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Greece €400 Million Short For Wage And Pension Payments, Rushes To Pass Troika-Friendly Laws
There was a brief bout of Greek risk-on euphoria following yesterday's latest twist in the winding road to the Greek insolvency, in which the Greek finance minister Varoufakis became the latest sacrificial scapegoat to be "Nav Sarao-ed" to the angry gods of the Troika, and has been henceforth kicked out of any negotiations with the Greek "institution" creditors.
The core problem for Greece, however, remains: namely that it is still completely out of money, and as we learned yesterday, the local municipalities have mutinied, and told the government they would not hand over their cash to the central bank without their own conditions being met first, and certainly not before May 7 which may well be too late for Greece.
Which means that suddenly not only does Greece not have the nearly €1 billion in cash it will need to fund May payments to the IMF, but it is suddenly short by €400 million for wage and pension payments.
According to Bloomberg, the Greek government is €400 million short of the amount needed for payment of pensions and salaries this month, citing a Kathimerini report.
Surprisingly, this takes place even as Greece’s IKA, OGA pension funds have been informed by the government that amount needed for payment of pensions will be deposited today, while the Greece’s OAEE pension fund has said payment of pensions won’t be a problem.
In other words, someone is not telling the truth: either there is enough money or there isn't. And if the latter case is valid, then either the government or the pensions are now openly lying to the population.
This news follows a late, three-hour interview with the Greek PM on Skai TV, in which Tsipras "voiced hope that bailout talks between the cash-strapped country and its international creditors are "very close" to an initial deal, and ruled out early elections if the dragging negotiations fail."
The ever optimistic Greek leader said that he believes a first agreement can be struck by the end of next week, which can then be ratified by Greece's European partners.
"I think that by May 9 we will have an agreement" that will allow release of some bailout funds, he said in a three-hour interview screened just before midnight Monday. How that is possible when Germany has repeated on many occasions that it would not consider a piece-meal deal is unclear, but perhaps things have indeed changed and all it took was a Varoufakis pink slip.
Tsipras said that if the government has to choose, "our priority is our responsibility towards society, it is (paying) pensions and salaries."
Creditors are demanding further reforms and savings, and have encountered strong opposition from Tsipras' government that was elected on promises to alleviate five years of income cuts and fiscal pain.
Tsipras ruled out early elections if the talks fail. But, while insisting he expects an agreement, he did not exclude holding a referendum on the matter.
"If I end up having an agreement that puts me outside the limits (of my mandate), I will have no other resort," he said. "The people will decide — obviously without elections, I want to make that clear."
What is also curious is that during the interview Tsipras once again pivoted strongly toward Russia saying that "Greece is key for the Russian gas pipeline", adding that the Turkish Stream pipeline would lower Greek powr costs, and that Greece could get €3 billion for the gas pipeline deal.
Hopefully the Greek PM understands that he is merely antagonizing the EU every time he mentions the Kremlin: his final negotiating trump card.
So in an attempt to offset any "pent up" Troika anger, earlier today we also learned that the Greek government is planning to pass into law various measures that the creditors agree on, such as a single value-added tax rate abolishing all existing exemptions, according to Brussels officials. According to Kathimerini, "sources from the seat of the European Commission speak of a flat 18 percent VAT rate for all services and commodities with the exception of medicines, to come into force by the second half of the year. For now Athens categorically refutes such a scenario, noting that negotiations are still ongoing."
Among the bevy of other measures which will be included in the bill are the following as laid out by Greek Naftemporiki and as summarized by Bloomberg:
- Measures to implement 20% tax on TV advertising
- Increase sales tax rate on luxury goods
- Strengthen tax dispute resolution mechanism to speed up closure of pending cases
- Improve online VAT payment model
- Improve monitoring of digital economy by tax authority
- Make tax code easier to bring criminal cases for large- scale evaders
- VAT lottery scheme to reward customers demanding receipts
- Charge fees for issuance of e-gaming licenses
- Auction licenses for TV station frequencies
- Strengthen independence of public revenue authority
The proposed legislation won’t include areas where Greece, creditors disagree, such as pension reform, creation of bad bank, new luxury hotel tax, streamlining VAT rates. Areas where Greece disagrees with creditors to be resolved within broader agreement in June. The legislation to be discussed at Cabinet on Thursday
Will this be enough to appease the Troika who will hand over Greek just enough money so that Greece can make the next payment to the troika due in a few short days, will be revealed in a few days, but one person who will henceforth be watching from the sidelines will be the Greek (soon to be former?) finance minister Yanis Varoufakis, who may have been thrown under the bus but...
- TSIPRAS SAYS VAROUFAKIS IS A GREAT ASSET FOR GOVT, GREECE
One wonders, no pun intended, what this asset's haircut is for ECB collateral purposes.
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Well, there is your Syriza for you. LOL.
Throw those pathetic Greeks out of Europe already.
Dominos, bitchez.
Birthplace of democracy...patient zero of implosion.
It ends where it started.
They can still make it 6 more weeks if they pay per week and not per months With a 1 month delay.
