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Greece Will Default On June 5 Without Deal, IMF Leaks
Another week came and went with no breakthrough in negotiations between Greece and its creditors. The IMF is now fed up and has reportedly refused to be a part of any new bailout program for Greece, after Athens drew down its SDR reserves to makes its latest payment to the Fund. That money will now need to be repaid and in a move that surely marks the new gold standard for absurd circular funding schemes, Greece will likely look to use the next tranche of IMF money to payback its IMF SDR reserve which it tapped to pay the IMF. The country’s public sector employees live in limbo, not knowing from one week to the next whether they will be paid and commuters are now subjected to a 50 second looped highlight reel of the Nazi occupation meant to rally the country behind the government’s quarter trillion euro war reparations claim (they might as well just ask for a 'gagillion') on Germany which has now become the symbol of tyranny and debt servitude for many Greek citizens.
Given the situation, one would be inclined to think that Alexis Tsipras would be falling all over himself to cut a deal with creditors because while giving up on campaign promises to voters isn’t ideal, it’s better than going down in history as the PM who sent the country careening into a drachma death spiral, and besides, giving up on campaign promises is something most politicians do all the time (it’s a job requirement for the US presidency). Alas we were back to the now ubiquitous ‘red line’ rhetoric on Friday as Tsipras continued to employ the “tell EU officials one thing behind close doors and tell the public the exact opposite a day later” negotiating technique. Here’s more from Bloomberg:
Greece won’t cross its red lines in negotiations with international creditors just because time is pressing to close a deal, Prime Minister Alexis Tsipras said.
“Those who think that our red lines will fade as time goes on would do well to forget it,” Tsipras said at a conference in Athens late Friday. “I want to assure the Greek people that there’s no way the government will back down on the issue of pension and wage cuts,” he said. “A deal must be reached but it must be mutually beneficial.”
Europe is once again set to take the stalled negotiations down to the wire as it now appears the next serious round of talks will come in Riga (the site of an epic Varoufakis meltdown that saw the FinMin tweeting out melodramatic FDR quotes after he was forced to have dinner by himself while his EU counterparts attended a gala) when Tsipras will try to close a deal by the end of the month.
Tsipras will address the standoff in bailout negotiations on the sidelines of a meeting of European Union leaders to be held May 21-22 in Riga, Latvia, according to a Greek government official who asked not to be identified as the diplomacy is not public.
If a deal isn’t struck by the end of May, it is truly game over. Here’s the ECB’s Yves Mersch:
“We are in an end game in Greece where the situation is grave. This situation is not tenable. There has been an accord between Europe and Greece to go through a program. This hasn’t been the case since December last year, because the new government said it doesn’t want to have anything to do with the program. But then they can’t demand money that was attached to that program either. In the meantime, they haven’t managed to bring other measures to the table that could lead to the same goal as foreseen in the first program. Greece is convinced it can play along the line of other rules than” the other 18 euro-area members.”
Despite the obviously dire circumstances, the Syriza government still insists it will somehow scrape together cash to meet its obligations...
“Greece Will Pay Wages, Pensions, Varoufakis Tells Skai TV”
...while EU officials (who one imagines are at this point completely amazed at how obtuse the Greek government has proven to be) are left with no option but to remind Greece that Brussels is still waiting on a list of reforms…
“Dombrovskis Reminds Greece to Submit Reform List, Bild Reports”
….and at the end of the day, here is the reality (via Bloomberg)…
"Greece won’t be able to make IMF repayments, beginning with a June 5 payment, unless an agreement is reached with international partners, U.K.’s Channel 4 reports, citing a leaked IMF memo dated May 14."
* * *
As a reminder, here is the IMF procedure for a default and a matrix which outlines what a missed IMF payment would mean in terms of accelerated payment rights for Greece's other creditors:
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JUNE 5th? This has been going on for SIX goddam MONTHS!
DEFAULT ALREADY YOU ECONOMIC PUSSIES!!!
