EU To Greece: "We Want To Help You Help Yourself"... And We Want To Own You After You File For Bankruptcy

Tyler Durden's picture

Well, nobody is leaving the eurozone (as expected), but EU is merely ratcheting up the rhetoric one notch seeing full well what happens to countries that continue to endorse unlimited banker bail outs. And it is likely that the war of words will simply continue escalating until such time as the Greek restructuring becomes inevitable, which will likely happen not sooner than a year from now due to Greek bailout liquidity availability and nobody will push the country to do the inevitable until there is even one spare euro in the coffers for fears of what will happen to Deutsche Bank and the European financial domino. So for those wondering what happened at last night's secret finance minister meeting, one one hand, as Dow Jones reports, Greece "asked its euro-zone partners to ease the country's deficit targets as it struggles to comply with strict austerity terms set under last year's financial bailout agreement, a senior euro-zone government official said Saturday. The senior official said Greece acknowledged that it is unlikely to be able to return to the bond market next year and might need to tap the European Financial Stability Facility, the EU's new bailout fund, for funding. A German proposal to possibly extend the maturities of Greek debt falling due in 2012 also was discussed, this person said. Athens has a long-term borrowing requirement of EUR27 billion in 2012. "Greece has asked for the deficit targets to be eased, specifically to push the budget deficit target of 3% of GDP in 2014 forward by at least two years."" Alas, as expected the latest panhandling attempt by Greece was met with abject failure: "No decisions were taken, according to the Commission's statement. Greece's request for easier terms didn't win the assent of Germany and other participants in Friday's meeting, according to a senior European official." In other words, the country is on autopilot, and possibly worse. Per Bloomberg: "European Union officials may require Greece to provide collateral for aid as policy makers struggle to prevent the euro area’s first sovereign debt restructuring, said a person with direct knowledge of the situation."In other words, for the first time since Weimar, a country may soon be forced to collateralize superpriority debt issuance to foreign creditors: an exercise not really seen in international politics since the Weimar war reparations... and at least Germany had its own currency back then. Summary: the EU just told Greece to prepare for Debtor in Possession loan issuance. Basically should Greece default, and it will, the Parthenon will go to Germany, Santorini will go to Luxembourg, Piraeos will likely end up in IMF hands, and the Chinese will own the rest. Welcome to sovereign debt restructurings for the 21st century.

From Dow Jones:

The ECB, the European Commission, France and others remain opposed to any rescheduling of Greek debt, fearing it could spark worsening capital flight from other indebted euro members and damage the Greek banking system.

"There is strong opposition to this by Trichet," one euro-zone official said, adding that the Greek issue will be "extensively discussed" at the May 16-17 meeting of European Union finance ministers.

These meetings precede the June audits of the Greek government's budget to measure the sustainability of the country's debt load, seen as a key hurdle for Greece's recovery plan.

The Eurogroup's Juncker told journalists after the Luxembourg meeting Friday night that it was decided that Greece needs a further adjustment program, but he excluded restructuring the country's sovereign debt.

The president representing the 17 countries using the euro joined other officials in firmly denying press reports that Greece was considering a withdrawal from the euro zone altogether.

But Juncker said Greece needs a further adjustment program, without furnishing details.

"We are not discussing the exit of Greece from the euro area, this is a stupid idea and an avenue we would never take," Juncker said Friday.

Asked if rescheduling Greek debt to extend maturities also had been excluded, Juncker said: "we have excluded any restructuring of Greek debt."

Some more from Bloomberg with the quote du jour:

“We’ll just have to bite the bullet,” Barthle said in an interview today from his district in the state of Baden- Wuerttemberg. “We need to help Greece help itself. What’s the alternative? We don’t want to be pushed over the edge into restructuring.”

And just how will Greece be helped? Why by collateralizing any new supersenior debt with bits and pieces of its sovereign holdings:

Expanding the 110 billion-euro ($158 billion) lifeline Greece received last year may mean that assets or revenue from asset sales are used to secure extra funds, the person said. Demanding collateral, an idea floated last year by Finland, may help avoid a political backlash against bailouts.