This is the last can to kick.
And than the party ends and riots will start wwhich will cause the tourist season to be ond of the worst in history.
One of the effects of falling below stall speed...
You auger in.
Just defaut now! Suffer now or be a slave longer while in misery. Your options stink.
Abraham Lincoln had to deal with the exact same issue:
"Otto von Bismark chancellor of Germany 1876 On the 12th of April 1861 this economic war began. Predictably Lincoln, needing money to finance his war effort, went with his secretary of the treasury to New York to apply for the necessary loans. The money changers wishing the Union to fail offered loans at 24% to 36%. Lincoln declined the offer. An old friend of Lincoln's, Colonel Dick Taylor of Chicago was put in charge of solving the problem of how to finance the war. His solution is recorded as this. "Just get Congress to pass a bill authorising the printing of full legal tender treasury notes... and pay your soldiers with them and go ahead and win your war with them also."
Colonel Dick Taylor When Lincoln asked if the people of America would accept the notes Taylor said. "The people or anyone else will not have any choice in the matter, if you make them full legal tender. They will have the full sanction of the government and be just as good as any money; as Congress is given that express right by the Constitution."
Colonel Dick Taylor 1 Lincoln agreed to try this solution and printed 450 million dollars worth of the new bills using green ink on the back to distinguish them from other notes. "The government should create, issue and circulate all the currency and credit needed to satisfy the spending power of the government and the buying power of consumers..... The privilege of creating and issuing money is not only the supreme prerogative of Government, but it is the Government's greatest creative opportunity. By the adoption of these principles, the long-felt want for a uniform medium will be satisfied. The taxpayers will be saved immense sums of interest, discounts and exchanges. The financing of all public enterprises, the maintenance of stable government and ordered progress, and the conduct of the Treasury will become matters of practical administration. The people can and will be furnished with a currency as safe as their own government. Money will cease to be the master and become the servant of humanity. Democracy will rise superior to the money power."
http://www.xat.org/xat/usury.html
Thanks. The invention of the "greenbacks".
Optimist.
Go tell that to Merkel. Carrying on with this circus is her fault.
You can't throw them out of Europe as Europe is a continent, unless you intend to transport Greece to another part of the world.
Somewhere in Central Africa would be most appropriate.
rED eyes at morning, sailor, take WARING!
The EU bitches about Greece when it took the Greeks in the first place, the Germans knew well what was being covered up. JPM also knew. Europe deserves this mess, - the whole project has always been about quantity over quality.
all bluffing, partying, smart accounting can't cover the track (eh, lies), no?
Hi-yoooooo Syriza....
EU/Euro is the Bus and Greece is the dog tied to it. The dog died a long time ago but the leash still holds, wonder for how long.
Hows about a few days after you don't wake from that dream.
Assets or Asshats?
<-- Can gets kicked and Greeks get thrown under the bus again
<-- Tsipras grows a pair & defaults.
I think the can will be kicked a couple more times before the eventual Grexit.
Who is the well-educated German who decided to loan money to Greece?
who is the Vampire Squid Firmly Attached To The Face Of Humanity that decided that the former Greek government needed help to cook it's books with derivatives?
Who were the dirty kids that turned into problem adults.
I'll take Wall Street White Shoe Boys for 500 Alex.
Daily Double!
there are many, many things that are without costs, in life. but defaults, particularly sovereign defaults, imply costs
personally, if I was governing Greece, I'd steer clearly away from a default, pointing out that it would cost... moar
but this would imply a budget, a forecast series, in short a lot of numbers and calculations, instead of political truthiness (you know, the truth that feels right, in the gut)
If I were leading Greece I would bring a big ass dog to my meeting with Merkel to scare her shitless into giving me a big ass bailout... then once the check clears, I default. Fuck the EU.
You made a bad investment, time to pay up for it bitchez!
I don't understand your reference to Putin's dog and his introduction to the famously dog-phobic Merkel
further, the "Fuck the EU" statement is nowadays also completely unclear. is it meant as criticism of Nuland or just literally?
further, the EU is not Greece's creditor. Germany, The Netherlands and others are
anyway, I'd be making sure I have a balanced budget, before a default. You know, so that I'd be not begging for credit after having damaged my country's credit worthiness
in short, show me someone that is steering towards a balanced budget and I'll show you someone that can default, if needed
just literally?
yes just this for me, all of EU are gutless poodles and deserve a fucking.
gutless poodles? do you mean we should get busy building two dozens supercarriers, a couple of thousand warplanes moar and bomb the shit out of you in order to earn your respect? btw, who is you? if we are gutless, what is your claim to heroism and strenght? a cupboard full of guns and ammo and a big loud mouth? don't be afraid, explain in detail
delete
Feeding frenzy. Unbecoming to join.
who is you?
