Troica Demands Deep Public Sector Cuts, Higher Taxes As Part Of Greek Bailout #2, Or My Big Fat Greek Anschluss

Tyler Durden's picture

So here it is:

  • EU, IMF: GREECE NEEDS TO REINVIGORATE STRUCTURAL REFORMS (so, fire more people and generate more GDP with whoever is left?)
  • EU, IMF: GREECE TO REDUCE TAX EXEMPTIONS, RAISE PROPERTY TAXES (So, generate more GDP by taxing people more?)
  • EU, IMF: `AMBITIOUS' MID-TERM PLAN, WILL MEET 2011-2015 TARGETS (If the targets are all Greek bankruptcy, yes)

And now, the people get angry. Expect live webcast from Syntagma square shortly.

Full release:

3 June 2011 - Statement by the European Commission, the ECB and the IMF on the Fourth Review Mission to Greece

Staff teams from the European Commission (EC), European Central Bank
(ECB), and International Monetary Fund (IMF) have concluded a mission to
Greece to discuss recent economic developments and policies needed to
keep the country’s economic program on track. The mission has reached
staff-level agreement with the authorities on a set of economic and
financial policies needed to meet program objectives. Strict
implementation of these will help to restore fiscal sustainability,
safeguard financial sector stability, and boost competitiveness to
create the conditions for sustained growth and employment.

Overall, significant progress, in particular in the area of fiscal
consolidation, has been achieved during the first year of the adjustment
program. However, reinvigoration of fiscal and broader structural
reforms is necessary to further reduce the deficit and achieve the
critical mass of reforms needed to improve the business climate and pave
the way for sustainable economic recovery.

Regarding the
outlook, the recession in 2010 was slightly more
pronounced than what was anticipated. But there have been encouraging
signs recently, in particular a notable pick-up in exports. Unit labour
costs are set to decline further, supporting the strong export dynamics,
and inflation is on a declining trend. We expect the economy to
stabilize at the turn of the year.

In the
fiscal area, further sustained deficit reduction will
require comprehensive fiscal structural reforms. The government has
committed to an ambitious medium-term fiscal strategy that will enable
it to maintain its 2011 and medium-term fiscal targets. This strategy
includes a significant downsizing of public sector employment,
restructuring or closure of public entities, and rationalization in
entitlements, while protecting vulnerable groups. On the revenue side,
the government will reduce tax exemptions, raise property taxation, and
step up efforts to fight tax evasion.

The government is committed to significantly accelerate its
privatization program. To this effect it will create a
professionally and independently managed privatization agency, and has
drawn up a comprehensive list of assets for privatization with the aim
of realizing revenues of EUR 50 billion by the end of 2015. The
government will assess progress against intermediate quarterly and
annual targets.

In the
financial sector, liquidity remains tight, but policies
are in place to ensure adequate liquidity provision for the banking
system. The banking sector remains fundamentally sound and the
authorities are increasing capital requirements to further strengthen
capital buffers, giving priority to private market-based solutions.
However, the Financial Stability Fund is available as a backstop for
viable banks that cannot raise capital in the private market.

Further progress has been made with
structural reforms. Legislation to modernize public
administration, reform healthcare, improve the functioning of the labor
market, remove barriers to setting up and operating a business and
liberalize transportation and energy has already been passed or is
underway. The government will continue to push ahead in these areas,
with a particular emphasis in coming months on growth-drivers such as
reviving the tourist industry and removing administrative barriers to
exports. To make sure that the reform frameworks are effective as soon
as possible, the authorities will strengthen the process of
implementation, including through technical assistance from the IMF, EU
Member States, and the European Commission, and put monitoring
mechanisms in place.

Building on the agreed comprehensive policy package, discussions on
the financing modalities for Greece’s economic program are expected to
take place over the next few weeks. Once this process is concluded and
following approval of the IMF’s Executive Board and the Eurogroup, the
next tranche will become available, most likely, in early July.

