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Greece Abandons "Red Lines" As Troika Meets In Berlin To Craft "Deal"

Tyler Durden's picture




 

We’ve been saying for months that the troika’s ultimate goal in negotiations with Greek PM Alexis Tsipras is to use financial leverage to force Syriza into abandoning its campaign mandate, thus sending a strong message to the EU periphery’s other ascendant socialists that threatening to disprove the idea of ‘euro indissolubility’ is not a viable bargaining strategy when it comes to extracting austerity concessions from creditors. 

Over the past several days the political situation has come to a head with Tsipras expressing his extreme displeasure at the troika’s “coordinated leaks” and unwillingness to give even an inch on what the PM calls “absurd” demands.

Meanwhile, Syriza has splintered with the far-left faction demanding a return to the drachma and a default to the IMF. We’ve contended that Tsipras will not be willing to go that route and risk an economic meltdown that would likely see him lose power altogether. The more likely scenario, we have argued, is that Tsipras caves to the troika, compromises on the government’s ‘red lines’ (pension reform being the most critical) and risks a government reshuffle on the way to a third program, thus averting a euro exit and keeping Greece from descending into a drachma death spiral, even as the “solution” effectively strips the Greek people of their right to choose how they want to be governed — a tragically absurd outcome in what is the birthplace of democracy.

Sure enough, it appears as though this is precisely what will unfold over the coming weeks as Tsipras has now indicated he is willing to compromise on pension reform. Reuters has more:

Greek Prime Minister Alexis Tsipras is ready to discuss pension reforms in negotiations with international creditors over a cash-for-reforms deal, German newspaper Die Welt reported on Monday.

 

Labour and pension reforms are believed to be among the big sticking points with Athens.

 

Die Welt cited participants in the negotiations as saying the prime minister had signalled he was ready to discuss pension cuts and a higher retirement age.

 

The Greeks has not yet submitted a concrete proposal, the paper added in a preview of an article to run in its Tuesday print edition.

And with that it will be missioned accomplished for the troika. The Greeks will remain debt serfs, Germany will have made its point and sent a strong message to the rest of the EU periphery, and the IMF… well, that’s still up in the air because Christine Lagarde has made it abundantly clear that the Fund does not wish to participate in perpetuating this ponzi any further unless Greece’s EU debtors agree to a writedown of their Greek bonds. Largarde and Draghi reportedly met with Merkel and Hollande in Berlin today, perhaps sensing that the charade is finally coming to an end. 

Via Reuters again:

The chiefs of the European Central Bank and the International Monetary Funded headed to Berlin for talks late on Monday with the leaders of France and Germany on how to proceed with Greek debt negotiations.

 

EU officials said ECB chief Mario Draghi and Christine Lagarde of the IMF were joining the German and French leaders, and the president of the European Commission, with the aim of reaching a joint position on how to negotiate with Greece.

 

The unexpected development came after Greek Prime Minister Alexis Tsipras fired a broadside at international creditors that officials said bore little resemblance to his private talks with EU leaders.

Once again, here’s a flowchart which diagrams what comes next:

*  *  *

For those interested to know what these "absurd" demands from the troika are, we bring you the following from KeepTalkingGreece who has the story:

Creditors command and demand, Greece is willing but … some red lines cannot be set aside. Apart from that, creditors’ commands are anything but logical as their demands could be only described as crazy. Furthermore the creditors seem divided as to what they demand from Greece with the logical consequence that the negotiations talks have ended into a deadlock.

According to Greek media reports,

While the European Commissions wants austerity measures worth 4-5 billion euro for the second half of 2015 and the 2016, the International Monetary Fund raises the lot to 7 billion euro for 2016. The all-inclusive austerity package should include among others €2.7 billion cuts in pensions.

The Pensions Chapter is one of the thorns among the negotiation partners, and Greece would love to postpone it for after the provisional agreement with the creditors, call them: Institutions.

While it is not clear whether it is the IMF or the EC or both, it comes down to the command that

“Pensions should not be higher of 53% of the salary due to the financial situation of the social security funds.”

 

Pension for a civil servant (director, 37 years of work) should come down to €900 from €1,386 today after the pension cuts during the austerity years.

 

Pension for private sector – IKA insurer (37 years of work, 11,000 IKA stamps) and salary €2,300 should come down to €1,250 from €1,452 today after the austerity cuts. (examples* via here)

Of course, with the PSI in March 2012, Greece’s social security funds suffered a huge slap in their deposits in Greek bonds.

According to the Bank of Greece report of 2012, social security funds were holding Greek bonds with nominal value €18.7 billion euro. The PSI gave them a new look with a nice hair cut of 53.5%. Guess, how many billions euros were left behind.

If one adds the loss of contributions due to high unemployment, part-time jobs, uninsured jobs and the disappearance of full time jobs in the last 3-4 years, the estimations concerning the money available at the Greek social insurance funds are … priceless!

Another thorn in the negotiations is the Value Added Tax rates.

Creditors reportedly want Value Added Tax hikes in the utility bills, electricity and water charged with 23% V.A.T. from 13% now.

Do I hear you say that the austerity recipe imposed to Greece is wrong? You’re totally right.

