• StalingradandPoorski
    03/04/2015 - 16:46
    What people and central bankers do not understand, is that you can't devalue your way to prosperity. Absolutely nothing has changed since the last crisis. The same too big too fail banks have only...

Bank Run

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As Greece Scrambles To End Its Bank Run, JPM Throws A Wrench: Says Deposit Outflows Continued After "Deal"





Just when Greece thought it had bought itself some breathing room in its desperate attempt to rebuild confidence in its financial system, here comes JPM and effectively calls Yanis Varoufakis a liar, suggesting that Greek deposit outflows have continued at a brisk pace despite the bailout extension "deal."

 
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German Parliament Approves Greek Bailout After Schauble Makes It Clear Germany Remains In Charge





If Bild's expectation that its "Nein to more Greek bailout" campaign would lead to a near unanimous vote in the Bundestag for a Greek bailout, then it achieved its goal when a massive majority of lawmakers, some 542 of them, voted in favor of giving Greece the prenegotiated 4 month extension to its current bailout. Still, as many pointed out, of the 32 votes against, a record margin for a euro vote, or 29, came from Merkel's own CDU/CSU block. This was up from 13 voting against the second Greek bailout. Indeed, as the Guardian's Ian Traynor summarizes "Merkel's biggest majority on Greece but also biggest rebellion in her ranks while linke votes for Syriza pals, also a 1st."

 
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Greece Suffers Biggest Bank Run In History: January Deposits Plunge To 2005 Levels





Moments ago the Bank of Greece presented its latest, January, deposit data. And it's a doozy: following a record €12.2 billion monthly outflow, greater in absolute and relative terms than anything experienced during any of the previous Greek crises and bailouts, the total amount of Greek corporate and household deposits has now tumbled to just €148 billion. This number is in line with some of the more pessimistic expectations, and brings the total cash holdings at Greek banks to the lowest level since August 2005.

 
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Troika "Happy" With Revised List Of Greek Reform Promises: Full Varoufakis Letter





What happened over the past week to the Syriza "mandate" is that the new government's list of unfulfillable promises to the Greek people has been replaced with a new list of unfulfillable promises to the Troika.

Update: EU COMMISSION SAYS GREEK LIST `SUFFICIENTLY COMPREHENSIVE'

 
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ECB To Grant Greece Additional €3 Billion In Emergency Liquidity, €68.3 Billion Total





Those wondering if Draghi would be so bold as to precipitate a Greek bank run and funding crisis by yanking the country's Emergency Liquidity Assistance program, which as of two weeks ago was boosted to €65 billion, now have an answer. According to Dow Jones, the ECB just boosted the Greek cash allottment to €68.3 billion, an increase of €3.3 billion:

  • ECB SAID TO OK CONT. EMERGENCY LIQUIDITY FOR GREEK BANKS:
  • ECB SAID TO OK ELA FOR GREEK BANKS OF EUR68.3B FOR 2 WKS: WSJ

Which means that the cat and mouse game between Greece and Europe will continue for at least one more week, because that's when, according to Kathimerini's Greek sources, the nation runs out of state cash which will have the same impact on the Greek negotiating leverage as a full-blown bank run.

 
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"In The End Capital Controls Will Probably Have To Be Imposed" - Eurogroup Official





One thing is becoming clear: Greece will almost certainly not last until the proverbial D-Day on February 28 before it either i) runs out of money, ii) is forced to sign a "bailout extension" deal with the Eurogroup thus crushing its credibility with the people, or iii) exits the Eurozone. Needless to say, two of the three above options are very unpleasant for Greek savers, assuming any are left. And it is those savers that the Eurozone is directly targeting when it does everything in its power to provoke a bank run with statement such as these: "The situation of the banks is getting more and more difficult every day," said a European official. "In the end, in order to safeguard the banking system, capital controls will probably have to be imposed."

 
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As Bank Run Accelerates, Greek Depositors Pray To Saint Mario





Here comes the strawman we've all been waiting for: "Greek deposit withdrawals picked up after talks between Greece and its euro-area creditors on extending its bailout ended in acrimony in Brussels Monday night, said the people, who asked not to be identified because the information is private. The ECB will likely provide ELA to Greek banks as long as there is a chance of an agreement between Greece and its creditors to extend the current bailout, economists at Barclays Plc including Antonio Garcia Pascual and Thomas Harjes wrote in a client note after the meeting ended Monday. If Greek authorities don’t take up euro area finance ministers’ offer this week, ELA funds to Greek banks would likely be shut down, they wrote."

