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Germany Slams Greek Bailout Extension Proposal As "Trojan Horse" - Full Text
As leaked by Reuters moments ago, here is the text of a document that describes Germany's position on Greece's letter requesting an extension of its bailout facility as nothing short of a Trojan Horse.
Euro zone officials said the paper was prepared for a meeting of the Euro Working Group in Brussels, a gathering of officials preparing a meeting of the Eurogroup of euro zone finance ministers to be held in Brussels on Friday:
"The Greek letter is not clear at all, but opens immense room for interpretation. To mention the three most important points: It includes no clear commitment to successfully conclude the current programme and its falls short of a clear freeze of Greek measures. It is totally unclear how the Greek government wants to pay its bills over the coming weeks with the current shortfall in tax receipts.
This is why the letter is not in line with the last Eurogroup position. It rather represents a Trojan horse, intending to get bridge financing and in substance putting an end to the current programme. On this basis it makes no sense to start drafting a Eurogroup statement on Friday. We should aim at three things now:
First, the three institutions should carefully examine the Greek current fiscal position in relation to the letter and give us their advice, as agreed in the last Eurogroup, whether on the basis of the Greek letter a successful conclusion of the current programme would be possible, with a sufficient primary surplus and debt sustainability to be assured.
Second, we need a clear and convincing commitment by Greece, which may just contain three short and well understandable sentences: “We apply for the extension of the current programme, making use of built-in flexibility. We will agree with the institutions any changes in measures from the existing MoU. And we aim at successfully concluding the programme”.
Third, Greece has to publicly confirm that it will refrain from unilateral national measures to roll back the current programme. The authorities will, with immediate effect, not take any initiative or implement any measure or policy which is inconsistent with existing commitments under the current programme or aggravate the fiscal situation. This includes refraining from announced labour market and social reforms to be voted in Parliament this week.
The 10.9 billion euros earmarked for banking recapitalisation should not be prolonged since the Greek banks have successfully passed the stress test last year."
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That's the Trojan calling the Trojan black.
How many Trojans in a pack?
It Is A Trojan Horse, and there are broke dick Portuguese, Spaniards, Italians & Frenchmen up in its bowels, en masse!
Just so. The Greeks are a pimple on the ass of Europe's real problems.
Quit crying over spilled milk, and get on with the division of the Euro Zone.
Third, Greece has to publicly confirm that it will refrain from unilateral national measures to roll back the current programme.
In other words, "Greece has to agree to maintain status quo: That is, borrow from us on our terms, repay to us on our terms, and be a good little slave."
End it already Greece.
What Greece and the press seems to be missing in all of this is it is not the Germans who are impossing austerity on Greece.
Greece has no money, without external funding from Germany Greece would experience massive austerity.
What they are complaining about is Germany is only willing to fund part of their shortfall, implying that Greece has to cut spending for the remainder. It is absurd to think Germany should keep funding Greece's complete shortfall.
If there is no deal, and Germany stops supplying new funding, then Greece will experience even more austerity than it already has, because now it would have to cut spending to match the complete shortfall.
This is the end game, CBs can only delay bankruptcy, but they can not stop it. Greece is a bankrupt child demanding a permanent living stipend from his parents.
No, Greece is running a primary surplus. That means if it defaulted on its debt, it could pay its day-to-day outgoings... without the need to borrow.
The debt is odious. What right does a government have to borrow money on behalf of citizens that have not even been born yet? We condemn countries where children inherit their parents' private debts; how is this any different?
End it, Greece!
"Perhaps we need a large wooden badger...??"
If you believe their numbers. The same numbers that they used to get into the Euro that were found later to be completely fraudulent.
Regardless of whether their numbers are correct, they can't pay their debt off, can they? If they're not running a primary surplus, what sense does it make to borrow even more money when they can't repay what they've borrowed already?
Let me answer that question. The more they borrow, the more Greece itself will be held as collateral, and the more the bankers will get their hands on in exchange for their out-of-thin-air credit money.
