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[Theonik]

Hats.

Dogecoin

 

[Joni]

VF wrote apiece on the Guardian yesterday that suggested Germany had already decided for a Greek exit by the time they got around to this last round of negotiations.

Very probable. You prepare for the worst case scenario and anything better is good.

I guess it's possible that Syriza are betting that if this is the case, they can appear to give Germany what it asks for and then when they are forced out regardless it will be plain as day that Germany is running the show for it's own ends.

There only seems to be one plan with that strategy: they have already sold out their population. The majority of their members signed on to the deal. They either have to admit on gambling on the faith of their nation, or have to admit that they were planning to capitulate and go against their entire philosophy anyway. The deal imploding doesn't reflect too kind on the fact that they did exactly what they promised they wouldn't do. Getting the bailout and getting the economy back on their feet is a lot more profitable for their chances at re-election than failing to get an even worse plan passed.

 

[cyberheater]

I'm finding it hard to keep up.

Doesn't Greece have to make a big payment by Sunday?

 

[Deleted member 231381]

I'm finding it hard to keep up.

Doesn't Greece have to make a big payment by Sunday?

They face repayments on the 13th to the IMF, which they'll just ignore, and private creditors on the 17th, which they'll repay with their last remaining funds and help from the ELA. Then's the 20th, which is their repayment to the ECB. They can choose not to pay this, but the ECB would force them to make that an immediate default on the ECB, rather than accepting arrears status like the IMF. The final straw would be on the 7th of August, when they have to repay private creditors and would have no Euros with which to repay Euro denominated debts because the ECB isn't supporting them. Effectively, the 20th marks the point of no return, but the actual default effect rather than just status would kick in properly on the following 7th.

If they do stay in, their final debt repayment schedule as of today is April 28, 2054 - i.e., if the Greek government ran a primary surplus (i.e., including debt repayment in full) every year between now and then, they'd be expected to have returned their GDP to debt percentage to 0% by 2054. Obviously nobody is expecting them to return to 0%, though, just 60%.

The ECB is not willing to help Greece unilaterally because of political pressure, so Greece has to get funds from the European Stability Mechanism (ESM) instead. Use of the ESM requires assent from each of the capital contributors to the ESM, which is the other Eurozone countries. The actual procedure to give assent varies by country - most can do it executively, but a few like Germany require legislative assent. The final meeting to discuss Greek proposals is on Sunday to give time for the various countries involved to decide whether they want to support an ESM measure, so at the very least Greece needs assent from the various European executives on Sunday or they can't repay the ECB on the 20th and go bust.

It's by no means the end of the story, though, as it is feasible that, say, the Estonian Prime Minister could approve on Sunday, return to Estonia, and have the measure defeated in parliament.

 

[Rafy]

I heard from a friend that there was a 2-way Bitcoin ATM installed in Athens, is that true?

 

[Joni]

Sunday is also marked as important because a European Union meeting is scheduled which is rumoured to be about the workings of a Grexit within the European Union framework if the Eurozone doesn't find an agreement.

 

[2MF]

Let's ignore for a second that Greece appears to have capitulated and ignored the referendum results (it's up to the Greeks to revolt if they feel strongly about that).

How will an extra 60 billion € in debt make their situation any more sustainable? Wouldn't that immediately kick their debt-to-GDP ratios to 200% or something around that? That is unless most of the bailout is immediately used to pay back some huge loans that are due soon (which I doubt is the case, especially since there's also talk of extending debt maturities).

Seems to me like making a bad situation worse, same old "extend and pretend" from the last 5 years. If the other European countries agree to this and add 60 billion € of risk to their own taxpayers' backs they'll have no one to blame but themselves in a few years when yet again it gets proven that Greece has no ability to pay the debt back.

