Investing in Greece: Only for the Filthy Rich

by on February 23, 2012 at 7:01 am in Current Affairs, Economics | Permalink

If a small company wants to sell shares to investors it must demonstrate to the SEC that the investors are “accredited,” basically wealthy, or otherwise it must go through a long and burdensome process to make an offering to the public. According to one account, Greece has considerably more peculiar requirements:

Antonopoulos and his partners spent hours collecting papers from tax offices, the Athens Chamber of Commerce and Industry, the municipal service where the company is based, the health inspector’s office, the fire department and banks. At the health department, they were told that all the shareholders of the company would have to provide chest X-rays, and, in the most surreal demand of all, stool samples.

Greek banks were not much better:

Once they climbed the crazy mountain of Greek bureaucracy and reached the summit, they faced the quagmire of the bank, where the issue of how to confirm the credit card details of customers ended in the bank demanding that the entire website be in Greek only, including the names of the products.

“They completely ignored us, however much we explained that our products are aimed at foreign markets and everything has to be written in English as well,” said Antonopoulos.

Take this with a grain of salt but the World Bank does rank Greece 135th in the world (186 countries ranked) in ease of starting a business.

1 Ed February 23, 2012 at 7:42 am

I had to click on the link to see what the other fifty countries were, presumably all of which require stool samples in order to start a business, though I didn’t look up the World Bank’s criteria. To save other people the trouble, China came in a # 151 and India at # 166. The lowest four were Eritrea, Haiti, Guinea, and Chad. While the rest of the bottom fifty was made up of the usual poor African and Latin American countries, Spain and the Czech Republic were ranked about even with Greece.

2 Ed February 23, 2012 at 7:44 am

Oh, and the top four are Australia, New Zealand, Canada, and Singapore, which isn’t surprising. I thought the list might be a proxy for corruption and bureaucracy, but Belarus came in at # 9. I still haven’t looked up what the World Bank’s criteria are.

3 improbable February 23, 2012 at 7:53 am

Presumably the Chamber of Commerce would be shocked and horrified by anyone so naiive as to submit stool sample bottles not stuffed with nice clean bank notes…

4 tkehler February 23, 2012 at 11:40 am

I have a good supply of the former and a not-so-good supply of the latter…

5 anon February 23, 2012 at 8:20 am

WSJ had 2 things in the Feb 22, 2102 issue that are relevant:

“A Stock Market for the Rest of Us?”
http://online.wsj.com/article/SB10001424052970203358704577237353576597194.html

mentioning Loyal3,

and several paragraphs from a Walter Russell Meade article in the American Interest:
“Beyond Blue 5: Jobs, Jobs, Jobs”
http://blogs.the-american-interest.com/wrm/2012/02/20/beyond-blue-5-jobs-jobs-jobs/

“Lifetime employment will continue to go the way of the dodo. So will many of the aspects of the employment relationship that went with that. Defined benefit pension programs are already pretty much toast; so too is the implied social contract that the employer, like a feudal lord, would provide lifetime protection and security so long as the employee, like a good and faithful serf, provided labor and loyalty.”

Daniel Pink wrote a book about this in 2001: “Free Agent Nation: The Future of Working for Yourself”

http://www.amazon.com/dp/0446525235?tag=marginalrevol-20

This is what I see happening in my small business, with increasing numbers of well-qualified and affordable freelancers and small businesses providing sophisticated services that 20 years ago were difficult to locate outside of larger organizations.

Feudalism is on its last legs.

6 anon February 23, 2012 at 8:26 am

Sorry, the Feb 22, 2012 issue of the WSJ. Pages A13 and A15.

7 JWatts February 23, 2012 at 12:02 pm

Yes, but a large amount of the population enjoys that kind of security blanket. And the government isn’t currently big enough to employ all of them. So, interesting times are coming.

8 Nick Agron February 23, 2012 at 8:49 am

Typical Greek nationalism from their chauvinistic government and bureacracy. Alex, you haven’t include all the bribaries and all the rent-seeking problems that I assume to exist

9 The Other Jim February 23, 2012 at 9:01 am

I wish Congress had to provide stool samples every time they borrowed money.

10 Tim February 23, 2012 at 9:28 am

Doesn’t the EU have some oversight over national practices in this realm? Competition and so on?

11 Yancey Ward February 23, 2012 at 1:05 pm

Investing in Greece: Only for the Colossally Stupid.

Fixed that heading for ya.

12 Anonymous February 23, 2012 at 4:31 pm

Are Greek islands getting cheaper?

Could be a good platform for a new micronation.

13 Jerry February 24, 2012 at 3:49 pm

Maybe they should just put Greece on Kickstarter…

14 Dave Tufte March 2, 2012 at 9:16 am

There is a 40 year old Monty Python skit that anticipates this …

A man shows up for his appointment with an agent to buy insurance (I think). He has not brought in his urine sample. He asks if they really need 5 gallons, and the agent responds that “no, they just require that to find out if you’re serious.”

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