What a fucking scam.
Greece: We'd like to get into the Euro.
Goldman: We can help you with that.
...
Greece: We'd like to get out of the Euro.
Goldman: We can help you with that.
zaphod, yes, I don't understand why this is so hard for people to understand on here.
Neither the EU or Greece is in the right, we shouldn't be picking sides. Fuck, it's like R vs D.
After 100 years of central banking, everyone now believes that money grows on trees for free, and so need to find people to blame when there they do not receive the free money they believe they are entitled to.
Yep. I thought people on here were fiat and Fed haters.
Guess they just like sticking it to the bankers and are missing half the picture?
Odd that central banks that extend bad loans cannot go bankrupt then...
Now that there is no risk in central banking anymore, there is also no value...
As you point out, the bankruptcy and austerity is in fact inevitable...
well said, Laws..
You don't think Greece realizes this? They're going down no matter what. Can't blame them for trying... plus, this way, when the country falls into a sinkhole they now have someone to point the finger at - Germany.
Zaphod,
Someone started this narrative and the ZH sheep are running with it.
Everyone on this site can recognize the problem in the US. (Free shit)
But can't relate it outside their own little world.
Greece wants out of ANY and ALL debts......period.
AND
They want to be loaned MORE $$$ to continue their EXISTING policies.
Extend and Pretend is of crucial importance to the EU. It allows the Troika to maintain the illusion that they, the Euro, and all EU nations are financially sound. Notice that the key demand made by the Troika to Greece now is that Greece accept more loans from the Troika. As David Stockman and others have pointed out, that makes no financial sense at all.
The key to understanding the EU demand that Greece continue to Extend and Pretend lies in the fact that the EU has long passed the point at which financial facts are the key to dealing with the EU's economic and financial problems. The problems are political - how do the politicians and the EC maintain the illusion that all is under control?
The debts of the PIIGS nations are far beyond their ability to ever pay them off. Worse, their debts continue to increase.
The Euro has become a trap for the less-competitive members of the Euro zone, and a boon for the more competitive. Germany runs huge trade and current account surpluses with other Euro nations, but those other nations cannot devalue their currencies or adjust interest rates to adjust for their trade account deficits or for their lower competitiveness.
The adoption of the Euro, and the fact that no individual nation could print Euros or devalue its currency, removed the exchange-rate risks formerly faced by banks lending to the countries of southern Europe, which had formerly had poor credit ratings and therefore faced high interest rates on their borrowings. The banks of Germany, Italy, and France went on a lending spree to Greece, buying Greek government bonds and lending money to Greek banks. The lending banks enjoyed an implied guarantee from the European Central Bank and EC that no lender would suffer in a default on Euro obligations by any Euro nation.
After the EU caught contagion from the US financial meltdown of 2008, it became clear that the Greek bonds and IOUs from Greek banks were worth little. The "bailout of Greece" in 2010 was actually a bailout of the German, Italian, and French banks. The Troika bought the worthless Greek bonds and Greek bank IOUs, and gave a bit of money to Greece while forcing Greece to accept new budgetary rules that prioritized debt payment above all else.
The same pattern was applied in Spain, Portugal, and Ireland.
Austerity has not produced economic growth to any extent. The people of Greece, Spain, Portugal and Ireland live in straitened circumstances with high unemployment and lowered living standards.
BUT the balance sheets of the banks that lent to the PIIGS nations have been made to look good. The unpayable debts of the PIIGS nations and their banks are now held mostly by the Troika.
Greece's new government is demanding the removal of the austerity rules, and a write-down of the debts, and threatens to default if no new deal is given. The Troika fears that other PIIGS nations may echo Greece's demands. Since the bonds held by the Troika can never be paid off anyway, what does it matter if Greece repudiates the bond debts?