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baby_BLYTHE's picture

Government cannot collect revenue in deflation. So they will print, print and printl

Aductor's picture

No, they won't. It's not within its powers. Germany will never allow ECB to print the same way chairsatan has done. Expect the EUR/USD to print 2.00 - the amount of hopium produced by the troika is just stupendous.

Robot Traders Mom's picture

So the European Central Bank operates under strict monetary rules and transparancy?

Please feel free to expand...

Aductor's picture

No, of course not. But money printing is somewhat more complicated for the ECB.

Robot Traders Mom's picture

Just like putting hotels on Park Place is technically more complicated than putting hotels on St. James in Monopoly...

Aductor's picture

If you can't see the point trying to be made here, you really must have bought the story about European unity. The Euro is flawed by design, which is precisely why we are witnessing this farce and it is precisely the reason why good old Jean Claude has had a much harder time than the Bernank.

dracos_ghost's picture

I'm not seeing your point. Jean Claude may have better PR but the EFSF is definitely printing money and basically ramming it down member states throats. They need to reguage the elitists bank accounts by forcing more debt -- hence print more money.

If anything, the EU being flawed by design with even more room to print than the Bernank.

Robot Traders Mom's picture

Bingo. Thanks for doing my job without the sarcasm...+1

Aductor's picture

The question was not whether the ECB prints money, but whether it would be just to "print, print, print". I don't think the ECB with some 20+ sovereigns/fiscal policies is quite in the same spot as the Bernank. JCT may want to print, but the political landscape is quite different compared to US.

Ahmeexnal's picture

Meanwhile, in a parallel universe, Belarusia is being sucked into a black hole, while the rest of the world plays ostrich head in the ground pretending they don't see the incoming tsunami emanating from the erstwhile soviet province.

"As of 1 June inflation in Belarus is estimated at 20.2%."

With prices soaring 20% in just 2 days, the Belarusian multi Ph.D. economists should take a cue from the CME and hike margin rates for food, gas, and well...everything under the belarusian sun...because those price increases are a clear sign of a bubble.

And when the CHF hits 1.20USD in a few minutes/hours, another house of cards comes down.

camaro68ss's picture

A bunch of pissed of greeks not getting there hand-outs anymore... this is not going to end well

dwdollar's picture

And a bunch of arrogant bankers trying to suck the blood of a dried up corpse.   Definitely not going to end well.

Bob's picture

God, I hope it doesn't "end well."  I hope that our fat, lazy Greek brothers throw down like a drunken extended family in a trailer park holiday celebration when the COPS film crew shows up.  Banksters should be understood as mankind's common enemy, imo.  The Greeks are at the cutting edge. 

View the Greeks as badly as you like as a people, but at worst what we've got is a bunch of bullshitters telling the banksters that they best not try bullshitting bullshitters.

Said banksters have no trouble grinding down better people, anywhere you might look.  No trouble at all.  They even have armies of useful idiots out there evangelizing for fiscal responsibility/austerity.  Talk to the hand. 

Anschluss was a perfect choice of words for this situation.

We maybe probably gotta tax the financiers into something more nearly resembling their proper place.  Before it's too late. 

If we're not gonna put 'em behind bars or on lamposts where they belong.

tmosley's picture

Here's hoping they return to their roots:

Hopefully the emissary is a banker.

glenlloyd's picture

They gave up their printing press when they joined the club.

Zedge Hero's picture

World Revolution anyone?  Down with the Global Bank Cartel.­dgehero

chet's picture

I think this ends with Greece out of the Euro.  Just a feeling.

Vuvuzela's picture

Can someone explain the financial system in Europe ?

All nations states have to borrow though ECB and no nation state can print ?TY

FunkyMonkeyBoy's picture

It's all greek to me.

Silver Dreamer's picture

You might as well be speaking Chinese.  We all will or Russian by the end of this.  ;-)

Korrath's picture

I think China has far more problems beneath the surface then most people would believe; one of the benefits of having an authoritarian centrally planed government is that ability to hide most of the toxic crap building up in your system. may have point on that Russian thing.  Time will tell.

Things that go bump's picture

They're so sly.  All this time they have been quietly building up their arsenal, never opposing us directly unless our proxies encroach on their backyard, and allowing us to over-extend ourselves.  

