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Greece Flails About, Troika Inspectors Paint “Awful Picture,” Merkel Draws A Line, German Industry & Voters Back Her
Wolf Richter www.testosteronepit.com
The new Greek finance minister, Yannis Stournaras, until recently a professor of economics at the University of Athens, hasn’t learned yet the art of extortion that is required to accomplish anything at all during negotiations with the Eurozone. And so, when he went to the meeting of Eurozone finance ministers earlier this week at the Eurogroup—which serves as political control over the common currency—he accomplished absolutely nothing. He wasn’t even able, unlike his predecessors, to get himself into the media with some wild threat about a “disorderly default” or destroying the entire Eurozone if he didn’t get what he wanted.
He had two big jobs to do: one, promote Greece’s efforts to renegotiate (“water down” is the technical term) the structural reforms that the prior government had agreed to in writing by signing the bailout memorandum; and two, push for a two-year delay of these watered-down conditions. At the same time, he’d have to make sure Greece would continue to receive the flow of bailout billions from taxpayers elsewhere.
But roundly ignored at the Eurogroup meeting, he returned empty handed to Greece. A fiasco for him. In a meeting with leaders of the three-party coalition government—the conservative New Democracy, the socialist PASOK, and the small Democratic Left— Evangelos Venizelos, PASOK leader, former finance minister, and extortionist par excellence, was apparently furious with him and hollowed out his power. The infighting begins.
Time is running out for Greece. Completely dependent on bailout payments to keep its finances from collapsing, Greece is losing ever more support where it counts the most: in Germany. According to the latest poll, 61% of Germans reject giving Greece and other bailed out countries more time to solve their problems. They’ve had enough of the broken promises. They’ve become so bitter about the whole process that, according to another poll, 58% of Germans want their Deutsche Mark back, up from 39% in 2010.
And what had to happen, finally happened: for the first time, an important component of German industry, the German Engineering Federation (VDMA) demanded that Greece leave the Eurozone “if it cannot, or does not want to, stick to its agreements.” German industry, which has benefitted from the euro and what amounted to a bailout of its customers in other countries, had been a staunch supporter of the euro, the bailouts, and keeping the Eurozone intact. But bailout funds, such as the European Stability Mechanism (ESM), should not be used to fund structural deficits, the organization said. And so it stepped up its support for Chancellor Angela Merkel and encouraged her to hold the line on Greece.
Merkel came out swinging. She would not tolerate that the bailout memorandum that contained the agreed-upon structural reforms would be watered down though she might be willing to delay implementation by “a few weeks”—not the two years the Greek government is seeking. Her spokesman Steffen Seibert was even firmer: “Neither the content nor the time frame of the memorandum is up for debate,” he said. Greece must “make great exertions.”
But that’s precisely what has not been happening. Inspectors of the “Troika”—the EU Commission, the European Central Bank, and the International Monetary Fund, the entities that have agreed to bail out Greece under certain “conditions”—were back in Athens earlier in July to review Greece’s books, check on progress of the agreed-upon structural reforms, and meet with government officials, all in order to determine if these certain “conditions” have been met. The inspectors already expected the worst, after a three-month hiatus while Greece was embroiled in political turmoil and two elections, an interregnum during which nothing was implemented.
Apparently, it was even worse. Elements of their preliminary and still unpublished report due by the end of July seeped out: it painted an “awful picture”; of the 300 specific measures to be implemented by now, 210 were completely ignored and left by the wayside. This is the report that the Troika will use in deciding whether or not to send the next bailout tranche to Greece. And without this money, Greece will have to default and most likely exit the Eurozone.
Germany itself is embroiled in disagreement over the endless bailouts, and their two crucial future mechanisms: the ESM bailout fund and the fiscal union pact. Cobbled together after hectic summits with dog and pony shows designed to soothe edgy markets, they’re now in the hands of the German Constitutional Court—and these are the options. Read.... Will the Euro Survive This Year?