Increasing aid may run into opposition in Germany and Finland, where bailouts have sparked a backlash. Finnish Finance Minister Jyrki Katainen, who suggested seeking collateral for Ireland for its November bailout, is leading talks to form a government that may include the euro-skeptic True Finns party.

As to the whole abandoning the eurozone lunacy: that will never voluntarily happen until Greece has even a cent of taxpayer funded bailout money:

Greek Prime Minister George Papandreou said the report of a possible euro exit was made up and the government was handling the country’s debt in the best way possible, Kathimerini newspaper reported.

Abandoning the euro would have “catastrophic” consequences, Greek Finance Minister George Papaconstantinou told Italian newspaper La Stampa. Public debt would double, consumer spending power would be “shattered” and the country would sink into a “war-like recession,” he said.

Which leaves just one option:

“The likelihood of a restructuring of Greek market debt this year has gone up,” David Mackie, London-based chief European economist at JPMorgan Chase & Co., said in a note yesterday.

Greece has about 330 billion euros in outstanding bonds, according to a May 5 report by UBS AG. The Swiss bank estimates that 22 percent is held by Greeks and Cypriots, the ECB has 19 percent and the EU and International Monetary Fund together have about 11 percent.

About 22 billion euros will mature this year and 33 billion euros next year, according to an April 29 ING Groep NV report.

Greek bonds have declined since the 2010 bailout, with yields on two-year notes reaching a euro-era record of 26.27 percent on April 28. The extra yield investors demand to hold Greek 10-year debt over comparable German bonds widened 4 basis points to 1,233. Greece was supposed to return to markets next year even as its debt peaks at 159 percent of gross domestic product.

So restructuring it is, but not before European bankers show their generosity one more time by funding the Greek DIP loan which in one year will give them a first lien on all the assets used as collateral, probably at a blue light special LTV valuation. We hope Portugal and Ireland are watching and learning how the ECB has commenced the process of peacetime reparations.

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RaymondKHessel's picture

Greece is da word is da word is da word

tictawk's picture

Congratulations Tyler, you were mentioned on the Rush Limbaugh show for your very informative Zero Hedge blog.  Rush is my favorite talk radio hosts and has about 20 million listeners.  I am sure traffic to ZH will increase.  Many thanks for the great work you do here.  

oldmanagain's picture

I am sure Tyler wil love being associated with a racist, facist, idiot.

ZeroPower's picture

Dont you have BenBucks to donate to obamao or something?

Ahmeexnal's picture

Greece is under invasion, live footage of german elite KSK special force commandos storming Greece:

topcallingtroll's picture

Racist? Hardly. Disagreeing with socialist ghetto dwellers is not racism. Failure to have sympathy for poor ethnic groups is not racism either.

Fascist? No doubt at all about that.

Idiot? Hm......he sure made a lot of money for being such an idiot!

downwiththebanks's picture

People who "make" money can't be idiots?  

The world was a better place when he was introducing the KC Royals.  The fact that a handful of corporate banker-gangsters will stand by an ignorant bloviating drug-addict hardly makes him special.

Good whores whore themselves out successfully - doesn't make 'em bright.  Just makes them good whores.

Canucklehead's picture

Whoa, go easy there big fella... You're doing all the heavy lifting while we watch you work your magic; Thanks for the original thoughts.  I've never heard it put that way before.

eurusdog's picture

+100, it has always suprised me that many of those that comment on ZH, support those idealogs that get their funding from the same people that support the people casuing the problem. That is, anyone in government, dem or repub. But then again, they all come up with such clever names to fling at eachother, monkey throwing shit!

dark pools of soros's picture

they should all be forced to read the Dogma chapter in Parsson's "Dying of Money"


anyway, Greece will lose everything to foreign owners like Slovakia

tired1's picture

I just listen to all these guys for what is not being said. The omissions are always more interesting.

nah's picture

Rush limbah rite

the facist guy that sucks BP cock as their WMD errupts on our shores?

sun tzu's picture

race card - check

nazi card - check

name calling - check


I'm not a Limbaugh fan, but this racism/nazi card has worn thin.

disabledvet's picture

how 'bout banana hammocks?

TGR's picture

I didn't junk you, but isn't that just a fancy term for 'budgie smugglers'? Not quite in the same league as nazism/racism as a veiled insult or a term that leads to Godwin's Law manifesting...unless that is the whole irreverent point of your suggestion...

