Europe | - Part 5

Rethinking Money

The folks at GoldMoney and Bitcoin Magazine talked to some ordinary people in Cyprus after the recent bank bail-in and put together this video that really makes you feel for those who had nothing to do with the bank dealings that got the island nation into such a mess.

The timing and the results are impossible to predict, but you’d think that, at some point, some alternative to the current monetary system is inevitable, though the powers that be will likely go kicking and screaming toward that outcome.

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Breaking Down Euro Area Unemployment

After it was announced that euro zone unemployment reached a record high of 12 percent in February, The Economist broke down the numbers in their Graphic Detail chart feature.

Look for the fourth entry on the right – Cyprus – to move up fairly quickly in the rankings, the logical result of decimating a nation’s number one industry in banking.

Also see Spiegel’s Record High: European Jobless Rates Show North-South Rift to learn:

The debt crisis is hitting young people particularly hard. In Greece, more than one in two people aged under 25 is without work — a staggering rate of 58.4 percent. In Spain, the rate is 55.7 percent, followed by Portugal with 38.2 percent and Italy at 37.8 percent.

Economic powerhouse Germany has the lowest youth unemployment at 7.7 percent.

How could this possibly end well, particularly after Germany’s heavy hand with Cyprus?

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Higher Education in Greece

This Bloomberg story about campus life in the new, more austere Greece makes you wonder about the future of the Occupy Wall Street protests in the U.S. and about higher education in places like California where budget cuts will continue to be felt for years to come.

In the universities of Athens, the city where Plato taught and Cicero studied, campuses are covered in anarchist graffiti, stray dogs run through buildings and students take lessons in Swedish with the aim of emigrating.

Higher education in Greece, as in much of Europe, has been battered by the recession and austerity measures. Budget cuts of 23 percent since 2009 mean buildings aren’t heated in the winter, schools have slashed faculty salaries and newly hired professors can wait more than a year to be appointed.

Students say it’s hard to be hopeful with youth unemployment surpassing 50 percent and protesters seizing university buildings.

“People are pessimistic and sad,” said Konstantinos Markou, a 19-year-old law student, speaking in a lobby at the University of Athens, where dogs fought nearby and students say drug dealers and users congregate. “The sadness is all around the air.”

As universities in Greece reduce salaries and slow hiring, young academics are rethinking their careers there, said Leonidas Karakatsanis, 39, who received his Ph.D. in political science last year from the University of Essex in England and has a research fellowship at Panteion University in Athens.

“My initial plan was to spend some years abroad and return back to Greece,” Karakatsanis said. “Now it seems like it’s impossible to return to Greece. I’m starting to imagine myself living abroad for the next 15 to 20 years.”

While no one is expecting any U.S. states to follow the path of Greece, there are already some important parallels, namely, how policy makers continue to pass on a disproportionate share of the pain to the younger generation who have little political power and how people are adjusting to recent changes by relocating within the U.S.

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Back in Time, Lost Decades, etc.

Using a variety of economic indicators, this item in The Economist’s Daily Chart section provide a depiction of how economies around the world have fared in recent years, from the point of view of how far the Great Recession has set them back.

No big surprise there with Greece taking down the top … er, bottom … spot, but the U.S. coming in third with economic conditions set back to late-2001, is a bit of a shocker. Germany has recovered nicely from the recession and their position relative to Greece goes a long way in explaining why the Greek bailout has been so difficult.

My guess is that a chart depicting the amount of new debt taken on prior to the bust would result in  about the same country order as the upper-left graphic above.

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