How Greek bail outs work.

It is a slow day in a little Greek Village. The rain is beating down and the streets are deserted. Times are tough, everybody is in debt, and everybody lives on credit.
On this particular day a rich German tourist is driving through the village, stops at the local hotel and lays a €100 note on the desk, telling the hotel owner he wants to inspect the rooms upstairs in order to pick one to spend the night.
The owner gives him some keys and, as soon as the visitor has walked upstairs, the hotelier grabs the €100 note and runs next door to pay his debt to the butcher.
The butcher takes the €100 note and runs down the street to repay his debt to the pig farmer.
The pig farmer takes the €100 note and heads off to pay his bill at the supplier of feed and fuel.
The guy at the Farmers' Co-op takes the €100 note and runs to pay his drinks bill at the taverna.
The publican slips the money along to the local lady of the night drinking at the bar, who has also been facing hard times and has had to offer him "services" on credit.
The lady of the night then rushes to the hotel and pays off her room bill to the hotel owner with the €100 note.
The hotel proprietor then places the €100 note back on the counter (so the rich German tourist will not suspect anything)
At that moment the traveller comes down the stairs, picks up the €100 note, states that the rooms are not satisfactory, pockets the money, and leaves town.
No one produced anything.
No one earned anything.
However, the whole village is now out of debt and looking to the future with a lot more optimism.
And that is how the bailout package works

Re: How Greek bail outs work.

Nice in theory Losos - BUT - what if the lady of the night thought she wouldn't pay her bill and decided to buy a new outfit for £50 and, some groceries for £25 and then leaves town quickly to find another room somewhere, putting the remainaing £25 down on a new room and promising the rest on credit which, again she doesn't intend to pay back. The hotel keeper would be left to explain to the rich German tourist that he had misappropriated his money. Would the rich German tourist have a claim on his hotel ? and take payment in kind, i.e. furniture and fittings (with an extra comfy bed thrown in as interest, of course)? - He would then end up becoming richer and happier, because he sold the furniture profitably - but for cash NOT on credit, of course) The poor old hotel keeper is the one who has just got poorer and may go out of business if he has no furniture or comfy bed for his guests. The lady of the night is temporarily better off being fed and clothed. Just a thought, but it gets a bit complicated don't it

Re: How Greek bail outs work.

What can I say, I've never met any 'ladies of the night' so I can't vouch for their fiscal proprietry (Well maybe I have met some but didn't realise at the time what their occupation was, wink icons needed here I think)

Re: How Greek bail outs work.

I think this explains the Greek bailout concisely and simply

Re: How Greek bail outs work.

Bruce I have never heard of Clarke and Dawe, I guess they are the Australian equivalent of Bird and Fortune..

http://www.youtube.com/watch?v=hXBcmqwTV9s

It would be funny if it wasn't so near the truth.