Bob Sacamano's picture

Name calling is required in 41% of the posts on this site -- sorry, it seems to be a requirement.   And marginalizes the site. 

But it gives you a pretty good look at the intellect level of people in general -- fairly hollow arguments. 

But that's ok.  Just need to factor that abundant character trait in making money trading and investing.  Sadly though, many of these folks will expect someone else to take care of them (and TPTB are inclined to provide).

The Alarmist's picture

You actually calculated the percentage of name-calling-posts, you Nerd!

ISEEIT's picture

You sicko Alinsky freaks ought to just do to yourselves what you so fervently desire to have done to others.

Disagreeing with radical leftist IS NOT RACIST.


Number 156's picture

I am sure Tyler wil love being associated with a racist, facist, idiot.


You know what, This is the one thing I hate about ZH. There are people out there with such a political bent. Who cares if you like Rush Limbaugh or not? Its going to bring more traffic to ZH. If he was mentioned on Daily Kos, would it make you feel any better? It wouldnt bother me. Who cares what anyone thinks, a win is a win.

Lets see, They have had a republican, and a democrat in the White house, however I see the same policies. The Tea party? It will be the same, trust me. So throw away your party politics, and embrace your new-found identity, one far removed from the idiocy and insanity that's sending the whole world headlong into the abyss.


dogbreath's picture

Whenever I see Steve Liesman on some linked clip I think I am looking at Rush 

breezer1's picture

i'm so glad rush is finally out of the closet. maybe now he will finally be able to give up those drugs and truly recover.

downwiththebanks's picture

How's our favorite drug addict doing these days?

Isn't the Oxy-contin geek in jail?   Oh yeah - rich white drug addicts don't go to jail.

sun tzu's picture

He's doing fine. Playing basketball at the white house, bailing out Wall Street, bombing Libya, and faking raids into Pakistan.

I believe it was coaine and heroin, not oxy. He's only half-white. His father is Kenyan.

Funny how people are so obsessed and raging at the talking heads on CNN/Fox/MSNBC/radio when the real enemy is in government screwing us over. None of those talking heads started wars or approved the bailouts.

downwiththebanks's picture

No - the real enemy is the banker-gangster cabal to whom you whore yourself.  

Reality aside - you believe that puppets run the puppet show because you're paid to do so. 

sun tzu's picture

The banksters are the men pulling the strings. The corrupt politicians are their paid henchmen. Once we get rid of their henchmen, they have no defense. Default on all debt owed to the Fed. Fuck them.


You need to get over your obsession with whores and hookers

downwiththebanks's picture

And you need to stop diminishing the role played by the psychopathic banker-gangsters, who have run this system into a state of terminal decay.  You treat death panels for grandma as a fait accompli without even approaching to the root of our economic crisis.

Later you backtrack in order to establish some anti-banker credibility - that's not the point.

Old Poor Richard's picture

The unions and the banksters and the corporations and the politicians are all members of the same institutional cabal.  They act like they're a superior animal, homo ultimus, and they hate lowly homo sapiens. 

Petty partisan politics is where everyone fails.  Either you're an individualist, or a Party member. 

McPoopypants's picture

"I am sure traffic to ZH will increase.  Many thanks for the great work you do here. "



Good god, I hope not.

Muir's picture

Well, fuck it.


Well get more fucking inbred retards.

"One of the websites that I keep track of on matters of economics is a place called, and there's a poster there by the name of Tyler Durden who occasionally posts some interesting stuff.  For example, "Today's Bureau of Labor Statistics number 244,000 jobs is great until you exclude the 62,000 from McDonalds hirings, and 175,000  from the Birth Death Adjustment." The net new jobs in the private sector is 7,000.  That's the net new jobs.  "


explains some of the recent idiocy

firstdivision's picture

Oh please God no!  Do not need more idiots here that believe in political divisions that were created to divert the attetion of the masses while being robbed by both sides. 

I miss when this site's commentariat would focus on the financial aspect of the worlds problems with good debate.  Now too many people that are left/right wing nut jobs are here and blame politicians.  All the good debate is gone.  I do not know why those with strong political ties/opinions come here in that all analysis has no policital motivation behind it.  This site is about educating/disseminating information in a neutral light. 

