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Chart Of The Day: The Greek Bailouts In Context... Or To Debt Reduction Via Debt Increase

Tyler Durden's picture




 

The simple Bloomberg chart below summarizes the running insanity that is the ongoing Greek bailout. To date, the existing bailouts - already completely wasted - amount to well over 100% of Greek GDP.

Keep in mind this is a simplistic, superficial read of the components involved in the three Greek bailouts to date. We show this to present the context for the Fourth Grek bailout which was a failure last night as virtually everyone knows that Greece, in its current iteration, is finished, and that with each passing day the economy collapses ever tighter into a singularity of its own, as nobody works, everyone is on strike, no taxes are collected, yet more government spending is curtailed, and the circle keeps on turning.

All of this is also quite well known to our regular readers. From April:

Two months ago many scoffed at us when we calculated that based on preliminary information, "The Cost Of The Combined Greek Bailout Just Rose To €320 Billion In Secured Debt, Or 136% Of Greek GDP." We clarified as follows: "Some of our German readers may be laboring under the impression that following the €110 billion first Greek bailout agreed upon and executed in May 2010, the second Greek bailout would cost a "mere" €130 billion. Alas we have news for you - as of this morning, the formal cost of rescuing Greece for the adjusted adjusted adjusted second time has just risen to €145 billion, €175 billion, a whopping €210 billion, bringing the total explicit cost of all Greek bailout funds to date (and many more in store) to €320 billion. Which incidentally is a little more than Greek GDP (which however is declining rapidly) at 310 billion, only in dollars. So as of today, merely the ratio of the Greek DIP loan (Debtor In Possession, because Greece is after all broke) has reached a whopping ratio of 136% Debt to GDP. This excludes any standing debt which is for all intents and purposes worthless. This is secured debt, which means that if every dollar in assets generating one dollar in GDP were to be liquidated and Greece sold off entirely in part or whole to Goldman Sachs et al, there would still be a 36% shortfall to the Troika, EFSF, ECB and whoever else funds the DIP loan (i.e., European and US taxpayers)! Another way of putting this disturbing fact is that global bankers now have a priming lien on 136% of Greek GDP - the entire country and then some now officially belongs to the world banking syndicate." Well, as it turns out, we were optimistic (which incidentally is always the case when we try to account for government stupidity and lies). To wit:

  • BARROSO SAYS TOTAL GREEK AID EQUAL TO 177% OF GREEK GDP - BLOOMBERG

This is SECURED debt, or debt which foreigners have funded with a lien on all Greek assets. Including gold! Translated, the Greek Debtor in Possession loan has a 177% Loan to Value.

 

Recall that according to the IMF Greek Debt/GDP will somehow be 120% in 2020. This means that 57% of the incremental debt will somehow have to be paid down. Or, as is 100% more likely, liquidated, with even more super-senior DIP debt. In other words, the Troika itself admitted that the Troika itself will be haircut before all is said and done.

And yet another aspect of the ongoing Greek insanity. As per Bloomberg:

European governments tore open the hole last week, by giving Greece two extra years to cut its budget deficit. The required extra financing provoked a clash with the IMF, since it would add to Greece’s debt load instead of reducing it.

Or, as we predicted the day the first Greek bailout was announced in May 2010, "Greece Bailed Out To Get In Even More Debt."

The absolute idiocy continues.

In summary: to debt reduction, via debt increase comrades! Forward!

 

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Wed, 11/21/2012 - 09:18 | 3001576 GetZeeGold
GetZeeGold's picture

 

 

So it's time for your allowance again? How time flies.

 

You do realize when you turn 18 we expect you to get your own place.

Wed, 11/21/2012 - 09:28 | 3001598 TWSceptic
TWSceptic's picture

The parents will be dead before that happens.

Wed, 11/21/2012 - 09:35 | 3001611 negative rates
negative rates's picture

Nothin like havin kids, just to put a load on them. It will even out in the end.

Wed, 11/21/2012 - 09:38 | 3001617 GetZeeGold
GetZeeGold's picture

 

 

Welcome to the world Johnny....here's your bill.

 

Don't be pissed at me....I didn't get a damn dime of that money.

Wed, 11/21/2012 - 14:56 | 3002821 AldousHuxley
AldousHuxley's picture

they just need to come up with a car that runs on olive oil.

 

Wed, 11/21/2012 - 10:00 | 3001676 mccoyspace
mccoyspace's picture

OK, you can stay until you are 21, but then that is really it. We're starting to get disappointed in you.

