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If The Troika Says "Nein" Tomorrow, Here's What The "New Drachma" Will Look Like
While Greek officials remain 'confident' of their ability to deliver a reform package that the Troika-esque "institutions" will accept tomorrow (notably a bank holiday in Greece), it appears the Germans are not so sure. Hans Michelbach, a finance expert of the Christian Social Union, told the Handelsblatt newspaper it is "inconceivable that the German parliament can make a final decision on the bridge program for Greece before the end of February." Having already seemed to capitulate on the promises made to the electorate, and now beginning to crack down on tax evasion, we wonder how long it will be before the dreaded 'Drachmatization' occurs (by dictat or revolution).
After the cabinet council on Saturday Yanis Varoufakis told reporters...
“I am almost certain our list with the reforms will be approved by the institutions, they won’t say no. If institutions say No on Monday, there will be a eurogroup meeting on Tuesday. I hope they say Yes.”
The Greek proposals are thought as structural reforms to be legislated and implemented for the time of the “Bridge-Program”, but the "institutions" do not seem as confident...
The German parliament is unlikely to approve extending Greece's bailout before it expires at the end of the month, a senior lawmaker of Germany's ruling coalition said Sunday, according to Bloomberg...
Hans Michelbach, a finance expert of the Christian Social Union, told the Handelsblatt newspaper it is "inconceivable that the German parliament can make a final decision on the bridge program for Greece before the end of February."
The CSU is the Bavarian sister party of Chancellor Angela Merkel's Christian Democrats. The finance ministers of Greece and the other eurozone countries agreed on Friday to an extension of the bailout program for the highly indebted country, which has to be approved by the parliaments of some of the supporting countries, including Germany.
The Greek overhaul proposals must be examined thoroughly by the governments and the parliaments, and that process won't be concluded by Feb. 28, Mr. Michelbach said.
If there is a "nein" tomorrow then Tsipras has stated that he will call for an emergency Eurogroup meeting on Tuesday.
Meanwhile, as The BBC reports, as if the capitulation on promises were not enough to stir the angst-ridden heart of the Greek population, the Greek government will crack down on tax evasion and streamline its civil service in its bid to secure a bailout extension, minister of state Nikos Pappas says...
The government is working on a package of reforms that it must submit to international creditors on Monday.
If the reforms are approved, Greece will be granted a vital four-month extension on its debt repayments.
Mr Pappas said the reforms being proposed would take the Greek economy "out of sedation".
"We are compiling a list of measures to make the Greek civil service more effective and to combat tax evasion," he told Greece's Mega Channel.
He added that talks this week would be "a daily battle... every centimetre of ground must be won with effort".
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And so, while the world appears to believe a deal is done... it remains very much in limbo at the mercy of the Germans. And in case anyone was wondering, The Greeks have already drawn up the "New Drachma" notes... just in case...
As News247 reported in 2013, the 6 banknotes (designed by Paul Vatikioti) of 50, 100, 200, 500, 1000 and 10,000 drachmas have pictures of Cornelius Castoriadis, Odysseus Elytis, Yiannis Moralis, Georgios Papanikolaou, Melina Mercouri and Maria Callas...
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Good luck tomorrow Yanis...
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Yikes. Ugly old men.
I laughed so hard when everyone got all excited about the idiot commies that the Greeks elected that were talking tough and making big threats to the ECB. "Tsipiris and Varoufakis, these guys are the real deal!"- "Oooohhh, Varoufakis has a shaved head and doesn't wear a tie- he must really mean business!" LOL! First thing- NEVER, EVER trust ANY politician. Second thing- ESPECIALLY if they come from the 'left' side of the political spectrum. These people cannot admit the truth or face reality to THEMSELVES! Their entire belief system is constructed around lies and voluntary ignorance of reality, how do you expect them to ever keep their word to voters?
Lets face facts- no one is leaving anything and no one is defaulting on anything. This game will continue until it can't and it will be economic reality that finally FORCES action. No politician or organization can EVER muster the political will to do what is necessary to start correcting this giant pile of steaming bullshit. The voting public simply will not tolerate any kind of serious economic reforms. Nope, the 'show' will go on until it can't.