Speaking of which, the comments lately, remind me of the stuff I read on here

Zero Govt's picture

Americans are being robbed by two colours of parasites and judging by the above they're so screwed up they're actually picking sides rather than identifying it's two sides of the same target

no wonder you're at war with everybody including yourselves, you're all too dymb to identify the fuking enemy! 

topcallingtroll's picture

The tea party is as close as you will get to zero government.

They alone want to kill off most of the federal government. I daresay they would end federal income taxes if they could get away with it.

There are real differences. Long live the tea party!

Bobbyrib's picture

Those misguided morons would probably try to institute a flat tax. Then we could have almost equal taxes liabilities with a vast difference in the distribution of wealth. Hopefully after the flat tax is instituted we could invade a country that had nothing to do with 9/11(clearly a government conspiracy) then give Haliburton a no bid oil contract.

Id fight Gandhi's picture

Rush is ok, been listening to him on and off for 19 years now. He used to be only source of non liberal spin around before the the Internet web.

I doubt that most of his listeners would keep u with zh info, too over their heads. But still good to get mention. Good job!

Shows that this isn't a fringe website if someone as respected as rush sites it!

Muir's picture

"if someone as respected as rush sites it!'

You gotta be fucking kiddin me.

At least I hope so, you genetically inbred mutated second generation West Kentucky coal miner offal.

Then again maybe I missed the /sarc switch, my bad


Re-Discovery's picture

Rush Limbaugh is as much a fool as any of them.  Any 'edge' he once had has been dulled by too much food, drugs and adulation.  He is neither right nor left wing.  He is a slightly louder mainstream member of the "chicken" wing.

Sophist Economicus's picture

Hey RaymondKHessel,


I think the song goes more like:


"WAR, what is it good for, absolutely nothin' "....except extracting pounds of flesh.   I just hope we get the hell out of NATO before these idiots start killing themselves again.   

Weisbrot's picture

looks like the lazy are beating the industrius.... at least for now....

ZeroPower's picture

Woulda, coulda, shoulda. 

Default now Greece, come on.

WestVillageIdiot's picture

As much as I hate the financial gangsters it is tough to conjure up a lot of sympathy for countries like Ireland and Greece.  I think they should default.  But let us not forget that they were nothing more than HELOC'ers on a massive scale.  They liberated their equity and now they can't pay.  The stories out of Ireland in 2006 made Florida look sane. 

disabledvet's picture

did they buy the debt or did the countries up tot their eyeballs lending to these countries buy the now worthless debt? I say the latter.  That makes this more about "scents" than "cents."  Ask for another bailout...and another and another--and then marry some rich guy (girl?) and call it a life.

Weisbrot's picture

we will all find out all too soon just how long and how strong a corrupt government is and can last. Vote Out The Encumbants.... at least the corrupt ones anyway...

downwiththebanks's picture

No - default, banker-gangsters.   Greece should tell them to get fucked, and see how that affects their little paper portfolio.

And when the banker-gangsters die off, Greece will still be there.

live free's picture

And so we now know and enter the true end game.... Where the bankers take posession of countries. 

It all makes sense now. I read an article that mentioned this a few months ago, and thought it was a very interesting take... now it's coming to fruition...

Debt terrorism has been pushed on more and more... finally the banks swoop in to take "their property" and we are all f*cked.  Watch for this more, now that it's real

Good luck all...


trav7777's picture

"end" game?  this has been the IMF's pursuit for 50 years.  They have busted out so many sovereigns with debtmoney...actually this crap goes back to the South Seas Bubble and even further.  The Bank of England's very existence is for this purpose.  It's to lend money at compound interest to people who DON'T UNDERSTAND MATH.  That is the entire point.

Take a look at the role of the usury clan in the weimar period.  They came out the other side owning the entire Reich.  Inflation then deflation...jfc, Thomas Jefferson was talking about this crap over 200 years ago.

Why does everyone THINK that the usury clan has been so historically hated?  Why does everyone THINK usury and lending at interest was prohibited for so long? 

cosmictrainwreck's picture

And rates-going-up next round, bitchez. The higher, the better