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the debt is the REAL portion
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Yes, the debt is real, but in "real" terms it's nothing more than 1' and 0's i.e. there's nothing defining the debt...no exchange of solid physical currency like real money or gold. Here, I'm talking about countries, not individual people (individual debts are very real!!). They trade the debt through an exchange of promisary notes, no real currency is exchanged and in any case there's usually not enough there to cover it. It's like one big IOU. That's what I meant... they may owe "X" amount, but it's nothing more than an IOU. How could you even begin to cover the billions of dollars that they rake up with real money, and they keep going further into debt which makes the task well nigh impossible. They don't have enough tangible assets (in hard currency) to back themselves. In other words, the lenders may be owed "X" but they'll never get it back. It eventually becomes meaningless.
Fractional Reserve Lending is a joke. It's one big reason why countries become as stuffed up as they do. You end up running up a debt you just can't and could never cover. You can do a lot with something which doesn't really exist (the money). Only problem is it comes back one day and bites down on your rear very hard.
Problem with Greece is they owe more than their economy's worth ($372 billion versus $365 billion). They might as well just declare themselves bankrupt and try and trade out of it, but that's going to take years, so they'll borrow more (non existent) money to pay off ever increasing debt (or, I'll give you another IOU and we'll leave it at that
). Crazy!!!.