Repudiation by the Greeks would have effects having more political than financial importance. First, repudiation would expose the reality of the worthlessness of the Greek bonds, and force the holders of those bonds to write down their value on their balance sheets. That would immediately expose the shaky nature of the Troika's balance sheets, and shake market confidence in the Euro. Any success by the Greeks in renegotiating their bailout/austerity will embolden other PIIGS politicians to try the same.
EU politicians would face the wrath of their voters when it became clear that each EU country that contributed to the bailout funds would not recover the lent money, and would have to contribute even more to make up the losses of the Troika, under the European Financial Stability Facility (EFSF). This appears to be why Merkel is so adamant that Greece not be allowed any adjustment of its "bailout" deal of 2010.
An analysis of the EFSF shortly after it was introduced exposed its frailty. Under the EFSF, each EU nation guaranteed the debts of the others. But in case of a default, fewer nations would be left with the obligations of all, tending to lead to further defaults as the next-weakest nations defaulted on their share of the accumulating costs of meeting guarantee obligations. The inevitable result is a cascade of defaults, with the stronger nations eventually being left owing all default bailout obligations, and perhaps going under themselves.
Enter Super Mario Draghi with his QE bond-buying program. The ECB will buy sovereign bonds and even corporate bonds. Effectively, this gives each Euro nation a printing press to print Euros, up to whatever amount Draghi will allow the ECB to buy in bonds from each nation. For now, he says the ECB will not buy Greek bonds, but that may change during negotiations. The QE would allow all EU nations to create new Euros out of thin air, perhaps issuing bonds with zero interest rates and near-infinity terms, easing any concerns about having to meet obligations under EFSF guarantees with new taxes or money borrowed in public or commercial markets.
In other words, the ECB QE program is part and parcel of the Extend and Pretend game.
Great to see a commenter on here who knows what they're talking about.
remember that billionaire finance guy, had a good for nothing son. living off his stippend, of about $500 a month and $2000 rent money. well daddy cut the $500 stippend down to $300 a month, and sonny boy went and shot him in the head as thanks. the boy was about 30.
And this zinger:
"This includes refraining from announced labour market and social reforms to be voted in Parliament this week."
Translation: "Don't govern nor serve your citizens, pay our banks."
No, stick with the deal you made. They could have refused years ago, but they didn't. So now they have to pay the piper.
No, stick with the deal you made.
Syriza didn't make the deal, though, did they?
So now they have to pay the piper.
And who the fuck is 'they'? People who weren't even born when the lying governments got voted into power? The people who voted against those same governments?
You collectivists make me sick.
No Democracy in the ancient home of Democracy...? Somehow I think the people (demos) will triumph here. They hold all the aces and the banksters and their EU stooges know it.
Exactly. The Greek people said no plus ai bought a bag of popcorn for this show. I am so tired of being disapointed by this can kicking . How much road can possibly be left. Lets see whats in this hose hopefully john holmes lent his dick before he died and merkel can stick it up her ass
When does this shit end?
When the people of Greece demand a new government.
LMFAO!!! They just did, and got exactly what they voted for.
Fuck em both, let the Greeks fix Greece.
Done a smack up job on the acropolis over the years.
Time for Greece to sack up and leave. That's why Greece elected Syriza in the first place. If Vaourfuckis and Tshitras come back to Greece having folded, the people will fill Varoufuckis' swimming pool with piss and worse to Tshitras.
Greece has been this way since well before the EU but now they are in debt to a loanshark who'll send around their leg breakers to make sure they get paid. The problem here is Germany is doing this in the worst way they can think of and countries like Spain are watching this and saying "we're next".
They all should be so lucky like the Americans who will get Hillarious Hillary as their next president....
"What difference does it make?!"
I'm long on popcorn futures.
the game "hot potato" comes to mind.
Reminds me of a toy I had as a kid called "Time Bomb" that looked like an old fused round shell you wound up and tossed it around and if it went off "Buzzer" you went out of the game. Damn, brings back memories.
You'd probably get locked up as a terrorist now.
Playing pass the parcel in a Belfast pub not long ago.