PS: Another thing which is really worrying are the demographics trends in Southern Europe - very low birth rates and emmigration to other countries resulting in a double-whammy of aging population and decreasing population. This will make debts even more unsustainable, resulting in the destruction of the countries' prospects

 

[MrKaepora]

So the past few weeks can be summarized as:

Troika: Last, best offer.
Greece: No.
Troika: It's going to expire.
Greece: Fuck it. REFERENDUM!
***Greece Votes***
Greece: NO TO TROIKA!!!!
Troika: Looks like you guys are dropping the euro. Good luck with the drachma.
Greece: Shit. Um, guys, that last offer was pretty good.
Troika: We need to make some changes because things have gotten worse.
Greece: Whatever you say boss.
...
Greece: DEAR CITIZENS! WE WON!!!

Yep, seems like a good resume of things so far. So much shitstorm to keep things the way they were if not worse.

 

[Deleted member 231381]

Let's ignore for a second that Greece appears to have capitulated and ignored the referendum results (it's up to the Greeks to revolt if they feel strongly about that).

How will an extra 60 billion € in debt make their situation any more sustainable? Wouldn't that immediately kick their debt-to-GDP ratios to 200% or something around that? That is unless most of the bailout is immediately used to pay back some huge loans that are due soon (which I doubt is the case, especially since there's also talk of extending debt maturities).

Almost all of the bailout is being reduced to pay past loans, so the debt-to-GDP ratio remains basically the same. The difference is the interest rates on the bailout are a long way below the market value, so it gives Greece a bit more leeway. The problem at the moment is Greece is caught in a debt trap - all the money they raise is just enough to pay back the interest rate, with little left. With the same amount of debt but lower interest repayment, they could technically pay it back within four decades. It's more or less a continuation of the status quo, though, you're quite right.

Seems to me like making a bad situation worse, same old "extend and pretend" from the last 5 years. If the other European countries agree to this and add 60 billion € of risk to their own taxpayers' backs they'll have no one to blame but themselves in a few years when yet again it gets proven that Greece has no ability to pay the debt back.

Yup. As far as I am concerned, on the basis of the current deal, we'll be re-opening this thread on an almost word-for-word basis in 4 years time.

PS: Another thing which is really worrying are the demographics trends in Southern Europe - very low birth rates and emmigration to other countries resulting in a double-whammy of aging population and decreasing population. This will make debts even more unsustainable, resulting in the destruction of the countries' prospects

I'd stop having children and consider emmigrating when the financial situation was this bad, too. It's a pretty logical response, and you're right - a big problem is that Greece's brightest and best don't want to be in Greece right now.

 

[PJV3]

You think they could make it to 4 yrs?
I just can't see the people being able to take it, perhaps i'm being too negative then.

 

[2MF]

I'd stop having children and consider emmigrating when the financial situation was this bad, too. It's a pretty logical response, and you're right - a big problem is that Greece's brightest and best don't want to be in Greece right now.

Indeed! And the "funny" thing is that other European countries often get an educated worker for free, whose education was paid by Greece (assuming that subsidized higher education is the norm there, as in many other places in Europe).

 

[KingSnake]

Yeah, without any kind of debt relief this is just buying time until the next similar situation. That's why I'm very curious about Germany's position regarding this. If they deny the debt relief but accept the new loan they are practically lying to German citizens, because they will just throw more money into the endless pit. And they know it very well, Schäuble admitted it this week.

And without debt relief I don't think it will last 4 years until the next crisis situation. I give it 2 years, at most. And Greece will continue to be into default, de facto and part of a Ponzi scheme.

Edit: oh, yeah. I can't wait for the future complain about the influx of Greek workers in the countries complaining now about the lazy Greeks.

 

[Deleted member 231381]

You think they could make it to 4 yrs?
I just can't see the people being able to take it, perhaps i'm being too negative then.

Depends. The current bail-out plans are supposedly enough to tide Greece through four years, but the growth estimations are... pretty optimistic.

 

[norinrad]

At the end of the day i would prefer France leaves the Euro, their plan to control Europe has failed, they may as well pack up and go. If anything France should be the one being forced to reform their economy and not Greece.