'me' is one who will live to see the EU fold , the pain currently being inflicted on people will eventually be returned twice fold on germany and brussels. i'm hoping for sooner rather than later, but i'm young enough and can wait a little longer.
i also don't need guns when people will shoot their own feet. ;-)
so you are young, full of hope for "things to go WHAM!" and patient. nope, I don't think it explains where you criticism does come from. in fact, it's not really even criticism, yours. it's just infantile "whaaa!!!". again,
I ask: why "gutless poodles"? from where is this criticism coming from? tell us about your heroic point of view, if you don't have constructive criticism of how things ought to be
So you can plan your next, not so devious' move?
I seem to have gotten a reputation of deviousness. I blame my understanding of how a debate should function among grown-ups. nevertheless, I'm accustomed to debates where if someone calls the other names like gutless, then this same accuser has to explain how he or she isn't so
in short, if you accuse someone to lack courage, then you have to bring examples on how you showed this quality. it's an old question, one that actually started the Ancient Roman debate on ad-hominem, and an Ancient Roman law that criminalized ad-hominem attacks in certain circumstances
or even shorter: if you accuse someone of a lack of courage, you can't hide afterwards without being the even greater coward
Granted, but you all have a nasty habit of assinations when your desires are not met , and the tools of war to persuade all others. Could you have been hoodwinked somehow? And now dues need to be paid, spent fuel rod issues, dowry issues, quality issues, list goes on and on, and so does the silence.
so in "fight club" terms, by jab is "too vicious"? I'm puzzled, but yes, I think you have something there, at least in the sense that you write something many seem to feel
I just wish I'd understand it better, then your comment is the first one shaping a bit the contours of that beast
but what do you mean by "tools of war"?
meanwhile, of course I'm constantly hoodwinked. I'm human, after all. sometimes, I am hoodwinked by myself, then usually the biggest lies one believes are the own
and that's where the honest debate comes in, and helps
silence? you don't mean it, if I see how many times you insert your one-sentence comments! ;-)
Juggling hot potatos is not my forte'.
Srebrenica. Gutless caving to tyrants the world over on numerous occassions. Modern Europe hasn't exactly been a profile in courage whether it was Communists or Jihadists. What exactly is Europe doing to fight the Jihad coming to their cities - whether you want to admit it is a smoldering fire or not.
Printing up a head-hunters guide to the cities?
hiding no more than you ' i don't use my real name but use 'Ghordius' to hide from the world ' cowardice would be having how many US tropps on your soverign soil ? and lacking the balls to send them home.
LoL
fudge, your nick is apt. where do I accuse others of cowardice? meanwhile, you do. and so the onus of showing courage is on you. so again, where does your courage come from?
When living in the land of Booker T's, fantasy becomes the real world and war is always the first, and last, resort.
That needed to be done long ago, only consequences need to be paid now, troubled waters, troubled bridges and such, you know, the things of beauty.
If Greece was to default it would be painful for Greece. I don't think anyone would disagree with you.
The question remains, within the EUR how does Greece look in 5 years? Outside the EUR how does Greece look in 5 years?
On a societal level, I don't know if the people of Greece will tolerate another 5 years of 30% unemployment.
On a financial level, while its still possible as long as the bailouts keep flowing, its contingent upon the creditor nation's societies to be ok with the bailouts.
if that question on how much tolerance for high unemployment was valid, then ZH would have been correct in all those articles two years ago predicting a complete societal collapse of Portugal, Spain and Italy inside of months. and yet we are where we are
fact is that both the US and the UK have a much lower tolerance for unemployment then those southern european countries
fact is also that those countries have a tendency of having overstated unemployment numbers and a much bigger "black" untaxed unofficial economy going on
fact is that those countries have familial structures which are unfathomable for people from such individualistic countries like the US and in part the UK. something I was busy pointing out two years ago, if you remember
but my point remains: if you want to default, get busy balancing your budget so that you don't need further credit. it's a quite universal common sense approach to debt which seems to strike a very angry chord, here
so are we talking about Greece, here in the ZH comment section, or are we just using it as excuse for talking about debt in general and in the US in particular?
We all know that Greece won't balance its' budget. Suggesting as such is a bit silly. They'll print money to fill the gaps, just like the USSA has been doing.
The Drachma will collapse, but it would allow Greece to return to the market on its own feet.
"...but it would allow Greece to return to the market on its own feet"
that's an interesting conviction in "the power of default". would you care to make a historic example for such a scenario? Argentina? the last hyperinflation in the Balkans?
look, Haus, the problem is that it's a conviction. that "the debt" is the culprit, and so if you take "the debt" away, all things are hanky-dory. Syriza is currently riding on this conviction
nevertheless, Greece is heavely dependent on it's tourism industry. whatever you are suggesting, if the Drachma gets reintroduced and then fails, Greece would then be either using the EUR or the USD. Or perhaps the Ruble or the Yuan, though I don't think so
if you plan for a default, you need a plan for life after the default, and this implies, more often then not, either balanced budgets or moar debt. which does not come cheap, after a default
"...just like the USA" does not apply, if you aren't the issuer of the global reserve currency. the whole "tragedy of the USD" is that most Americans don't seem to even understand this little item of reality
Ghordo -- the problem isn't just the debt its the underlying currency.