The new Drachma should have a picture of a Trojan Horse with Angela Merkel as the head of the horse that shoots German notes out its backside.
It looks like Veroufakis brought Greeks Austerity to end all Austerities. I sincerely hope not. Those Drahmas bills look good though.
I'm just left wondering how they will pay for the toner ?
*** a small back of the hanky calculation of what the current scuffle is really about
- as a reminder, Greek GDP per person, at roughly EUR 17’000, is still higher then that of Portugal, Estonia, Slovakia, Lithuania and Latvia (EUR users) and that of the Czech Republic, Poland, Croatia, Hungary, Romania and Bulgaria (non-EUR users)
- In 2014, according to the OECD sources, Greece collected taxes on personal income of 13,5 billion, on corporate income of 2 bn, on social security contributions for 22 bn, on property for 3.6 bn and on goods/services/VAT of 25 bn, for a total of 65,4 billion EUR Greek tax income
- Broken down to the roughly 10 million Greeks, Tax collected per person is at roughly 6’500 Euros per Greek, man, woman or child, which is equivalent to a tax burden to GDP ratio of 33%, which is the OECD countries average
- The government debt service… to simplify, thee quarters of the Greek debt is in the hand of the bailout nations, and does not pay interest until 2023, which means that the only debt that has to be serviced for the next years is that on the markets, which is the equivalent of 40% Debt-to-GDP, instead of the scary 170% total
So what is the whole thing about? From a point of view of an average Greek, the state collects 6’500 EUR from him (directly, indirectly, but at the end, from him), which is an average tax burden, among OECD countries
The real fight is about how much deficit or surplus, with the european partners asking for a budget surplus of 4%
Traduced to the average Greek, this means that of those 6’500, some 260 per head should not be spent, and set aside, while the Greek Government would prefer to spend more, i.e. nearly the whole income, and differently
Of course, EUR 260 per person is not irrelevant, particularly in a country where many make less then EUR 500 per month
And so the Greek government is trying to find different things it could economize on in it's budget, to the tune of 7 bn, i.e. 700 EUR per Greek
Meanwhile, nearly all the talk in the media is about the debt, not the budget, and numbers are hard to get, then they could spoil the various narratives
The Greek government (like all government) need to spend less before anything.
The problem is too large government with chronic spending and deficit.
I can't believe we've arrived at a time where evwrything relies upon the Germans. This can't turn out well.
They're nicer pretty pieces of paper than euros I guess.
So how will these drachmas be issued? They should be issued at parity wth the Euro, 1 to 1 exchange. If the Greeks understand what they are doing (and I think they do) there will be a conversion of 1 drachma to 1 Euro. They can peg it for a couple of years and then let it float.
At least by doing that they have control over their own currency. Instead of leaving the printing to the ECB, the Greeks can do it themselvers. Having a parity with the Euro would help ease tings over to the new system.
Will Greece exit? I'm betting they will. The talks that have been concluded are just enough cover to allow the Greeks, Troika and Europe to bid farewell to each other. Probably Grexit by June.
A tax level of 33% versus GDP??? Lucky bastards, in Belgium it is 55%. FIFTY FIVE PERCENT OF GDP. And still the "government" has a budget deficit.
I think they're missing some zeros...
Notice they all have "human" faces on them ... and usually of politicians ... the most inept humans among humans? We need to get away from putting human faces on our money (i.e. our certificates of "promises to complete trades"). We need images with more integrity to go with our "chit" that represents a trader's (and a Medium of Exchange's) integrity.
Can someone explain to me how Greek businesses execute contracts written prior to the Grexit? How do they pay the rest of the purchase contract? They'd have to find (buy) Euro's or Dollars or whatever to complete the contract. That will cost them dearly the day after they exit, no? How do Greek banks then continue to be liquid under the circumstances? I see complete chaos for months on end. And the funniest of all things, is that the tourists who flock to Greece will not know which way is up or down. No one will.
How dare they waste paper printing these drachmas when there are poor children in Venezeula with no toilet paper??!!
They should go 100% digital so they can really fuck shit up.