Those who thought they could control a unified Germany when at that time they could barely contain West Germany probably did not think the whole thing through.

 

[Deleted member 231381]

At the end of the day i would prefer France leaves the Euro, their plan to control Europe has failed, they may as well pack up and go. If anything France should be the one being forced to reform their economy and not Greece.

Those who thought they could control a unified Germany when at that time they could barely contain West Germany probably did not think the whole thing through.

There's probably some wise Chinese proverb I could find that would help you experience posting enlightenment, but failing that I'm going to go for "please stop posting".

 

[oti]

At the end of the day i would prefer France leaves the Euro, their plan to control Europe has failed, they may as well pack up and go. If anything France should be the one being forced to reform their economy and not Greece.

Those who thought they could control a unified Germany when at that time they could barely contain West Germany probably did not think the whole thing through.

Yay, let's get that good ol' Germany-France rivalry going on again. That was so much fun in the past, wasn't it?

 

[cyberheater]

They face repayments on the 13th to the IMF, which they'll just ignore, and private creditors on the 17th, which they'll repay with their last remaining funds and help from the ELA. Then's the 20th, which is their repayment to the ECB. They can choose not to pay this, but the ECB would force them to make that an immediate default on the ECB, rather than accepting arrears status like the IMF. The final straw would be on the 7th of August, when they have to repay private creditors and would have no Euros with which to repay Euro denominated debts because the ECB isn't supporting them. Effectively, the 20th marks the point of no return, but the actual default effect rather than just status would kick in properly on the following 7th.

What a informative and comprehensive answer. Thanks.

 

[oti]

As far as I can tell from my surroundings, most Greeks abroad are disappointed by Tsipra's u-turn and most Greeks in Greece are OK with it.

 

[Theonik]

At the end of the day i would prefer France leaves the Euro, their plan to control Europe has failed, they may as well pack up and go. If anything France should be the one being forced to reform their economy and not Greece.

Those who thought they could control a unified Germany when at that time they could barely contain West Germany probably did not think the whole thing through.

West Germany had to spend and still spends tons of money unfucking East Germany.
The Euro ended up helping them regain their strength though rather than the other way around.

 

[Deleted member 231381]

As far as I can tell from my surroundings, most Greeks abroad are disappointed by Tsipra's u-turn and most Greeks in Greece are OK with it.

I can't blame them. I think that it is very, very probable a Grexit would be better at this point, but the oldest and strongest emotion of mankind is fear, and the oldest and strongest kind of fear is fear of the unknown.

 

[norinrad]

There's probably some wise Chinese proverb I could find that would help you experience posting enlightenment, but failing that I'm going to go for "please stop posting".

Go ahead and look it up. With all the problems the poor Greek citizens are facing, who says the other weaker countries won't be next? All because France wanted some stupid currency union.

 

[2MF]

What a informative and comprehensive answer. Thanks.

See also this chart / table from the WSJ:

http://graphics.wsj.com/greece-debt-timeline/

 

[PJV3]

Depends. The current bail-out plans are supposedly enough to tide Greece through four years, but the growth estimations are... pretty optimistic.

Yeah the estimates have been pretty wide of the mark since this whole nightmare began.

Yay, let's get that good ol' Germany-France rivalry going on again. That was so much fun in the past, wasn't it?

The French have at least tried to be constructive, i'm not sure why he wants them out.

 

[KingSnake]

Go ahead and look it up. With all the problems the poor Greek citizens are facing, who says the other weaker countries won't be next? All because France wanted some stupid currency union.

Euro served Germany more since the beginning. Germany had the stronger currency and euro helped tremendously with their export based economy. France's economy is quite neutral towards euro. Look it up.

The French have at least tried to be constructive, i'm not sure why he wants them out.

Because when you can no longer blame the Greeks you have to blame somebody else.

 

[Reuenthal]

West Germany had to spend and still spends tons of money unfucking East Germany.
The Euro ended up helping them regain their strength though rather than the other way around.

