By on June 29, 2015

Electric Bus In Athens, Greece

Some transit authorities offer free service to encourage ridership. Greece is offering free service this week because no one has money.

As a result of Greece’s banks shutting their doors and ATMs for the entire week in order to prevent potential bank runs at the expense of their customers — in turn the result of the failing bailout of the nation’s economy — transportation minister Christos Spirtzis declared transit service in Athens would be free to all until next week, Business Insider says.

The move would affect only those in the greater Athens metro area, where 40 percent of the nation’s population call home; the next-largest city, Thessaloniki, can’t waive its fares because its system isn’t fully run by the Grecian government. Meanwhile, Greece stands to lose €4 million ($4.44 million USD) as a result of the declaration; typical fares are around €1.20 ($1.33).

(Photo credit: hans-johnson/Flickr/CC BY-ND 2.0)

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42 Comments on “Mass Transit In Greece Free This Week Due To Economic Crisis...”


  • avatar
    twotone

    How can a country’s economy run for a week without cash? How are people buying basic necessities and making payments?

    Pull the plug and get back on the Drachma. Greece should have never been part of the Euro as they faked the balance sheet. Greece is the Enron of Europe. Time to bite the bullet and get back on track.

    • 0 avatar
      28-Cars-Later

      We are about to find out.

    • 0 avatar
      heavy handle

      “How can a country’s economy run for a week without cash?”

      Some news stories say that they are limited to 60 Euros withdrawal per account per day.

      • 0 avatar
        sproc

        60 Euros cash seems more than adequate for day to day needs in a world where electronic payments are so simple. I can’t help but wonder if Greeks’ notorious rep for tax evasion (one of the many reasons for their mess) and the need to keep a huge off-the-books economy going is part of the overall self-fulfilling prophecy of collapse.

    • 0 avatar
      Pch101

      “Greece is the Enron of Europe.”

      Germany is the Germany of Europe. You shouldn’t want to see German troops or bankers marching through your town if you aren’t German; nothing good will come of it.

      • 0 avatar
        thornmark

        ‘The problem with socialism is that you eventually run out of other people’s money.’

        Interesting link:
        http://www.bloomberg.com/news/articles/2015-04-30/george-soros-s-tax-bill

    • 0 avatar
      RobertRyan

      I have a Cousin and her husband currently in one of the smaller Islands in Greece. she has posted photos of shut ATM’s. They will be going to Spain soon, be interested to talk to her about what it was like

  • avatar
    Pch101

    “its system isn’t fully run by the Grecian government”

    The Grecian government hasn’t existed for thousands of years, by definition.

    http://www.merriam-webster.com/dictionary/grecian

  • avatar
    carguy

    Giving away too much stuff for free is what got them into this mess in the first place.

  • avatar
    Land Ark

    Hmm, I wonder how this affects my shares of National Bank of Greece stock.
    *checks stock*
    I’m not a smart investor.

    • 0 avatar
      28-Cars-Later

      Lost nearly 75% in about a year. High was 38.60 in 2012. Ouch.

      • 0 avatar
        Land Ark

        I bought in late 2011 when I was certain it couldn’t possibly do worse. The economy had turned the corner and everything was heading back up.

        I bought 300 shares over the course of 5 months since they were barely over $1 (less with the last batch I bought). Since then it has reverse split twice and that 300 shares is now 6 shares.

        The value is down 98% since I bought.

        I would sell but as of today the transaction fee would be more than the shares are worth.
        Plus, I need to hold onto them as a reminder that yes, in fact, it can get worse.

    • 0 avatar
      ClutchCarGo

      Worse still, I wonder what credit default swaps are out there waiting to blow up in someone’s face, a la AIG. The unregulated dark market of CDSs was more responsible for the Great Recession than even the liar loans.

    • 0 avatar
      bball40dtw

      You guys want to buy some Iraqi Dinar?

  • avatar
    mikey

    Greece , made their bed, now lie in it.

    . I’m seeing my blue chip shares taking a bath today . My financial guy says “ride it out”. I understand squat , when it comes to international finance. As matter fact , I don’t understand a whole lot about long term investments , period. I’m comfortable with a 3 -5 percent return . That’s why a pay somebody to do it for me.

    I can bring my portfolio up on line, and I find today rather scary. I also have figured out that if I make 10 dollars , and spend 15….. There will come a day of reckoning . Why can’t Greece , grasp this concept ?