Lets say, just for example -- Greece gets all its debts forgiven, yet stays in the EUR. It starts out with a budget surplus, the public sector in Greece will re-expand, Greek corruption will flower again in Greece, and in 10-15 years we are in the exact same spot again. Why? Because Greece has been printing money to fill its holes in its budget for a few centuries now.
With the EUR they cannot do that. So even if Greek debt goes away -- without changing the Greek mentality to government involvement in the economy, this is exact same problem would repeat itself. Thus, the only way Greece can be a successful member of the EUR is for the Greeks to materially change the way their government looks at money.
Regrettably, the Greek "lifestyle" is part of the culture. So in order for Greece to be a successful member of the EMZ, the Greeks have to be less Greek. I cannot speak for you, but I don't want that. I want the Greeks to be Greek, even if it isn't what is best for them. Why? Because this is Europe, and its a small place with a ton of different people.
The common currency, but default, reduces the differences between people.
So, Greece's success or failure is dependent upon its people being less Greek. I for one, hope that this doesn't happen.
if your comment was correct, then America would be even more "Greek" then Greece itself, and the American Lifestyle in the last twenty years would have to be called "Pure Greek"
which leads me back to Dick Nixon's "we are all Keynesians, now"
the problem is neither the debt nor the underlying currency. the problem is the way Keynesianims has morphed to Neo-Keynesianism, then "progressed" further and now we have currency wars as a result of all that
and so we witness Neo-Keynesian logic even from people that stack gold, all while projecting issues on other peoples, including the myth that the moar windows get broken, the better things become, afterwards
gold, by this logic, reduced differences throughout the whole world, during the 19th Century, by being the global currency
it's not enough to stack gold, if you don't understand why Classic Liberals were for gold. and this, I fear, would mean you ought to re-examine several of your core assumptions, including "oh, that's part of their culture", when in fact it's an export from another culture, a way more dominant one
America is more next door than greece, it's france and iran put into a blender, and mixing at an extremely slow rate, not yet a mixture of greece, so the default card is the right one, take the pain now, stop drinking, and the debt hangover will go away tomorrow.
"take the pain now" is not "don't pay the bills you have because you are a drunkard" coupled with "and then you can continue to be a drunkard"
"take the pain now" is stop drinking, nurse your hangover, and then, when you know you tamed your addiction, you are in a better position to bargain about that old debt
so no, I find that "the debt hangover" is the wrong way of looking at things. the "hangover" is the pain you experience at first while you live withing your means
Take the pain now means bonds are not paid before cops and many others, the law was made to benifit a choosen few, the same few who control the levers of war, and must get everything they desired and belived in. It's an unsustainable farce and has been for a long time, you've been in a deep deep denial, almost animalistic as more time passes, you'll blow a head gasket just thinkin of not getting paid by your so called "law", so war in the steets it is, the only alternative to bring down the house of unjust cards, one which will not reason senseably, or communicate when your chips are down.
You're right! The Americans are just like the Greeks -- maybe even worse. The difference between the two -- the USSA can print FIAT and the Greeks cannot.
I'm a gold fan, just like you.
Ghordius, I had the feeling that when Greece went onto the Euro, that HURT its tourism industry, and its exports as well. And it made its neighbor Turkey more competitive. Because the Euro is expensive. Also, I don't see why it should be so difficult today for a tourism-dependent country to use a lot of other countries' currencies instead of its own. Because today almost every tourist in the world has some sort of electronic gadget that can instantly tell him how much one currency is worth versus another. So if I owned a hotel in Greece, I could accept Yuan, Yen, Pounds, Euros, Dollars, and anything else a customer wanted to pay me with. I'm not arguing any point, I guess, except maybe that (1) Greece might be better off without the Euro, and (2) I guess I don't know enough to know why Greece even needs the Drachma. Except, of course, for government borrowing, but I agree that the first thing those in financial trouble need to start doing is to stop borrowing, period. Whatever that takes, period.
TheGreatRecovery, the questions you are raising are, at their core, the differences between a "hard" and a "soft" currency
my point of view in such things is that a "soft" currency acts like a subsidy: it allows to borrow more, pay less and by that for example engage in trade wars, for example by increasing the market share of products and industries. as in the case you cited with the Turkish Lira tourist economy versus the Greek EUR tourist economy. For a time
nevertheless, a "soft" currency carries hidden costs. eventually. higher rates, for example. or the fact that savings are plundered by it's devaluation
so yes, a soft currency is a fantastic thing... first. and then comes... regret, and a different and yet similar form of hangover
Ghordius, thanks. (Zimbabwe, Argentina, the German Mark after WW1, etc.)
the greek state budget is in surplus when not considering the debt and interests payments. So the greek state could default. The problem is that Greece still has a huge commercial deficit, and this can only be balanced by more local production. Until Greece cures this deficit it will have no choice but to print drachma to fund it.
Actually, I would never have thought 4 years ago that Greece could obtain a primary fiscal, which it now has...