Double-checking as euro miasma leaks into the rest of the world.... What Is Copper Telling Us about the Global Economy?
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Zero Hedge has not been around five years, Ace! It was founded in January 2009. I found it in January 2009 after being layed off from a job and having some free time on my hands, lurked for awhile before joining in early August 2009. The activity here in Jan. 2009 was pretty low, but man did it ever ramp up, just like the market keeps doing.
So we'll call it 3.5 years for now.
http://en.wikipedia.org/wiki/Zero_Hedge
We can argue whether wikipedia is a good source of information, so, see the archives. There is nothing earlier than January 11 2009.
http://www.zerohedge.com/archive
Study Dan Ivanjicki...
Ivandjiiski. Can't even spell it correctly huh?
http://www.nypost.com/p/news/business/item_hn6OGbJ7XLE5BXvLDLA2oK
That's fine. But still, there are no posts earlier than January 11 2009 on this site. The article was written in September 2009, and he was banned from trading in September 2008. Give him some time to get this up-and-running, Wham! it's January 2009. ;-)
The above article also states, "since its launch in January". The article having been written in September 09. OOPS!
And yeah, I know the site transitioned to a new style in 2010 or 11, can't recall which.
BTW: I liked the old style better. ;-0
Your posting tooo much off subject. Stay focused on the article, these Tyler's have been blogging for many years-as have our group-trust us- the Euro/usd is going back up close to $1.30, trade accordingly-that is IF you actually trade.
I don't, and won't. ;-)
you do, and can't. ;-)
You're missing "the Seeking Alpha days" where i got my start...before Tylers' Durden first appeared. He was much scarier then...and SA in those days was a true wild west show as the market and the economy was in total free fall. The Government has mind-martianed so many of us we simply can't speak freely anymore. Having said that "the economy has recovered" as well so "perhaps we can rationalize the fear better such that we can confront it more abley."
http://www.youtube.com/watch?v=qMUxvDBFQYs
You are right. Seeking Alpha now is poor compared to what it was in 08-09. Nothing but a bunch of ETF shills and long-only investment manager types peddling wares on Seeking Alpha now. What a shame.
Along with its step-brother Roubini Global Economics, I'm afraid to say ...
who can argue this ..... slowly, even semi-sheeple like me, wake up ...... so you then have an increasingly more narrow 'base' bidi/ask-ing ... which becomes potentially more and more unstable.
Again, go back to Mickey Mouse of Fantasia fame as Sorcerer's Apprentice. But who will be the 'wise' Apprentice? I would not count on capo Soros ...
As Nigel Farage says in this RT interview, "Angela Merkel is no fool, and is a very astute politician".
I hope she stands her ground and gets re-elected. We can argue whether being an astute politician is a good thing (probably not, see below), but she seems to be the sanest one over there.
Remember the old JFK quote, "Every mother wants their son to grow up to be president, but they do not want them to become politicians in the process".
Things that make you go hmmm! ;-)
http://www.youtube.com/watch?v=jNgDReKg2Ss
Angela Merkel is an ex-communist apparatchik turned bankster-stooge. A piece of Eurotrash.
Well then, this looks like it could be a very interesting part of the soap opera.
but the germans taking back the deutsche mark and the finns their markka, etc. is truly the best way out of this morass. let the weakest links keep the euro and inflate their debts away.
only debt restructuring or repudiation will lead to an organic recovery. austerity isn't going to do it.
bankruptcy must be allowed to happen. all prior deflationary depressions were characterized by great rolling waves of it. chaining debtors to their debts will lead to a generation of poverty and probably more wars.
Friday:
http://www.youtube.com/watch?v=AFbHr-nKkTc
Hey Tylers, lose that fag Obama-Biden re-election campaign top of the page banner header. It is very unbecoming and ignorant propaganda... The guy is/has ruined our country and seeing his crappy banner ads paid for by stolen money from the taxpayers is just too much.