I have a Germancypriot relative who migrated young in Germany and made his life there. And a lot of the shit we hear from Germans about Southern Europeans he was saying about Eastern Germans in about 10 years ago, and how he didn't like that West Germans had to pay for them. And he wasn't speaking from the perspective of I, but of the view of we in western Germany, it was apparent his views had some popularity. So even in the case of Eastern Germany, the West Germans helped, but helped with reluctance and some anger. But in the end they did it because the Eastern Germans were also Germans. So in some regards what happened next in Europe and the attitudes towards Southern European countries and Greece in particular make sense looking back at those attitudes.

 

[le-seb]

Because when you can no longer blame the Greeks you have to blame somebody else.

Some French cheese wheel probably rolled all over his tulip field.

 

[cyberheater]

See also this chart / table from the WSJ:

http://graphics.wsj.com/greece-debt-timeline/

Thanks. That's a good chart.

It really show how fucked the Greeks are. Looks like a generation of austerity.

 

[Deleted member 231381]

Thanks. That's a good chart.

It really show how fucked the Greeks are. Looks like a generation of austerity.

Closer to two, and more if the growth estimates don't hold (they won't).

 

[Theonik]

I have a Germancypriot relative who migrated young in Germany and made his life there. And a lot of the shit we hear from Germans about Southern Europeans he was saying about Eastern Germans in about 10 years ago, and how he didn't like that Western Germans had to pay for them. And he wasn't speaking from the perspective of I, but of the view of we in western Germany, it was apparent his views had some popularity. So even in the case of Eastern Germany, the Western Germans helped, but helped with reluctance and some anger. But in the end they did it because the Eastern Germans were also Germans. So in some regards what happened next in Europe and the attitudes towards Southern European countries and Greece in particular make sense looking back at those attitudes.

Nah, they were pretty much forced to. Had the West Germans actually been asked to they wouldn't have helped. That much is clear. The us and them and discrimination and poorer standing of East Germans still stands to this day.

As far as I can tell from my surroundings, most Greeks abroad are disappointed by Tsipra's u-turn and most Greeks in Greece are OK with it.

Greeks abroad want an unfucked country in the long run since they can wait it out abroad. Greeks in Greece have to worry if their savings are OK and whether they will have food to eat for the next few months.

It makes perfect sense.

 

[nature boy]

Wait, Varoufakis went on "vacation"?

What a narcissist fuck.

Not sure if posted, but this is an interesting read from the head economist at the IMF:

http://blog-imfdirect.imf.org/2015/07/09/greece-past-critiques-and-the-path-forward/

 

[2MF]

Greeks in Greece have to worry if their savings are OK and whether they will have food to eat for the next few months.

That reminds me - one thing which will be interesting to look at, provided that the new European bailout is approved, is whether any Greeks will ever leave money again in a Greek bank.

There has already been huge deposit flight for the last few years, but now even the least financially-knowledgeable Greeks can plainly see that having your money stuck in Greece is a recipe for not being able to access it for weeks at a time. It's hard to see most people not finding a bank abroad or relying on their mattress/safe to stuff their cash in. Sure, pensions and salaries might be paid out to a Greek bank but that doesn't mean the money needs to stay there for more than a day.

 

[Deleted member 231381]

Wait, Varoufakis went on "vacation"?

What a narcissist fuck.

Not sure if posted, but this is an interesting read from the head economist at the IMF:

http://blog-imfdirect.imf.org/2015/07/09/greece-past-critiques-and-the-path-forward/

That's actually a surprisingly well-argued case. I might type up a response post, in a mo, but it's worth reading regardless.

 

[Theonik]

There has already been huge deposit flight for the last few years, but now even the least financially-knowledgeable Greeks can plainly see that having your money stuck in Greece is a recipe for not being able to access it for weeks at a time. It's hard to see most people not finding a bank abroad or relying on their mattress/safe to stuff their cash in. Sure, pensions and salaries might be paid out to a Greek bank but that doesn't mean the money needs to stay there for more than a day.

