Greece Considering Confiscation Of Private Assets

Tyler Durden's picture




 

The last time we opined on the possibility of a Cyprus-style "bail-in" in Greece, which is essentially a legally-mandated confiscation of private sector assets held hostage by the local financial system, until such time as the balance sheet of said financial system is viable, we were joking. Well, not really joking.

But not even we thought that a banking sector "bail in", in which unsecured bank liabilities, which include bonds and of course deposits, are used as a matched source of extinguishment of non-performing bad debt "assets" could spread to the broader economy, and specifically to unencumbered private sector assets. Alas, this is precisely what Greece, which is desperately to delay the inevitable and announce it needs not only a third but fourth bailout, appears keen on doing.

As Kathimerini reports, the Greek Labor and Social Insurance Ministry is "seriously considering drastic measures in order to obtain the social security contributions owed by enterprises and to avoid having to slash pensions and benefits." What drastic measures? "The ministry is planning to force companies to pay up or face having their assets seized, so that the 14 billion euros of contributions due can be recouped."

After all, it's only "fair."

Kathimerini is kind enough to layout the clear-cut problems with this plan which will further crush any potential rebound in the Greek economy:

While this amount – equal to 8 percent of the country’s gross domestic product – may be easy to calculate on paper, it is virtually impossible to collect even if the state attempts to confiscate all the real estate properties of debtors and the debts of third parties to them.

 

The ministry has been forced to consider asset repossessions as a result of the very poor state of social security funds. The fiscal gap expected at the end of the year from social security will at best be equal to 1.06 billion euros. This also constitutes a bad start for next year, too, when the budget will also provide for a reduction in state subsidies to social security funds by 1.8 billion euros.

Aside from the obvious, namely that this "plan" will be merely the latest disaster to hit the long-suffering Greek economy, now caught in the worst depression in history, and where greedy and corrupt politicians will promptly "confiscate" whatever benefits there are to have been made from this confiscation plan (however instead of accusing corruption all blame will be once again fall on (f)austerity), the greater problem is that any entrepreneurial confidence that Greece just may be a sound place to do business, has just gone out of the window as nobody will know if they are safe from arbitrary persecution, and subject to a wholesale asset confiscation at any moment in time.

However, none of the above gives us more confidence that things in Greece are about to go from horrifying to nightmarish, than the following FT story: "John Paulson and a clutch of bullish US hedge funds are leading a charge into Greek banks, confident that Greece, long seen as the weakest economy of the eurozone periphery, is on the turn."

Right. A 360-degree turn.

The good news: at least the Greek government will have a lot of "greater fool" assets to pick and choose from when the confiscation hammer hits.

0
Your rating: None
 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Sun, 10/06/2013 - 16:04 | 4028158 TeamDepends
TeamDepends's picture

Kanellos*, attack!!!

*Greek riot dog

Sun, 10/06/2013 - 16:20 | 4028223 Millivanilli
Millivanilli's picture

War and rumors of war are here.  Prepare accordingly.

Sun, 10/06/2013 - 16:25 | 4028236 smlbizman
smlbizman's picture

so there are cyrstal balls that show the future.....

Sun, 10/06/2013 - 16:38 | 4028259 Millivanilli
Millivanilli's picture

Egypt, Iraq and Syria are in civil war.  The markets of Japan, Europe, and the US are propped up with funny money.  50 million Americans are on food stamps.   

 

War is here, where have you been?

Sun, 10/06/2013 - 16:43 | 4028267 DaddyO
DaddyO's picture

These activities of the foreign CB's are the blueprint of what is to come with any fiat currency put out by a CB.

Fiat only has the value they say it does!!!

So when they say it has less value, they inevitably need MOAR to compensate.

They got away with it in Cyprus, no banksters swinging from the yardarm, so they will enact confiscation on an even larger scale.

DaddyO

Sun, 10/06/2013 - 17:17 | 4028332 e_goldstein
e_goldstein's picture

Rumor has it, it's happening here already.

Most recent case:

http://ij.org/miforf

Sun, 10/06/2013 - 19:06 | 4028641 Things that go bump
Things that go bump's picture

And that is why I keep no money in the banking system, except for small amounts to pay the bills and why I no longer own a house. 

Sun, 10/06/2013 - 20:49 | 4028942 Croesus
Croesus's picture

@ E_goldstein: Everybody on here, should read that link! Good find! Thank you!

Mon, 10/07/2013 - 01:23 | 4029519 All Risk No Reward
All Risk No Reward's picture

All while the mega banks get a "free and clear' to launder up to $378 billion a pop...

How a big US bank laundered billions from Mexico's murderous drug gangs

 

http://www.theguardian.com/world/2011/apr/03/us-bank-mexico-drug-gangs

And guess what?  The Wachovia didn't return the $378 billion and there was no Al Capone like investigation that led to a tax evasion conviction.

BECAUSE THE CRIMINALS CONTROL THE BANKS AND THE TOP LEVELS OF GOVERNMENT!