First week of March. Then my guess is we will know if Greece stays or goes. 3rd option is another can kicking event for maybe another year. Unknown wild card is how receptive is Russia and China to step in and fund Greece. That would open up a whole nother can of worms all they way down to NATO membership.
Spring is protest season in Europe and we should have some big ones this year.....
When does the S_ _ t end?
When the other guy runs out of $$$!
The best thing Varoufakis has done is highlight who actually will be left holding the bag when Greece defaults: European Taxpayers.
He's exposed the 2010 bailouts as the Heists they were. Good luck to Greece, I'm rooting for you.
The 4 bankers on this blog down voted that comment.
Better that Greece defaults now rather than the Euro group pour more good money onto this problem.
Unless the Euro group needs to offload more bad debt to the taxpayers....
I think Greece has been in debt %70 of the time. I look forward to them splitting form the euro, and going it alone, they wont last long. not with all the sugar coated promises their new gove has made. sure pensions will be paid, people will be employed by gove, but they will all be paid in New Drachmas. just like the old deach, but worth 100 times less. the new gov needs to stay in the euro. its just a matter of how much they need to promise to pay. forget paying, they're greeks.
FUCK YOU GERMAN MOTHER FUCKERS...
Let me guess, there was this German milkman...
https://www.youtube.com/watch?v=AkBh6FB8XDM
You'll hate me for this (NSFW):
https://www.youtube.com/watch?v=tiTyIg81Opo
did i really have to clarify "which germans" i was referencing????
whatever people.
Whatever you do..do not talk about the war, Basil.
exactly...im sorry i forgot to thank the Germans for Hitler
whateverthe fuck.
Trojan War references, Nazi references, give the Europeans credit this is a hell of a rhetorical battle. Waiting for Teutons and King Midas to be mentioned
I'm waiting for stories about Vlad the Impaler.
Fortunately Romania keeps finding excuses not to surrender control of her currency to the Germans.
So this is how a failed state behaves; no pain allowed...
Kinda like free phones, free houses, free utilities, free community college, free... Hey, wait a minute... WTF!?
free willy?
Let's leave the Orca out of this.
As leaked by Reuters...
Uh huh. What..not enough tickets being sold to the distraction show.
Greece should join Russia's Eurasian Economic space and gas transit scheme. Fuck the EU!
It's coming.
That's not unlikely but the EU ego's can't see such a thing happening since it's not in their master plan.
It would be good for Greece unless the EU/US decides to "ukraine" them first.
then you would see , prottests, revolutions, snipers, american english speaking mercs...
I love Europe for it's diversity. I love Greece for the sea ,the food etc. I love German cars. That must not be mixed.
Reservoir tip.
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These visionary marxist/socialists have become very tedious & mindlessly boring! Just renege on your responsibilites (as usual) and get it over with so the rest of the creative & productive world can get on with their lives!
Whole EU was a trojan horse from the very beginning.
Winner winner chicken dinner!!!
Funny how that has just fallen off of the radar.
The fearless socialists might want to consider being 'work horses' instead of 'trojan horses!'
Pay it back? Now that is some funny shit!
They can not "pay it" back, dumb ass. so "lend' them some more. They need to pay pensions and other unfunded liabilities.
This whole thing is fucked up way beyound recognition! This steam roller is just now starting to move, a whole lot of flattening to come!
So would that make Varoufakis Odysseus?
At last report his wife Danae was still in Austin packing their bags. Pray Yanis doesn't have to spend ten years in exile or hiding before seeing his wife again.
Technically-allied nations hurling nasty, below-the-belt insults at each other is fucking hilarious.
the greek worm is squirming...what a bunch of deadbeats...if they had any pride left, theyd sell some of their islands and pay off the debt...its not that greece cant repay if it wants to...its that they dont want to, and never intended to...that is called theft and fraud.
But that would mean abandoning their cultural socialist policy of enjoying the fruits of other peoples efforts! A non starter!
Yeah, cuz every other country in the West intends paying off their 100+% debt-to-GDP, right?