Thu, 11/22/2012 - 11:27 | 3004482 Bag Of Meat
Bag Of Meat's picture

What is this BS article again? It's like they test us to see if we just swallow whatever crap they post.
Let's begin with: "each passing day the economy collapses ever tighter into a singularity of its own, as nobody works, everyone is on strike, no taxes are collected, yet more government spending is curtailed, and the circle keeps on turning."
Oh that is the reason! The filthy non working,EU-money robbing greeks did it again! Thank god we have all those Elites and their Media to save us from them and their stereotypes! .......

 Second turd: "Another way of putting this disturbing fact is that global bankers now have a priming lien on 136% of Greek GDP - the entire country and then some now officially belongs to the world banking syndicate."

Well this is new! we learn all kinds of new stuff here in zerohedge. Today we learned that GDP is actually the worth estimate of A WHOLE COUNTRY. Right? Forget the broken window paradigm. Forget the fact that GDP IS ANNUAL. This doesnt mean that the debt is 1,36 years of greek economy work! No! It means they gotta sell off the whole Greek territory and some rights on the potential finding of the lost atlantis for the bankers to be happy!
Congratz for another great piece of ............. 

Wed, 11/21/2012 - 09:16 | 3001577 LongSoupLine
LongSoupLine's picture

Covering a lie to ensure the wealth of a few is expensive business.

Wed, 11/21/2012 - 09:18 | 3001578 overmedicatedun...
overmedicatedundersexed's picture

the banks own the greek debt, does anyone see a solution here?

Wed, 11/21/2012 - 09:20 | 3001586 buzzsaw99
buzzsaw99's picture

Just give the money directly to the banks like they do in the usa? [/sarc.]

Wed, 11/21/2012 - 09:24 | 3001592 GetZeeGold
GetZeeGold's picture

 

 

No way in hell those guys get down on their knees to Nancy Pelosi.....they have their standards.

Wed, 11/21/2012 - 09:19 | 3001582 disabledvet
disabledvet's picture

"reductio ad absurdium." spot on...but it was never a Greek bailout to begin with, yes, yes? "The goal has always been and still is to bailout out the German creditors." So the question we must ask (since we need to peer beyond the rhetoric so that we maintain OUR integrity!) is "how is the German bank bailout going?" Seems to me with the annihilation of the euro, the forced migrations of millions on the Continent, the still outrageously high prices for fuel over there, etc...etc..."not very well." Keep it Simple Stupid...we know the simple truth of the matter over there...let us move beyond that now and ask "how's it going?" Perhaps we can learn something to apply to our ability to move the US economy forward in a healthy way over here in the USA as a consequence. At the very least it should give us a heads up on potential "price spikes" since indeed "this response to the USA's debt crisis is not different from any other in the past" is it not?

Wed, 11/21/2012 - 09:23 | 3001588 goldnguns
goldnguns's picture

We should just make Greece the 51st state.  Heck, half of Greece has relatives in the US anyhow.  Then we taxpayers can absorb that piddling ass debt load (what?  300 billion?  we blow that in 2-3 months), Greece can thumb their nose at the IMF, we get a big discount on ouzo, they all get Obamaphones, and life is again good.

Wed, 11/21/2012 - 10:26 | 3001748 Kobe Beef
Kobe Beef's picture

I'm surprised Obama hasn't thought of this yet. They'd vote democrat & we'd have another few million socialists on the welfare rolls.

Wed, 11/21/2012 - 09:24 | 3001591 Smegley Wanxalot
Smegley Wanxalot's picture

Pacman chart

Wed, 11/21/2012 - 09:25 | 3001594 evolutionx
evolutionx's picture

 

Euro Collapse Explained in 3 Minutes

Reflections on Europes financial woes. Special subject: the economies of the European Community. Which debt is owed by whom? Who will pay the bill?

 

http://www.mmnews.de/index.php/english-news/7683-euro-collapse-explained-in-3-minutes

Wed, 11/21/2012 - 11:15 | 3001907 fockewulf190
fockewulf190's picture

Good video!

Wed, 11/21/2012 - 09:29 | 3001599 LongSoupLine
LongSoupLine's picture

annnnd it's gone...

 

ES just went green boys.  Welcome to the new normal of corrupt algo fullretard.

Wed, 11/21/2012 - 09:32 | 3001605 Sudden Debt
Sudden Debt's picture

manageable...