Begins to sound like a braying donkey.
Greece won't default. You can stop the blaring, honking titles.
Wake me up when something really happens, like Greece joining the BRICS or Tsipras signing something with Gazprom. Whatever will be real news.
There will be a deal. The market will rally 1,000pts on the deal. Only to need another deal in a few months. Which once again the markets will rally another 1000pts. We have seen this show before.
nothing wrong with defaulting on odious debt.
and all debt arising out of loans made of money created out of thin air by said loan are per se odious.
exchanging years of productive labor to pay back - nothing. it is literally slavery.
+1.
Greece should max out her IMF credit line and then default. The IMF, in cohort with the World Bank and some Wall St players (e.g. Goldman Sach) has been a big source of economic sabotages, if not outright assassinations.
Don't let the scammers get one more penny.
Better deals can be found elsewhere, especially Russia and China.
THAT DOES NOT MEAN ANYTHING - OF COURSE IF GREECE HAS NO MONEY NO PAYMENT BUT DOES NOT MEAN DEFAULT YOUR PRATS...POINTLESS EXERCISE WRTTING ABOUT GREECE DEFAULT -- GREECE WILL NEVER DEFAULT STUPID SQUIDS
Jump you fuckers!
One might well wonder, where is all Tsipras's bravado and confidence coming from? His countriy's cash reserves are almost exhausted, there is no sign of its creditors being ready to accept his "red lines," further huge outgoings are due very soon, and most of the population want to remain in the Euro; yet there he still is, beating the same drum, not giving a significant inch. Well, the answer is simple; one thing that will not change is the strategic position of Greece on the world map, and he knows its importance to world powers dwarfs its debt crisis into insignificance. Regardless of whether Russia can or would bail Greece out, very idea that Greece could turn its back on Europe and invite the Russian fleet into Aegean sea ports is enough to make the world's directors reach for their cheque books and turn a blind eye to a Greek default. Of course that would be a radical move, threatening to upset the world order; but Tsipras has a capital R branded on his forehead.
It's not that important.
If you look at a map, you might notice that Russia cannot get to the Aegean without passing through the Dardanelles, i.e. NATO-member Turkey. Sure, Greek basing would be useful, just as is Syrian basing a bit to the East, but it's not a game-changer. It would in no way change the basic balance of power in Europe between NATO and Russia. I won't pretend to know exactly how much the Russian government would be willing to pay for basing rights, but I seriously doubt it would be enough to make a dent in Greece's economic problems.
Am I stuck a time loop ?
How many THOUSANDS of times must we see the SAME FN HEADLINE ??
I propose a ban on all this Greece shit until something has actually . . . uh - i don't know . . . happenED ??
So this one date is coming up and unless yadda yadda yadda Greece will default
Oooh Oooh Oooh I got a snorgtee ad back. Maybe the long lost camel toe will come back too.
Yawn. Greece going to default in [insert time frame of choice].
If Greece defaults....will the 10 year finally go negative in the U.S.?
it's already negative if you factor in real inflation / devaluation.
Then they'll get a deal.
Next.
Those meeting must be a sight to see, "Here's Greece in your eye"
...and, the latest strategy is so tired - death by a thousand cuts.
No Grexit !
Because NATO forbits it.
Obama says to EU vassals: "no Grexit !"
This article is very simple minded, add to that the addition of Mass media dumb and crude propaganda as evidence and what you have is a picture of linda lovelace (deepthroat).
Greece is playing a straight forward game (think game theory) , it necessitates that the opponent knows your exact position (red lines) from which you cannot move without causing disaster for both parties.
Agreement will be last minute, assuming a rational opponent the outcome is guaranteed.
It is given the EU and Germany have more than Greece to lose , certainly not less.
Why write articles without content Tyler?
DOW and S&P will be up 5% tomorrow on news of an agreement to bundle the payments until the end of June. It will be called a "comprehensive agreement"