A Man without Qualities's picture

Basically, they've not managed to reduce spending, reduce the deficit or increase tax revenue, but they've promised to try really hard in the future, whenever that comes.

The markets are going to take great cheer from these new promises from the Greeks, and forget the jobs number in order to close green...

carbonmutant's picture

Definition of Loan Shark on Investopedia - A person or entity that charges borrowers interest above an established legal rate.

Abitdodgie's picture

I hope they take the bailout , or it will be bad business for us ,because whilst the world gets in debt its easy money

jus_lite_reading's picture


Ray1968's picture

Only until the return of the Guillotine.

DoChenRollingBearing's picture

Bullish.  Am I the first to get that out?

More seriously, Greece has been Act One in a very long and very bad play.  Coming to a theatre near you.

If you do not have gold, you should go buy some ASAP.

Shell Game's picture

Agree, risk is rising for retail to find, 'Gold sold out, restock date unknown', at their local dealer.  Shock and aweful time is nearing..

AldoHux_IV's picture

Much like here in the US, the unholy union of policymakers and bankers will only rape and pillage the peasantry-- spending doesn't matter when it comes to billions of bailouts that have only made the financial system more unstable and deviate further from its original purpose of utility, trillions in stimulus that have not moved the economic needle (in real terms), but it now matters when it comes to social benefits for those who couldn't benefit from the ponzi that is the world economy what a joke.

Nothing like manipulative MSM, police batons, and pepper grenades to help implement rapacious initiatives.

duo's picture

Could you imagine what America would be like if foreigners owned our utilities back in the early 1900s?  Only the rich parts of certain cities would have running water and electricity today.  Rural farms, forget it, the investors need their money back.

The toll both economy.  Owned by bansters for banksters.

Milestones's picture

Good analogy!!  I like it.     Milestones

Milestones's picture

An add on the advise to Greece:

1) Take the $$ never mind the terms!

2) Up from 1--2Bn for ground to air missles

3) Up from 3 --5Bn for some good tanks from Russia

4) new-1Bn for RPG's (rocket propelled gernades)

5) 1 Very stealth bomber equipped with--well ya know!

6) Wine, women and song and lots of it

Fuck you Europe      Milestones

duo's picture

Could you imagine what America would be like if foreigners owned our utilities back in the early 1900s?  Only the rich parts of certain cities would have running water and electricity today.  Rural farms, forget it, the investors need their money back.

The toll both economy.  Owned by bansters for banksters.

buzzsaw99's picture

OT - It looks like A.G. Holder finally found a safe target to go after. John Edwards, whatever. Could he be any more irrelevant?

traderjoe's picture

They'll let Goldman lie to Congress, but not baseball players. It's ok to steal our money in plain sight, but don't mess with our bread and circus. 

Joe Davola's picture

He's hot on the case of the BCS - look out Tostitos!

nantucket's picture

funniest avatar and screen name EVER!  almost spit out my diet pepsi laughing at that one.

Thisson's picture

You're not the only one with an appreciation for the Seinfeld reference.

Rodent Freikorps's picture

Why not just kill them all, and repopulate the country with less useless humans?

There are only 10 million of the lazy bastards. That would only be half a Stalin in mass death terms.

Herman Strandschnecke's picture

What incentive to work and progress if you lose your democracy and national assets to bankers and the EU. That is why the EU will fail because our pride and national heritage is being taken away bit by bit.

Rodent Freikorps's picture

Sell it to the morons. These whiny, lazy bastards lived beyond their means, and now want to protest when the bill comes due.

Pay the bill you ran up.

Herman Strandschnecke's picture

Maybe so but they are thinking about their grandchildren. And their sovereign homeland. Don't let the bankers and the EU elite take your country.

DeadFinks's picture

Why weren't they thinking when the sold their grandchildren and homeland to the bankers and EU elite?

Herman Strandschnecke's picture

Yeah, it's a mystery ain't it? Same goes for USSR, China, Germany 1936~45, Ireland, UK, etc.

Herman Beach-Screw