 

Look at Belgium! (dutch article)

http://www.tijd.be/nieuws/ondernemingen_financien/Omvallen_Dexia_heeft_zeer_ernstige_gevolgen.9270947-3095.art 

Dexia ready to fall!!

1 TRILLION IN DEBT!

GDP Belgium => 315 BILLION

DEBT => FFFFUUUUUBBBBBAAAARRRRRR!!!!

DON'T WE JUST LOVE DERIVATIVES?!

 

Wed, 11/21/2012 - 09:37 | 3001613 overmedicatedun...
overmedicatedundersexed's picture

look up the banks the FED bailed out in 08/09..dexia was a favorite pet..same now.

Wed, 11/21/2012 - 09:39 | 3001620 BurningFuld
BurningFuld's picture

Why is everyone picking on Dexia? Or I guess more to the point, why is everyone picking on Belgium, surely this can be swept under a rug somewhere or the data fudged a little better. Freekin' amateurs.

Wed, 11/21/2012 - 11:15 | 3001908 Sudden Debt
Sudden Debt's picture

I don't understand either...

we supplied the entire Israeli army with new weapons from FN....

and this is the thanks we get... go fish...

 

Wed, 11/21/2012 - 09:37 | 3001614 timbo_em
timbo_em's picture

If someone attached some mean teeth to that darker blue area of that left circle, it would look funnier and it would illustrate the malaise in a very obvious manner.

Wed, 11/21/2012 - 09:40 | 3001621 Shizzmoney
Shizzmoney's picture

Hey look, it's Pac Man!

Wed, 11/21/2012 - 09:41 | 3001625 Broccoli
Broccoli's picture

Modern political and economic thinking: The problem of malinvestment can be fixed with more malinvestment.

Do they still teach "the first loss is your best loss" anywhere?

Wed, 11/21/2012 - 09:59 | 3001670 GMadScientist
GMadScientist's picture

I'm afraid that was repealed in favor of corporate socialism.

 

Wed, 11/21/2012 - 10:04 | 3001684 mccoyspace
mccoyspace's picture

You could say that it was good money after bad, but it hasn't been good money for a while now.

Wed, 11/21/2012 - 09:41 | 3001626 NEOSERF
NEOSERF's picture

And given that Spain's economy is as bad and 5x the size, I can't wait to see how the Euro group absorbs $1.5T in aid especially with France unable to help.  Gives new meaning to slow motion train wreck as we all simply wait for the Lehman moment where the Fed and UK has to step in to stop the complete collapse of Europe...again

Wed, 11/21/2012 - 09:42 | 3001629 BullionTweet
BullionTweet's picture

Front row seats as Greece sinks into the Black Hole of oblivion and drags everyone else in with it. We're all being draged in but at different placements on the drain vortex. No way out for those poor bastards. The reaper commeth soon.

Anyone want to buy a Greek Island cheap? Learn German.

Wed, 11/21/2012 - 09:49 | 3001642 OneTinSoldier66
OneTinSoldier66's picture

Long Financial Engineering Degrees.

Wed, 11/21/2012 - 09:52 | 3001650 WaEver
WaEver's picture

Madoff would be proud looking at the prerformance of his pupils

Wed, 11/21/2012 - 10:01 | 3001679 GMadScientist
GMadScientist's picture

Especially after they put it in.

o.O

Wed, 11/21/2012 - 09:55 | 3001660 jmcadg
jmcadg's picture

So that's about €2900 for every man, woman and child in Greece.

Let's see now, we have people dumpster diving and we have Venizelos looking a svelt as ever.

Just remind us where the money is going?

Wed, 11/21/2012 - 10:29 | 3001761 Kobe Beef
Kobe Beef's picture

The International Banking Cartel. In a few fell swoops they managed to steal more than 100% of Greek GDP. Now that's some serious racketeering.

Wed, 11/21/2012 - 10:26 | 3001749 shovelhead
shovelhead's picture

Goats over there...Olives over here.

And... the women who don't need a shave,  thru that door.

"Jah...jah. Gut ze debt is secured... Dumkopfs."

Wed, 11/21/2012 - 10:38 | 3001791 Vegetius
Vegetius's picture

Dexia the bank that keeps on giving!

 

 

Wed, 11/21/2012 - 12:26 | 3002186 dexter_morgan
dexter_morgan's picture

si se puede!

Thu, 11/22/2012 - 15:39 | 3005054 dicktator
dicktator's picture

Quick Nov. summary:

Obama: Four more years
Greece: Two more years
Adoboli: Seven more years

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