... because it was pressured by the other european countries, which are all - as per treaties - striving to have balanced budgets
which goes back to a simple fact: it is always possible to live within means. not necessarily palatable, but possible. in fact, there is a huge propaganda machine trying to sell that it's not possible
that commercial deficit? it has to be... financed. no financing of deficit, no deficit. deficits mean... debt, moar of it
look, it's easy. credit can be wielded like drugs by a network of pushers. the last thing the pushers want you to believe is that you can do without the drug
I *honestly* don't know which other european country struggling to have a primary surplus or total deficit under the 3% limit it has agreed on several occasions you are refering...
Re. the propaganda machine, from first hand experience, it doesn't have to be so huge, it just has to seem coherent and good for everyone : if we wait just a bit more there will be growth with more capex and/or more consummation. Thus the government has to provide poors with money so that they can consume (this is the left-appealing version) or give more to corporates/tax less (this is the right-appealing version). Having to battle regularly against this conception, I can just say it is very powerful but does not need any heavy machine. Once the seed is planted, it fills the entire debate, and every dissent is rapidly likened to a deflationist who wants to usher in the Great Depression...
Re. commercial deficit, either Greece adopts a fixed exchange rate with another currency (as was the case under the gold system), and it will have a depression, but this deficit will quickly disappear, or print Drachmas into oblivion to pay for imported goods. Hyper-inflation garanteed in the next 3-6 months...
I must confess at one point I thought Varoufakis would take Greece along the hard path : state budget in surplus and less commercial imports (as it was written in the 40 points of Thessaloniki), and social financing through free housing, local food, and hospitals. Either it was not possible in the timeframe offered to Greece or they didn't dare, but now this looks like a dead end.
look at Ireland, Portugal, Spain, and look at how their governments are talking to the Greek one
but +1, best comments so far. yes, I agree, the propaganda machine does not have to be huge, just "seem coherent and good for everyone"
I confess to the same, regarding to Varoufakis and the 40 points of Thessaloniki. perhaps Tsipras overruled the whole while looking for a further shortcut in geopolitics
but a fiscal year is a long timeframe, our American Cousins at the helm of the financial markets are pushing hard, as hard as those who "care" for the geopolitical side, and soon the touristic season starts
I still expect the next go/no-go inflection point around June, and then again around November. and I also expect cabinet re-shuffles, possibly several of them
still don't agree with the commercial deficit part, but it would take ages to take it apart. just remember how much "Greek funds" are outside Greece, while belonging to Greeks inside Greece
Don't go to the store, and you avoid the pushers.
I predict you will be on the wrong side of nature.
I predict you will continue with this kind of "smart" one-sentence comments
Wrong again einstien.
oh, damn. foiled again
Timer, freezer, bitches, consequences.
I need a new drug, one that won't kill, or come in a pill.
Love is the drug that I'm thinking of.
Also, he who laughs, wins.
I always assume there is more going on than we are being told. I am usually right.
Maybe like the US national debt now frozen since Mar 16, it is entirely possible that the Greeks just do not know their exact cash position?
a Finance Minister's job is actually to know the exact cash position of the finances of the country, among other things. if Varoufakis does not know it, then he is not doing his job
but again, a lot of those articles aren't really about Greece, in the comments. they are taken as reason to talk about US-related things, and about personal debt
"VAT lottery scheme"
this could be straight out of "Idiocracy".
as far as I remember, this is how China collects VAT, and I find this scheme very appealing :
- the client of a shop can ask for lottery tickets up to a face value matching her receipt (pay 20€, asks 20€ in lottery tickets)
- a lottery give for each ticket a 2% win of face value
- tickets can be bought at 20% of face value
=> the 18% difference of face value between the price paid to the state by the seller and the price paid by the state to the customer is the VAT...
This is all about incentives...
btw...
http://en.wikipedia.org/wiki/Uniform_Invoice_lottery
and it was later adopted by PRC:
http://beijing.wikia.com/wiki/Fapiao
but keep downvoting, ignoring reality is such a sound way of life...
Ukraine needs you money, come on Greece!
>>>
Will this be enough to appease the Troika...
<<<
Yes, because the only person who matters is Merkel.
If necessary, she would use German taxpayer money to make payments on Greek debt against no more than a promise that the Greeks would pass such laws (and a further promise to pay Germany back at some point in the (very far) future).
Merkel's 'United States of Europe' dream, born out general German WW2 angst, and magnified by growing up under the East German post WW2 propaganda machine, cannot be allowed to die...
Watson
that's the usual "all alliances are hegemonistic in nature, ergo look for the hegemon"
as such, it implies a lack of understanding of the history of the european continent (among others) while implying a simplified, if somewhat true, understanding of the history of the UK and the US in the last 200 years
what really matters, in this story, is that in the US there are many that think that a GreXit would be something like a new "Lehman Moment"
delete
that's hogwash. seriously, this place used to have good comments. some of them came from... you
there are two kind of politicians: the "convinced" (or bought for, which for this purpose is the same) and the "power brokers"
Merkel is a "power broker", like Helmut Kohl. what she says and does stems from the consensus of the CDU, the CSU and the SPD, all mixed in, in this case, with the consensus of the other EU countries, and the various power-brokering deals with external powers
very little "communist", in this, and a lot of what is commonly called "Realpolitik"
@ Ghordius,
Thanks for holding your own and turning this into an adult debate.