That's why capital controls won't be lifted overnight but be phased out as the market calms down.

 

[My words exactly!]

Let's ignore for a second that Greece appears to have capitulated and ignored the referendum results (it's up to the Greeks to revolt if they feel strongly about that).

How will an extra 60 billion € in debt make their situation any more sustainable? Wouldn't that immediately kick their debt-to-GDP ratios to 200% or something around that? That is unless most of the bailout is immediately used to pay back some huge loans that are due soon (which I doubt is the case, especially since there's also talk of extending debt maturities).

Seems to me like making a bad situation worse, same old "extend and pretend" from the last 5 years. If the other European countries agree to this and add 60 billion € of risk to their own taxpayers' backs they'll have no one to blame but themselves in a few years when yet again it gets proven that Greece has no ability to pay the debt back.

PS: Another thing which is really worrying are the demographics trends in Southern Europe - very low birth rates and emmigration to other countries resulting in a double-whammy of aging population and decreasing population. This will make debts even more unsustainable, resulting in the destruction of the countries' prospects

Indeed! And the "funny" thing is that other European countries often get an educated worker for free, whose education was paid by Greece (assuming that subsidized higher education is the norm there, as in many other places in Europe).

Yeah, without any kind of debt relief this is just buying time until the next similar situation. That's why I'm very curious about Germany's position regarding this. If they deny the debt relief but accept the new loan they are practically lying to German citizens, because they will just throw more money into the endless pit. And they know it very well, Schäuble admitted it this week.

And without debt relief I don't think it will last 4 years until the next crisis situation. I give it 2 years, at most. And Greece will continue to be into default, de facto and part of a Ponzi scheme.

Edit: oh, yeah. I can't wait for the future complain about the influx of Greek workers in the countries complaining now about the lazy Greeks.

Great posts.

Anyway, let's play spot the differences:

 

[cyberheater]

Closer to two, and more if the growth estimates don't hold (they won't).

So 50/60 years of tightening the belt. Whole generations living in poverty.

Who are responsible for this and why are they not in jail?

 

[M°°nblade]

If Syriza is betting that a Greece outside the Eurozone will need to have strong allies within it eg. a Podemos Spain and an SF Ireland etc. then I guess it makes sense that they will take this risk to orchestrate a Grexit that benefits anti-austerity int he rest of Europe the most and damages Germany's reputation the most.

Syriza wasn't given a mandate to orchestrate a grexit. They know this.

 

[petran79]

I have a Germancypriot relative who migrated young in Germany and made his life there. And a lot of the shit we hear from Germans about Southern Europeans he was saying about Eastern Germans in about 10 years ago, and how he didn't like that West Germans had to pay for them. And he wasn't speaking from the perspective of I, but of the view of we in western Germany, it was apparent his views had some popularity. So even in the case of Eastern Germany, the West Germans helped, but helped with reluctance and some anger. But in the end they did it because the Eastern Germans were also Germans. So in some regards what happened next in Europe and the attitudes towards Southern European countries and Greece in particular make sense looking back at those attitudes.

East Germans after unification were also more racist towards foreigners.
When we lived in West Germany there was such a family.
There lived also an old German lady who was born in Silesia,Poland and was forced to immigrate. She was friendly with foreigners because she knew how it felt.

 

[Napalm_Frank]

Can't wait for the mental gymnastics when Finland passes the deal in parliament. Government programme says that they will view any further deals with Greece ect. negatively and one of the 3 parties in the government has pretty much gained most of its following by being the only eurosceptic option.

Greece is far from the only country whose democratic process is having a punch in the face thanks to this madness.

The only way this makes any sense to me is if behind the closed doors there have been serious talks of a true fiscal union going foreward (not happening+no thanks) or it's to ensure more controlled enviroment for a planned Grexit (not happening).

 

[Negotiator]

i hope Greece is printing and warehousing an alternative currency.

How are they gonna keep that a secret?