Greece is just a few years ahead of the rest of us.
Same deal! Party ends when the other dude runs out of $$$!
Actually, if "Brave New World", "1984", or "Animal Farm" are indeed reflections of the Elite's views and long-term plans - which, so far, they have been, then the plan is to bankrupt most people, then kill off the excess eaters in endless warfare, and allow the survivors to live-on to the degree they are non-threatening self-sufficient 'primitives' (Brave New World) or 'proles' (1984).
So, no, they really believe in New Economics, that wealth - not money, but WEALTH - can be printed, and that no innovation is needed once human reproduction can be controlled.
Remember that this whole philosophy is born of Eugenics for Nietzschein ends plus Marxist economics modified for Nationalism - ergo Fascism.
This has nothing to do with Capitalism.
Varoufakis and Tsipras are on the record against the 2011 bailout at the time. Theft and fraud is by those who received or profited from the bailout money : banks and greek "elite"...
Ve are nichts expectant for greeks zu bailout of the bailout, nein.
Plan 'B': Ignore them and maybe they will go away?
"What hump?"
"Second, we need a clear and convincing commitment by Greece, which may just contain three short and well understandable sentences: “We apply for the extension of the current programme, making use of built-in flexibility. We will agree with the institutions any changes in measures from the existing MoU. And we aim at successfully concluding the programme”
3 sentences? I can compress that into a single word: 'Obey!'
I can shorten thatby two letters; NO!
"As leaked by Reuters moments ago"
Be right back; I've gotto take a leak in the water, the crocodile way.
Mutti imagines herself as Priam and Schauble as Hector.
Wow, I wonder who is Helen in their awesome, demented imagination?
It must be....Deutsche Bank!!
A face that launched a thousand Derivative scams!
What a let down !
I am for Yanis playing at introducing the Horse into Mutti's back yard!
He doesn't look like an Agamemnon, more like a condemned Spartacus!
Socialism kills!
When Greece runs out of money, how long will it take until circulation/adoption of a new currency is fully established? Until such a time everyone is paid by IOU I suppose?
As fast as their copier machines can spit out Drachma.
My favorite part is when the socialists blame all the speculators & capitalists & free-markets for their self-inflicted problems!
"If only we had a tighter choke-hold!" -- Every politician, ever
That's the deal!
Greece needs Goldman Sachs right now to hide their bad assets again....
Everyone hates the Germans for not giving them money.
Civilization cannot survive on a theft ethic.
No work-ethic, no life.
Those who do not produce do not eat. That is a Law of Nature that no group of men can change.
In economic terms it is called 'Scarcity'.
While many hate the Germans, the Germans are producing more than they eat. They have some to share. Those who hate them are producing less than they are eating.
One who asks others with extra to share is called a 'beggar'.
One who tells others with (or without) to share backed with a threat is called 'thief'.
When others are hating the Germans, they are hating their benefactors.
You get less of the things you hate...another law of humanity.
In the rarefied air of the Welfare State over the last 75 years a lot of counter-survival behavior has developed.
One way or another it will earn its justified Darwinian ends.
Well I for one am going to get some Feta cheese on the way home.
Fuck You Malaka !!!!!!!!!!!!1
Amazing ... Germany demands in all three paragraphs, the one thing the Greeks repeatedly keep saying the will not do - not in three sentences, but one word "NO"!
Maybe they need to spell it out " N E I N" so Germany can understand.
The more of this non-communication "communication" goes on, in the end ONE side will have to cave! With a Trojan Horse, of a Fig Leaf.
Greece, just take the damn bailout and then "forget" to make the promised budget cuts. If the EU were going to cut you off, they would have done so long ago. They're keeping you on life support because if *one* democratic social welfare state dies, they all die.
The Euro is in a Slow Motion Meltdown.
Many have seen this coming for quite some time.
They cannot stop it.
The meltdown will gain force and momentum after Grexit.
Sorry Angela.