@Ghordius
Right. How does what you describe as "power brokering" exclude hegemony or at least hegemonic tendencies exactly? Especially when Merkel is the only leader in the Eurozone who seems not to be "convinced". Sorry, what you are saying here doesnt fly with me...
>>>
...is that in the US there are many that think that a GreXit would be something like a new "Lehman Moment"
<<<
Difficult to see why:
1. Lehman's failure was unexpected, this saga has been going on for years;
2. By now, anyone who wants out of Greek debt is out of it (in particular, lots of previously bank-owned Greek debt is now owned by taxpayers);
3. The numbers are small compared to total EUR-zone GDP.
So no real shock.
Watson
Most Greek people have lost 85% of their assets, the economy is steadily declining, while debt keeps growing just to make payments on existing debt and more of the same is death for Greece. Their only hope is to default, pay the price and start over which is the only real solution for anyone. The banks just keep sucking Greece dry, buying up its assets pennies on the dollar until it becomes a worthless piece of dust. They will default eventually because this is killing them.
interesting number, this "lost 85% of their assets". how did you calculate it?
Same way Tyler researched this particular pile of garbage that made it to the top today. Kathimerini (which extremely strongly supports Samaras and would like nothing more than to see Syriza off'd with a vengeance) posts some sort of truthy report, every single gov agency basically says no problem, Tyler posts someone in the gov is lying.
Please.
+1 which, in other words, means that Kathimerini is more on the "right", more conservative then the current Greek government, and is carrying the messages of the political opposition to the Greek gov
So under Tsipras austerity gets even more austere in order to repay the IMF and sundry EU lenders.
That will be a big hit with the people who voted for Syriza.
There must be a question whether his party will actually hold together let alone the coalition. His members include the extreme left, some of whom were getting antsy a little while ago about proposals to impose further troika demands on the country.
"So under Tsipras austerity gets even more austere in order to repay the IMF..." -> perhaps
"...and sundry EU (countries) lenders" -> way less. That debt and it's interest is not due before 2023
Edit: note the "downvotes". The truer and factual a statement is, the less it's "liked", eh?
note that for the first time he mentioned the word "referendum"
Yeah, Syriza is just another traitor in the pocket of the troika. The only thing radical going on in Greece is asset stripping on behalf of the international bankster cabal. Here is how the real left views the latest flavour of Greek traitors:
https://www.wsws.org/en/articles/2015/04/28/gree-a28.html
This is the wish of the Greek people. Do you see the polls? Even MORE they want to stay in Euro. They fucked themselves.
It will be interesting about the far left. I suspect they will make a lot of noise but no moves.
Imagine a Benny Hill chase with Greece at the front and the Troika behind!
greeck grandmas' rain bonnets will collateralize XXXX billions of loans and the can will be kicked :)
What a brilliant set of money raising proposals:
Any remaining advertising on Greek TV is about to dry up, which will reduce jobs in TV broadcasting and maybe sink broadcasters. Could be a plus for print media and radio that pick up some of the displaced advertising.
Have to wonder how much luxury goods now being sold in Greece (do they include toilet paper?). Whatever it is will be less in future and tax take less, as sales migrate even more to black market and outside the country.
Strengthen tax dispute resolution, in other words "whatever we say your tax is that's it, immediately". Of course since lots of those being levied have no money there won't be much collected but Tsipras will have made a lot of enemies.
Improve monitoring of digital economy. Are they just going to monitor something or do they have plans to somehow impose taxes. Hope their IT systems are better than Obamacare's. No doubt it will kill any Greece-based digital commerce while giving a minor benefit outside Greece. Probably employ some more bureaucrats.
Make tax code easier to bring criminal code against large-scale evaders. That's what every government says. Who do they think is going to pay the bribes if they do that? And if they try to make it stick there'll be a bunch of wealthy Greeks with new nationalities.
VAT lottery scheme to reward customers demanding receipts. Of course if you win that lottery it will be taxable and the new, improved tax regime will be after its share quick smart. On the other hand your payments from the government are going to be a long way down the queue behind the IMF, ECB and all the other EU creditors. Still, I'm sure Greeks trust government enough to not let that bother them. They'll be all in.
Charge fees for issuance of e-gaming licenses. Sure, why not. How many Greeks are betting money over the internet rather than directly and do they want to deal with Greek-based operations as the government ramps up its scrutiny of who's betting what and who's winning what? Probably not going to be the windfall they imagine.
Auction licenses for TV station frequencies. Doesn't everyone do that? Of course if you are also banging up taxes on TV advertising, so TV advertising disappears, you might have to pay people to get them to take the licenses off your hands.