Sun, 10/06/2013 - 16:44 | 4028268 James_Cole
James_Cole's picture

the greater problem is that any entrepreneurial confidence that Greece just may be a sound place to do business, has just gone out of the window as nobody will know if they are safe from arbitrary persecution

Heaven forbid folks lose faith in the entrepreneurial spirit of Greece!

is seriously considering drastic measures in order to obtain the social security contributions owed by enterprises 

And:

This also constitutes a bad start for next year, too, when the budget will also provide for a reduction in state subsidies to social security funds by 1.8 billion euros.

Sun, 10/06/2013 - 17:02 | 4028301 cossack55
cossack55's picture

You forgot Libya and Yemen, oh and Sudan and CAR.

Sun, 10/06/2013 - 17:13 | 4028333 TaperProof
TaperProof's picture

My balls are large and crystal, i'd prefer steel but i'll live with crystal

Sun, 10/06/2013 - 17:19 | 4028348 Freddie
Freddie's picture

What a criminal country backing the EUSSR and cheesepopes.   Arrest any political opponents then  steal what little wealth is left in the country. Sickening.

Sun, 10/06/2013 - 17:55 | 4028455 Boondocker
Boondocker's picture

Can wr just start imploding already?

Sun, 10/06/2013 - 15:56 | 4028159 VD
VD's picture

the greek way: ouch

Sun, 10/06/2013 - 17:15 | 4028337 TaperProof
TaperProof's picture

Greeks are voting you down.  I'm guessing the greek people are no different than the people here.  Some that understand whats going on and a bunch of ignorant zombies.

Sun, 10/06/2013 - 15:58 | 4028164 prains
prains's picture

Remind me again which unfunded liabilities we need to be worried about again, i can't remember them in the correct order

Sun, 10/06/2013 - 16:04 | 4028182 Harbanger
Harbanger's picture

Unfunded liabilites means socialism has run out of money.  Now they come after your private assets.

Sun, 10/06/2013 - 16:05 | 4028185 prains
prains's picture

so then the biggest socialist enterprise invented by pinko's masquerading as capitalists <the MIC> will go unfunded??

Sun, 10/06/2013 - 16:16 | 4028214 Harbanger
Harbanger's picture

Of course not.  They will fund it by printing until no one in the world wants US$.  The local sheep get fleeced and are forced to use their new FRN's.

Sun, 10/06/2013 - 16:07 | 4028188 scraping_by
scraping_by's picture

Enron wasn't socialism. It was the shining star of the new model of capitalism. Asset-light and information and all that...

Sun, 10/06/2013 - 16:14 | 4028204 prains
prains's picture

the beacon of mark to unicorn accounting and commodity manipulation >> capitalism.....that one??

Sun, 10/06/2013 - 16:26 | 4028235 TeamDepends
TeamDepends's picture

You want to see the books?  Oh, we'll show you the books....(accidentally trips down the stairs)

Sun, 10/06/2013 - 18:26 | 4028541 Anusocracy
Anusocracy's picture

For decades, the libertarians and anarchists have been calling Western Democratic Socialism slow-motion communism.

Luckily, the West has private property it can steal.

Sun, 10/06/2013 - 19:14 | 4028660 Things that go bump
Things that go bump's picture

You own no assets, are in fact chattel and the property you think you own is only rented to you until they want to give it to someone else. Wrap your head around that.

Sun, 10/06/2013 - 16:25 | 4028229 malikai
malikai's picture

At this point, pretty much everything is an unfunded liability.

Sun, 10/06/2013 - 15:56 | 4028166 Harbanger
Harbanger's picture

Is Greece considering this or is it the EU's idea?

Sun, 10/06/2013 - 16:03 | 4028180 ...out of space
...out of space's picture

everything is eu idea

Sun, 10/06/2013 - 16:18 | 4028221 asteroids
asteroids's picture

We are entering the end game now. Remember the banks get paid first. Especially the non-Greek banks. Theft of capital is one step short of revolution or civil war.

Sun, 10/06/2013 - 18:43 | 4028586 Its_the_economy...
Its_the_economy_stupid's picture

if by endgame. you mean 10-20 years before capital endgame, then yes, we are entering the endgame.

Sun, 10/06/2013 - 17:12 | 4028277 Ghordius
Ghordius's picture

the original article: "The (Greek) Labor and Social Insurance Ministry is seriously considering drastic measures in order to obtain the social security contributions owed by enterprises and to avoid having to slash pensions and benefits."

you have to know the country a bit to understand the issue. owed. As in "not paid"

Germany and other countries repeatedly offered Greece assistance in tax collection

this is one of the articles where I really don't understand the Tylers. they write "After all, it's only "fair.""

don't know about "fair". is it "ironic"? paying taxes is just "the law". now I do moan about taxes as any other small entrepreneur. but hearing about others not paying them does not make me appreciate "anti-statism" "irony"

perhaps there is an age & cultural gap I can't reach across, here? If you really like the idea of a state that is not able of collecting taxes, in the absence of any truly stateless territory (yet), Greece should actually draw anarcho-nihilists in droves. yet I don't read any pamphlets of this kind

Sun, 10/06/2013 - 18:10 | 4028496 Colonel Walter ...
Colonel Walter E Kurtz's picture

Was wondering the same thing.