 

[KingSnake]

All the stupid and inflammatory statements made in the past 2-3 weeks on both sides will make everybody looking stupid if the deal is closed. The spin will be strong with everybody. Syriza already started it, but Germany, Netherlands, Estonia and Finland will follow.

 

[Xando]

Can't wait for the mental gymnastics when Finland passes the deal in parliament. Government programme says that they will view any further deals with Greece ect. negatively and one of the 3 parties in the government has pretty much gained most of its following by being the only eurosceptic option.

Greece is far from the only country whose democratic process is having a punch in the face thanks to this madness.

The only way this makes any sense to me is if behind the closed doors there have been serious talks of a true fiscal union going foreward (not happening+no thanks) or it's to ensure more controlled enviroment for a planned Grexit (not happening).

Everyone not being a politician is basically getting fucked by this. Greeks because they get more austerity and other europeans because there will be a 4th and 5th package.

They need a solution thats ends this either by Grexit or opening a transfer union + debt cut.

 

[2MF]

http://www.reuters.com/article/2015/07/11/eurozone-greece-germany-idUSB4N0Z802G20150711

Germany says result of finmins' Greece meeting 'completely open'

Spokesman Frank Paul Weber declined to comment on a report in Germany's mass-selling Bild daily that German Finance Minister Wolfgang Schaeuble regarded Athens' proposals as "inadequate" and opposed further talks.

How credible is the Bild ?

edit - not very, it seems...

 

[Deleted member 231381]

Not very, but on this specific issue I suspect they're probably accurate.

 

[Napalm_Frank]

Everyone not being a politician is basically getting fucked by this. Greeks because they get more austerity and other europeans because there will be a 4th and 5th package.

They need a solution thats ends this either by Grexit or opening a transfer union + debt cut.

The thing is it's next to impossible to pass a working union nowdays when eurosceptic movement is at an all time high and most of the major players don't want to truly force a Grexit because it would be pretty much admitting they were wrong/bullshitting the last 5 years (especially the countries that had no big risks in Greece in the first place like Finland but joined the circus all the same).

It feels like everybody will try to continue the status quo until the system collapses.

 

[ClosingADoor]

Yay, let's get that good ol' Germany-France rivalry going on again. That was so much fun in the past, wasn't it?

It's almost as if the earlier ECSC from which the EU later came was specifically founded to keep those two from going to war. How soon people forget.

 

[Xando]

Financial ministers arriving at EG meeting.
http://en.protothema.gr/watch-eurogroup-arrivals-for-meeting-on-greece-live-streaming/

 

[Deleted member 231381]

According to the Greek newspaper, Kathimerini, Tsipras is not expecting his government to last beyond the end of August.

 

[Acorn]

According to the Greek newspaper, Kathimerini, Tsipras is not expecting his government to last beyond the end of August.

Golden Dawn and EU exit inbound

 

[KingSnake]

According to the Greek newspaper, Kathimerini, Tsipras is not expecting his government to last beyond the end of August.

So who will pick up the slack? Communists or Golden Dawn?

 

[ElTorro]

Yeah, without any kind of debt relief this is just buying time until the next similar situation. That's why I'm very curious about Germany's position regarding this. If they deny the debt relief but accept the new loan they are practically lying to German citizens, because they will just throw more money into the endless pit. And they know it very well, Schäuble admitted it this week.

I don't think that Germany ever intended to really deny a debt relief. They just want to sweep the issue under the rug for now to not piss off their electorate.

Let's not forget that this debt relief issue, at the moment, is entirely political and has nothing to do with the economic situation in Greece. The debts we are talking about don't have to be paid back before 2022 anyway. They have nothing to do with why the Greece economy collapsed or why it doesn't get back on its feet. The Greek government wants to have it right now as a political trophy. Conversely, the creditors don't want to tell everyone that much of the money is gone and that they knew it all along.

Greece already got a de-fact debt relief of, AFAIK, over 100 billion euros in 2012, and it didn't magically kickstart their economy.