Strengthen independence of public revenue authority. I guess this means the graft and corruption associated with public revenues and taxes now all gets to stick with the bureaucrats involved, rather than having to be shared with politicians. I'm sure Tsipras' loyal MPs will all be applauding that initiative. In reality it will be just like the laws passed by the US Congress to prevent insider-trading by Congress critters.
When you're desperate and out of touch, it's amazing the fantasies you can come up with to pretend you have a solution.
Yes 20% TV advertising tax is a genuinely great idea , it will mean less corporate mind numbing toxic brainwashing for the Greek people thus enabling them to think more clearly and hopefully awaken to the complete waste of your life that every minute spent in front of corporate TV is . I hav,nt had or watched TV in over 10 years now and it is mentally and spiritually liberating and a reclamation of life , my only regret is how much time I wasted before I gave up this "filthy habit " . I am sure many here are of like mind
+1 to this.
+100 and don't forget hollywood. TV, Movies and media is used to control the masses. To keep the elites in control, rig eletions, push tyranny down people's throats.
Keep watching sheep.
would bet all the measures listed above were given to Tsipras by Brussels. This is all about the Greeks using "too much cash" and not reporting it to the central banker overlords in Brussels so "appropriate taxation" can then be rendered. The independence of the Greeks, at least in this regard, burns their butts-especially since continuing to extend them credit hasn't made their "leadership" rope them in-yet
in greece a 1999 toyota jeep with 90,000 miles on it is considered a luxury vehicle lol if u buy it,luxury taxes apply to junk, more taxation wont solve the problem, which is namely that the greek govt is run by foreigners and that it is too big relative to the size of the population, u cant have half the population working for govt and expect the economy to function for long
India wants its wealthy Hindu temples to deposit their gold in the nation's banks.
What could possibly go wrong?
see how fast it really happens if the NSA offers their services to India
Calling Mr. Putin. . .
"One wonders, no pun intended, what this asset's haircut is for ECB collateral purposes."
The haircut on the V man must be higher than the haircut Spain got on Ronoldo:)
Why is it that I come to zerohedge, and sometimes think I got redirected to 'Ghordius Blog'. JFC, give it up! The EU was a bad idea at the start, it was implemented badly, and is now hurting a LOT of people (not only in Greece). It doesn't help that TPTB in the EU have decided that they need the biggect, smartest offices in the biggest buildings, at massive cost over-runs, all paid for by the very unwilling taxpayers of Europe, and this after they have already paid through the nose for their own now-largely-useless governments.
When will this EU crap end?
you are right, I posted too much here on this article. well, gotta go, you have the whole day to read other comments
meanwhile, WHEN WILL THIS CRAP END?
I mean, again I have to read from your comment the usual "The EU was a bad idea at the start, it was implemented badly..." which just shows that commenters like you still can't differentiate between the EU Club which has 28 countries as members and the EUR Club which has 19 contries as members
that's a difference of nearly a dozen countries
the TWO freaking clubs are separate from each other. one is a trade club, the other is a monetary club. one could fail and the other still go on, but no, let's have shallow, superficial comments devoid from any relevance to reality
have a good day
Just imagine how difficult it is to run 57 States...
IMHO, the Euro was the bad idea. And unnecessary. So easy to calculate exchange rates these days. Anyone with an iPhone can do it in ten seconds.
They should start right away by cutting the government pensions because the commies who were in charge all these years were the ones who made the outrageous promises in the first place. Same for France, UK, USA, California, and bankrupt city of Detroit.
THERE IS NOTHING MORE WASTEFUL ON THE PLANET THAN GIVING MONEY TO A GOVERNMENT - that's my creed and I'm sticking to it....
This is the lever to do away with sovereignty.
The single Europe....
Debt works on individuals and on countries.
Time to break out the digital can.
Pavlos Zafiropoulos 07 Apr. 15 (16:52)
The Greek government is under fire for giving the go-ahead for a 500 million dollar contract for the modernization of 5 navy planes over three and a half decades old.
Pressure is increasing on the government over its controversial decision to award a 500 million dollar contract to Lockheed Martin for the modernization of 5 dated submarine-hunting warplanes currently owned by the Greek navy.
The decision, which was publicized last week by the newspaper Proto Thema, was approved by the Government Council for Foreign Affairs and Defense (KYSEA) on March 15th.
Specifically the decision which was signed by both the Prime Minister Alexis Tsipras and the Defense Minister Panos Kammenos,would see a half billion dollars spent on the modernization and maintenance of five of the six P-38 Orion airplanes currently owned by the Greek navy. The planes, which are 35 years old, have been idle since 2009 when the Supreme Naval Council deemed their modernization too costly.
The new decision would see the planes modernized and their lifespans increased by 15,000 flight hours. That would mean that each additional hour of flight time for each plane will come at a cost of over 6,500 dollars to the state. The upgrading project is scheduled to last 7 years, meaning that when the final delivery of the aircraft will be made, they will be over 40 years old.
The contract is also to be directly awarded to Lockheed Martin as opposed to being subject to an international tender process.