Does that mean the money is owed and the businesses are just choosing not to pay the taxes or is that they have no cash/profit to actually pay the taxes? Either way, once a country reaches this point, I would think confiscation is not going to result in enough funds to last for very long. The well is running dry and any effort to maintain the status quo in an effort to pay overhead (i.e. pensions, government salaries, etc...) is going to result in death spiral. 

Good luck Greece. Good luck to us all.

 

 

Sun, 10/06/2013 - 17:18 | 4028346 Kirk2NCC1701
Kirk2NCC1701's picture

Part of the End-Game:  Greece -- the cradle of Western Civilization -- is the BETA-TEST SITE for all others.

"Grease up" and get ready, cause you're gonna get it the up the "Hershey Highway" from Ben.  'Ben Dover'.

Sun, 10/06/2013 - 15:56 | 4028167 Jaspergers
Jaspergers's picture

Will greek companies that are owed hundreds of millions by the government be able to confiscate public assets?

Sun, 10/06/2013 - 17:18 | 4028345 Ghordius
Ghordius's picture

excellent question. yet in my experience they are not the same companies. the big ones tend to be debtors and the small one creditors

Sun, 10/06/2013 - 15:58 | 4028168 Stoploss
Stoploss's picture

/.  .\

   0

Sun, 10/06/2013 - 16:02 | 4028175 Racer
Racer's picture

So to realise the value of all these confiscated assets, just who are they going to sell them to? Anyone in their right mind wouldn't touch them unless of course they are at extreme knockdown price. If that is the case I bet Goddam Suckers is given exclusive first choice to grab it and put in a clause that it cannot be seized again unless fully reimbursed plus interest and fees for their inconveniences

Sun, 10/06/2013 - 16:04 | 4028181 CPL
CPL's picture

The objects have no value if they can simply be taken by anyone.

Sun, 10/06/2013 - 16:19 | 4028217 lolmao500
lolmao500's picture

The state will seize them, sell them for cheap to Goldman Sachs... nothing will be solved, the state will need to seize more assets... etc... rinse and repeat till Goldman Sachs owns everything, even your wife.

Sun, 10/06/2013 - 18:59 | 4028631 Notarocketscientist
Notarocketscientist's picture

Who will purchase them using ZIRP money from Ben --- they will then load everything onto the back of Uhaul trucks and sell the stuff on the side of the road --- if they can't sell the confiscated stuff then they will dump it at the nearest landfill and then go back to Ben for a bail out.

Just like Black Rock is going to do when their massive portfolio of houses crashes.

Sun, 10/06/2013 - 16:01 | 4028178 lolmao500
lolmao500's picture

Well they do the same thing in the US. Don't pay your taxes? The IRS come in and take your shit.

Sun, 10/06/2013 - 16:22 | 4028225 Millivanilli
Millivanilli's picture

Yep.   Bank account, car, house, and anything they can track down.  I guess it isn't any wonder that all credit card transactions are now being monitored by the IRS.  

 

This is NOT how a FREE and BRAVE people live.  Period.

 

FUCK YOU OBAMA

CC NSA

Sun, 10/06/2013 - 17:24 | 4028364 Bobbyrib
Bobbyrib's picture

It started before Obama, but I still agree with the statement.

Mon, 10/07/2013 - 10:31 | 4030122 layman_please
layman_please's picture

well over here, in estonia, we just had new law enacted which will make every purchase above 1000eur run through our irs (i'm not sure about cash, probably we have to show id). this comes from the government who 'nationalised' our unemployment and healthcare reserves(yes we had reserves, can you imagine that?) which were substantial considering the size of the country. of course common citizen is the enemy to be monitored closely. fucking joke...

Sun, 10/06/2013 - 21:39 | 4029079 Promethus
Promethus's picture

lolmao, exactly right. Why is this news? The real news would  be if the Greek government actually did something to collect tax. Easier to cry for German reparations.

Sun, 10/06/2013 - 16:04 | 4028183 scraping_by
scraping_by's picture

Not quite the same thing as banks turning obligations into assets.

Much of the private property in many countries are public assets somehow converted to the control of the connected. Friendships, both personal and bought, seem to be currency in store. Much of the rest is just exercises in subsidy sucking.

I weep less that I should.

Sun, 10/06/2013 - 16:11 | 4028191 q99x2
q99x2's picture

Return the Elgin marbles to the Greek people.

Don't let the Chinese purchase Zeus.

Long live the Nymph servants.

 

Sun, 10/06/2013 - 16:08 | 4028193 dirtyfiles
dirtyfiles's picture

money knows who the real owner is ....or something like that

Sun, 10/06/2013 - 16:11 | 4028197 threeputting
threeputting's picture

This is all because they are on a pseudo gold standard.

If they could print, they would be prosperous like America.

/sarc

Sun, 10/06/2013 - 16:14 | 4028209 Devotional
Devotional's picture

Can you believe the nerve of any European that states that the Euro is partially backed by GOLD? Amazing. Then these EU fanatics scream out RECOVERY from the rooftops!

WTF man???

Do NOT follow this link or you will be banned from the site!