    • 0 avatar
      28-Cars-Later

      The problem with socialism is that you eventually run out of other people’s money…

      • 0 avatar
        heavy handle

        In this case, the government trying to clean-up the mess is left wing, and the government that created the mess was right-wing. I do appreciate that some people consider it all left wing, seeing as it’s taking place in Europe.

        • 0 avatar
          28-Cars-Later

          Please leave the false paradigm at home it took years to get to the point of no return. Small states such as Greece, and Puerto Rico for that matter, have apparently been living beyond their means for too long and the banksters have been more than happy to keep giving the debt addicts another hit at a steep price. Now there seems to be panic among the Greek people if any of the images coming out of the country are to be believed. Gee who could have seen this coming?

          • 0 avatar
            Pch101

            You’re all missing the point of the Greek problem.

            Prior to the recession, Greece ended up with an overvalued currency, which gave it excessive spending power. The economic growth that it enjoyed before the crash just gave it further to fall, since it was propped with its use of a currency with an artificially high peg compared to its own economy.

            The European Central Bank should have subsequently responded to the crash with a QE program, but it didn’t because the Germans thought that they could have their export cake and eat it, too (i.e. maintaining high exports during a recession, in spite of an overvalued currency.) A completely self-serving approach that had no place in a pan-national central bank.

            This policy screwed any Euroland economy that wasn’t a major industrial exporter, i.e. not Germany. But it was always built on a house of cards, and now Europe finds itself lagging the rest of the world thanks to the foolishness of the Germans.

            Moral of the story: Allow the Germans to make your sausage and beer and symphonic music, but don’t let them run anything.

          • 0 avatar
            28-Cars-Later

            I like your moral of the story.

          • 0 avatar
            heavy handle

            From what I’ve read, there’s no real panic. At least not anywhere near the scale that TV experts where confidently predicting this weekend. Stock markets have been calm as well.

            I’m not convinced that Greece has been living beyond its means. If anything, they are victims of not paying what they could easily afford. The effective taxation rate was ridiculously low, once you factor-in massive tax evasion. Add some extensive top-level “cash diversion” and it’s hard to argue that they are a case of socialist policies gone wrong.
            Most Greeks saw little if any benefit from the money that was wasted. It was just good old mismanagement, incompetence and greed, which is ideologically neutral.

          • 0 avatar
            thornmark

            >>Moral of the story: Allow the Germans to make your sausage and beer and symphonic music, but don’t let them run anything.<<

            I guess the French thought that when they tried to bind and control Germany in the EU. The French were, as is there way, wrong.

            Angela Merkel is essentially the first chancellor to fill the seat of "leader of the free world," a position normally held by the American president, and she has performed competently in this as in her other roles. She did not create the conditions facing the Greek nation, nor is she responsible for the course taken by its government.

            It’s common knowledge that Greece cooked the books to enter the union, they never should have been allowed in and now its people will pay the price for that deceit. Greece's crackup after borrowing an amount 1.7 times its larger 2013 GDP is a valuable lesson in basic economics, something socialists never seem able to learn.

            As for QE in the US, it has produced the worst recovery in US history, a recovery so bad that most Americans believe there has been no recovery. QE has produced the worst income stratification the US has seen in decades and major asset bubbles, not to mention the doubling of national debt under the current administration.

            Hardly a record to emulate. Germany is doing much better in comparison.

          • 0 avatar
            Exfordtech

            Well, perhaps let them run the trains. Just don’t let them be the police.

          • 0 avatar
            JimC2

            “Well, perhaps let them run the trains.”

            No, no, let the Italians run the trains… or do I have that the wrong way ’round?

          • 0 avatar
            Exfordtech

            Heaven is where the police are British, the cooks are French, the mechanics German, the lovers Italian and it’s all organised by the
            Swiss.
            Hell is where the chefs are British, the mechanics French, the lover’s Swiss, the police German and it’s all organised by the Italians

          • 0 avatar
            Pch101

            “Germany is doing much better in comparison.”

            Well, gee whiz, I would hope so, since it manipulated the ECB to serve its objectives at everyone else’s expense, as I had already explained.

            The funny thing, though, is that German efforts to prop up the euro have failed — it is now trading at a level below what it was when it was introduced. So the Germans have not only managed to destroy their neighbors, but they didn’t even achieve their own objectives.