The decision with its half-billion dollar price-tag (the first major arms deal in 10 years) drew immediate condemnation from the public and opposition parties – especially given that it is coming at a time when Greece is in the midst of a cash crunch which could see the government run out of money and default within a few weeks if additional loan tranches are not released by Greece’s official lenders.
Defense Ministry responds:In response to the criticism the Defense Ministry issued a statement defending the decision to modernize the planes in which it argued that:
- The agreement to upgrade the planes was the product of a bilateral deal between Greece and the USA and includes the inviolable condition of the Greek side that the work be done in Greece by Greek industry.
- The specific aircraft are used by many countries including the USA, Germany, Canada, Japan, Norway, South Korea, Australia and others, with all of the countries maintaining the planes.
- The option of upgrading the planes was deemed preferable to purchasing new planes for a number of reasons. The lifespan of the planes will be extended for at least 20 years, we already possess spare parts for the specific type of plane, trained personnel and an organized support unit.
- The purchase of decommissioned airplanes of the US Navy had also been proposed but they would have required the same upgrades at greater expense, while all of the work would have been performed in the USA and not Greece.
- The Hellenic Navy had proposed for the upgrade to be done via Foreign Military Sales (FMS) and the decision had been authorized by the Government Council for Foreign Affairs and Defense in August 2014. Subsequently the same agreement was signed and passed by KYSEA with the same terms and funding by today’s government on March 15 2015 which was the ultimate deadline.
Controversy continuesHowever the Defense Ministry’s statement failed to satisfy many who question whether the particular arms deal was the most pressing for the Greek military which, like the rest of the Greek state since 2009, has been starved of funds for years.
The decision did not even have unanimous government support, with two Deputy Defnese ministers, Kostas Isihos and Nikos Toskas having disagreed with the decision and specifically the decision to pay a 45 million euro downpayment to Lockheed Martin, according to reporting by Ta Nea newspaper.
The revelation about the deal also prompted criticism from outside the country such as from Germany’s Bild which featured a full page spread on the story. “They are trying to avoid bankruptcy, but from what it seems for arms deals, there is money!’ the paper wrote in its characteristically critical tone.
Four questionsToday Yiannis Ragkousis, an opposition MP with New Democracy and former deputy defense minister warned that Tsipras and Kammenos were at risk of being ‘heavily exposed’ if they failed to provide substantive answers to key questions.
He accused the leaders of SYRIZA and Independent Greeks of deliberately having tried to conceal the deal from the Greek public and called on the two men to answer the following points:
Ragkousis went on to note that a lack of transparency had, in the past, led to well-known abuses of funds in the procurement of defense systems, ultimately weakening the country’s national security planning. He writes that, “almost all of the ingredients of the dirty past appear to exist in the specific decision of the Tsipras-Kammenos government.”
Yesterday appearing on the TV program Enikos, the Defense Minister defended the decision arguing that it had “bothered the weapons dealers as there was no bribe. It is not being directly awarded, it is being done with a binational agreement.”
He stated that the deal would have expired had he not signed it and that if it had not gone ahead, Turkey would be left alone to conduct search and rescue operations in the Aegean, an outcome he described as unacceptable.
He also argued that the project would provide work for the Helleni Aerospace Industry ‘for seven years’ and that the ultimate cost would drop to ‘300 million,’ although he offered few details on how that would happen.
http://www.thetoc.gr/eng/news/article/government-under-fire-over-500-mil...
Hey Europe:
When life gives you a few albatross to hang around your neck, learn to make albatross soup.
The Greek economy is cooked. If you reformed Greece's govt. and got rid of all the useless govt. jobs, patronage and overblown pensions, there would be no functioning economy left and the swirling debt and debt spiral would be complete. Running on one cylinder is fine for a weed whacker but not for a 4 cylinder economy you expect to drive somewhere.
The loansharks and Greek pols put Greece in a damned if you do, damned if you don't situation and N. Euro taxpayers get to save the banks and bond holders that caused the whole mess by sub-prime lending.
And why not? It worked so well in America with mortgage lending and bailouts for record profits.
"either the government or the pensions are now openly lying to the population"
they are both lying
and so are members of the "population"
lies to maintain the status quo until the riots break out and take it down
Why is Syriza putting the IMF ahead of its own people?
If Greece is broke then better pay the last euros to pensioners and govt workers than creditors. Greece IS broke, and this train wreck of a tragi-comedy has been going on for too long.
Syriza is a Trojan Horse. Meant to deliver Greece up to the Troika with pretend populism.
Tsipras is different because he doesn't wear a tie. He's punk rock!
Instead he is masterful at delivering his people to the banksters like all good "leftists" do.
Greeks do what Greeks do: Take it in the ass. Syriza is only different because they pretend *NOT* to like it.
The only difference is that Greek will surrender up everything of value and then still default. Useless. Leftists are just fucking useless. How can this gov't not fall?
Not ready for prime time.
The new greek government are properly following orders, nicely house-trained, behaving themselves like good boys and girls.