 
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Dijsselbloem Says "Very Pessimistic" About A Deal On Monday As Greek Deposit Flight Hits €1 Billion Per Day





The game of words continues, and following reports both yesterday and today that first Germany, and then Greece would compromise, and in the case of the latter even do "whatever it can" to reach a deal, it is time for Europe's bad cop, Eurogroup President Jeroen Dijsselbloem, to pour cold water on the party and crush Greek enthusiasm even more when he said moments ago that he was "very pessimistic" about the chances that a meeting he will chair on Monday of euro zone finance ministers would reach a final debt deal with Greece.  Cited by Reuters, he said that Greek voters' expectations of their new government were "a mile high", Dutch finance minister Dijsselbloem was asked whether a plan to resolve Athens' financial problems would be achieved on Monday. He replied, in a remark aired on Dutch television: "I’m really still very pessimistic about that now."

 
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Greece Willing To Do "Whatever It Can" To Reach Deal After Greek Liquidity Situation Deteriorates Rapidly





"Greece will make every effort to reach an agreement with its euro zone partners at Monday's meeting of euro zone finance ministers on how to transition to a new support program, its government spokesman said on Friday. "We will do whatever we can so that a deal is found on Monday," Gabriel Sakellaridis told Skai TV. "If we don't have an agreement on Monday, we believe that there is always time so that there won't be a problem." The reason for this rapid about face? "Senior bank officials have told Kathimerini that almost all the liquidity available to Greece (59.5 billion euros) has been absorbed and that banks’ total dependence on the Eurosystem amounts to 90 billion. The rapid deterioration in liquidity conditions has been attributed to the uncertainty that arose when the snap general elections were called as well as the new government’s inability to reach a swift agreement with the country’s creditors." As usual: money threatening to walk, walks.

 
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Stealth Greek Bank Run Continues: ECB Hikes Emergency Lending To EUR 65 Billion





It would appear the un-sourced rumors of Greek banks having used up their Emergency line of credit with the ECB are true. Following a hastily put together conference calls this morning:

  • *ECB RAISES GREECE ELA ALLOWANCE TO EU65BN: FAZ

Up from the previous EUR59.5 Billion. It appears the stealth bank run in Greece is showing no signs of slowing.

 
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How Dan Loeb Thinks The Greek Crisis Plays Out





As reported yesterday in his Q4 letter to investors, Third Point's Dan Loeb took down his net leverage going into 2015 for one simple reason: a "haunted house market" as he described it, where "a new scary event lurks around each corner", and no event is scarier than a worst-case outcome to the Greek situation. So how does Loeb see the latest Greek crisis ending? Read on for this thoughts.

 
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If Greece Exits, Here Is What Happens (Redux)





Now that the possibility of a Greek exit from the euro is back to being topic #1 of discussion, just as it was back in the summer of 2012 and the fall of 2011, and investors are propagandized by groundless speculation posited by journalists who have never used excel in their lives and are merely paid mouthpieces of bigger bank interests, it is time to rewind to a step by step analysis of precisely what will happen in the moments before Greece announces the EMU exit, how the transition from pre- to post- occurs, and the aftermath of what said transition would entail, courtesy of one of the smarter minds out there at the time (before his transition to a more status quo supportive tone), Citi's Willem Buiter, who pontificated precisely on this topic previously. Three words: "not unequivocally good."

 
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Varoufakis Warns "Cloud Of Fear Over Europe Becoming Worse Than Former Soviet Union"





The cracks in the foundation, walls, and ceiling of the European Union are beginning to widen. During an interview with Italian State TV RAI3, Greek Finance Minister Yanis Varoufakis hinted at Greece's "New Deal for Europe" strategy (to be financed by the EIB) but it was the glimpse behind the curtain of EU solidarity that was most shocking as he explained, "Greeks don't have a monopoly on the truth. What we can do, for the rest of Europe, and for Italy in particular, is to open a small door to the truth," adding rather stunningly, that Italy "stands in solidarity with [Greece] but cannot tell the truth as they fear of possible consequences on behalf of Germany."

 
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