

Once that first batch of weak countries is out, there'll always be more that'll be at the bottom of the scale and will find themselves in the same position. France is comfortably in the middle of the pack within Europe today, but attrition will eventually push it toward the bottom, and France having to leave the Euro is a true nightmare scenario for everyone.

In order for the Eurozone to survive, its rich members will need to send a lot more money to the poorer ones: the rich ones literally can't continue reaping benefits from a currency based on the European average without sharing those benefits with the poorer ones that bring that European average down. Otherwise, the Euro will consume country after country until it hits a country that is literally too big to fail.
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Viljo Viitanen's profile photoAntti Brax's profile photo
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Se ehdotus pitäisikin naamioida liittovaltioksi, mikä on lähes yhtä mahdotonta. Kaunis ajatus oli Euro.
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Harmittaako liian lyhyt usb-johto, tai riittävän pitkä johto, joka ei kuitenkaan lataa tarpeeksi?

Mua harmitti eilen FS-tapahtumassa molemmat - siis liian lyhyt johto joka ei edes lataa tarpeeksi nopeasti, vaan varaus luurissa laskee vaikka johto on kiinni pelatessa...

Tuosta sisuuntuneena tilasin just nyt voimassa olevasta tarjouksesta (tätä kirjoittaessani 11 tuntia) ebaystä kolme 1 metrin johtoa, hinnaksi jäi postareineen alle 2€/johto. 

www.ebay.co.uk/itm/271677460146

(linkissä ei ole mitään referrer-koodeja tms.)

Amazonissa noi juicebitzin johdot (halvemmatkin) ovat saaneet hyviä arvosteluja, vaikkei ne kahta ampeeria puskekaan läpi. Rahallinen riski ei joka tapauksessa oo kovin iso, ja aika varmasti nää on parempia kuin nimettömät kiinalaiset johdot. Toimituksenkin pitäis olla briteistä aika paljon rivakampaa kuin kiinasta...
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Viljo Viitanen's profile photoEemeli Saarelainen (Molter)'s profile photo
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+Viljo Viitanen ai tuollainenkin on. Käytän Ampèrea
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Viljo Viitanen

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If devs build a modern Web app ecosystem sans Safari, maybe Apple can move beyond 2010.
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Antti Brax's profile photoLauri Pietilä's profile photo
 
"Webbi kuuluu Googlelle. Ei siihen kannata panostaa."
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Viljo Viitanen

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Strava on tehnyt törkeen hienon mainosvideon. Ai että, kylläpä heti tekee mieli tien päälle poljettavalla kaksipyöräisellä.

http://blog.strava.com/ride-with-us/
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A safer road is one that talks. Vehicles that communicate with each other, as well as with the road infrastructure, transport agencies and others, can...
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Vuoden ensimmäinen kesäpäivä Jyväskylässä.
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Viljo Viitanen

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"Blade Runner was set in 2019, 4 years from now. This isn't an outtake from the movie — it's the real Beijing." http://t.co/8Gxu3kOUtS
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At four million log lines a second, CloudFlare, Inc. sees a great deal of traffic. So much traffic, in fact, that it's impossible to digest without some sort of Big Data solution and filtering to break it down into its informative components. To explain how CloudFlare does this heroic job, ...
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Jyväskylän viheralueille suunnitellut teemareitit kiinnostivat kaupunkilaisia. Asiasta järjestettyyn kilpailuun tuli alkukesän aikana kymmeniä reittiehdotuksia.
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On June 28th, a SpaceX Falcon 9 rocket meant to deliver supplies to the International Space Station exploded en route. It was the third cargo resupply mission to fail within the past year. In...
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Viljo Viitanen

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"s2n is a C99 implementation of the TLS/SSL protocols that is designed to be simple, small, fast, and with security as a priority. It is released and licensed under the Apache Software License 2.0."

https://github.com/awslabs/s2n
s2n : an implementation of the TLS/SSL protocols
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Viljo Viitanen

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Potentially a big defeat for EU internet users, online startups and future innovation.
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Have him in circles
480 people
Juho Tunkelo's profile photo
Sami Mäkelä (Mammurabies)'s profile photo
Airi Hietala's profile photo
petr iwanow's profile photo
OriginalKanokas's profile photo
Jussi Silvonen's profile photo
Christian Muurinen's profile photo
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2010 asti asuin Helsingissä, nykyään Jyväskylässä.

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