          • 0 avatar
            RobertRyan

            Another country that shall remain nameless, but has a population of roughly 300 million was doing the same. It paid for it too

          • 0 avatar
            RobertRyan

            @thornmak
            Pretty good summing up

    • 0 avatar
      ihatetrees

      Your financial guy has a point. Short term fluctuations are not a big deal.

      THAT SAID, if you’re near retirement, shares are a poor investment. Bonds. Blue Chips Firms and Government Bonds (in responsible countries like Canada, Norway and – a distant third – the US).

      That said, given the potential of a Euro Disaster Black Swan, minimize your exposure there for the next couple years. (Unless you have the Iron Stomach necessary for a Big Euro Short – like the guys who cleaned up when housing cratered 6 years ago).

  • avatar
    jkross22

    Stupid question: What happens when Greece defaults and the people owed don’t get paid? Don’t those who own the debt need to pay someone for their debts?

    Poorly worded but you get the point.

    • 0 avatar
      JimC2

      You pretty much answered your own question (and the natural corollary to your question, just in case you hadn’t thought of the corollary yet).

    • 0 avatar
      psarhjinian

      “What happens when Greece defaults and the people owed don’t get paid?”

      People who own that debt don’t get paid, or they take a haircut. See: Argentina.

      The problem with Greece isn’t (partly, or even mostly) that they’re overly profligate, or that they don’t “pay their dues”, it’s that they have a national economy without their own currency. Most other countries can deflate their way to competitiveness and then claw back up, or they can just declare bankruptcy and sort things out.

      Greece and other euro-zone countries can’t do a) because of the Euro (you can’t deflate a currency shared by multiple states; Florida can’t deflate for the same reason), and doing b) is much harder because their currency is held hostage by other nations and a default by one shakes confidence in the others (even if Greece is to the Eurozone what Miami or Atlanta is to the US dollar)

      If the rest of the ECB (read: Germany) would have either bailed Greece out comprehensively without the need for crippling—and almost punitive—austerity, or not allowed Greece in in the first place, this wouldn’t be an issue. But, as Pch notes above, German exporters and bankers wanted their cake and to eat it too.

      I imagine that Greece is being watched very closely by Italy and (especially) Spain, who are also being forced into a straightjacket so that Germany can remain competitive. If Greece comes out of the Grexit in decent shape (Argentina did) then it’s good news for the _people_ of Spain and Italy, and perhaps less good news for Germany (and to a lesser degree, France), especially their bankers and exporters.

      The Eurozone is going to have to decide if they want to be loose economic cooperative (like the EEC was originally) or a fully federal union (like the United States) with a unified political process. What they have now (a currency union and some free-trade deals) is the worst of both worlds.

  • avatar
    Steven Lang

    I posted this on Facebook yesterday evening, and given what’s been mentioned here I’ll post it here at TTAC.

    Four lessons we can learn from Greece.

    1) You can’t ‘elect’ money if your creditors aren’t willing to give it to you anymore.

    2) Most governments are voracious destroyers of the lesser wealth owned by the many, and the strongest protectors of the greater wealth owned by the few.

    3) Humanitarian aid for Greece will be far more helpful than financial aid over the next year. A lot of good people are going to get seriously hurt and unfortunately, the clown who now runs the place won’t be among them.

    4) Greece would be far better off splitting into separate countries and abandoning the crippling legacy that is modern Greek governance. As far fetched as this seems now, it may be worth remembering that city-states ruled Greece for a far longer period of time than the current republic.

    • 0 avatar
      Pch101

      It’s fun to moralize about Greece, but it misses the point.

      The lessons are obvious to anyone who understands economics, as we’ve been down this road before:

      1. Currency pegs have to be well managed or else they don’t work.

      2. Central banks have to work on behalf of all of their constituents, not just for one at the expense of the others

      Instead of being part of Europe, Germany wants to dominate it. Everyone else has paid for this attitude, and it obviously isn’t the first time in modern European history when the Germans have wreaked havoc on their “inferior” neighbors.

  • avatar
    MRF 95 T-Bird

    Here is a list of places that offer free public transit. They view transit as a public good akin to police, EMS, fire parks and roadways.

    http://freepublictransit.org/Success_Stories.php

    Another way is to implement congestion or value pricing. http://www.nnyn.org/updates.html

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