But creditors insist on it and then wonder why the soufflé dramatically sinks once it comes out of the oven in Brussels.

*examples: the pensions issue is a huge labyrinth as full or reduced (early retirement) pension calculation depends on several criteria in addition to the 37 years +11,000 IKA-stamps scheme. There is no average and therefore there can be no average cuts.

Before the crisis, pension was 80% of the salary of the last 5 work years. Now it has come down to 60% of either last salary after the salary & wages sharp cuts or of the best salary. And creditors want it down to 53%! Go figure…

What is fact is that pensions in private sector sank at 26% in the last 3 years.

 

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Mon, 06/01/2015 - 16:52 | 6153080 Panic Mode
Panic Mode's picture

Pussy

Mon, 06/01/2015 - 17:06 | 6153111 Paveway IV
Paveway IV's picture

Fuck the Greek government and all the oligarchs that have been ass raping the Greeks.

Greek citizens have ZERO MORAL RESPONSIBILITY for the debt of their foreign corporation government.

All bets are OFF. Let the useless old Greek government fall. All hail the debt-free but broke NEW Greek government. The only legal money they have is the new taxes they collect - nothing else. All government debt anywhere on earth is illegal. Citizens are not responsible for it. I am not responsible for U.S. government debt - fuck you, oligarchs.

Mon, 06/01/2015 - 17:43 | 6153221 ZerOhead
ZerOhead's picture

"In the modern economy, most money takes the form of bank deposits. But how those bank deposits are created is often misunderstood: the principal way is through commercial banks making loans.

Whenever a bank makes a loan, it simultaneously creates a matching deposit in the borrower’s bank account, thereby creating new money."

Bank of England Quarterly Bulletin 2014 Q1 - qb14q1prereleasemoneycreation.pdf

 

They are actually going to hand the country over to bankers who created the debt out of thin air.

Bankers 666  Sheep 0

Mon, 06/01/2015 - 17:54 | 6153277 indygo55
indygo55's picture

What changed? Did they all of a sudden point a BIGGER gun at his head? DId they offer him a bigger bribe? Did they threaten his parents and well as his wife and kids? Really? I mean what could have possibly been thought up by now that was new? This is madness. 

Mon, 06/01/2015 - 18:53 | 6153453 phoolish
phoolish's picture

I guess they forgot about iceland.  Oh, did the Kriegsmarine and Luftwaffe flatten iceland?

Mon, 06/01/2015 - 21:01 | 6153839 Tom Servo
Tom Servo's picture

One thing I don't understand.  IMF loans are always super senior, and cannot be written off.  Says who?  Because they say so? LOL  Last time I checked, they don't have any armed forces ....

Mon, 06/01/2015 - 21:37 | 6153963 tarabel
tarabel's picture

 

 

Wealthy people do not carry guns themselves.

Mon, 06/01/2015 - 23:34 | 6154263 ThirteenthFloor
ThirteenthFloor's picture

And very few elected officials have a set of balls.

Mon, 06/01/2015 - 18:56 | 6153464 Parsecs Taxi
Parsecs Taxi's picture

Maybe it was just a scam from the beginning.

Mon, 06/01/2015 - 19:52 | 6153619 CPL
CPL's picture

Yes, the euro has been a scam since the beginning.

Mon, 06/01/2015 - 21:19 | 6153896 mvsjcl
mvsjcl's picture

Ghordie will be by to -1 you in just a bit.

Mon, 06/01/2015 - 22:31 | 6154112 CPL
CPL's picture

Good good, as long as he's consistent.  Might get worried otherwise.

Mon, 06/01/2015 - 21:31 | 6153938 mvsjcl
mvsjcl's picture

Dup.

Mon, 06/01/2015 - 19:04 | 6153477 Renfield
Renfield's picture

<<What changed?>>

Nothing changed. As usual. This is just more MSM (Reuters) spin direct from Schauble, in a transparent attempt to keep up the media pressure. Notice there is no information representing the Greek negotiators (as opposed to "media") here. Another No Newsday report saying "There's another Very Important Meeting coming up!" and OMG the pressure's really on them NOW! (Or in a few more days when they have a meeting to come up with a deal -- for sure and for real this time honest-to-gosh). In other words, it's propaganda. Maybe Tyler should just ask Schaubles' secretary to send him the same meeting schedule that goes to the MSM, so people can keep hyperventilating on Reuters' say-so. Reporting scheduled meetings as News now? Pathetic.

According to this MSM stuff, the Greeks are always always sweatin' b/c they gonna LOSE. But not Schauble, man, b/c he have a powerful dick and ECB sittin' pretty with nuthin' to lose. It's annoying to see this level of credulity, based on NO NEWS (as usual).

Surprised Tyler is still this credulous. Most of the posters here have much better propaganda antennae. Wake me up when there's something to report, instead of yet another damn meeting.

Mon, 06/01/2015 - 22:30 | 6154110 sumo
sumo's picture

 "This is just more MSM (Reuters) spin direct from Schauble, in a transparent attempt to keep up the media pressure.."

Well said. I logged in just to upvote.

To put it another way, this piece is just a small shipment from the media factory that manufactures consent.

Syriza hasn't caved in, so the Troika are still using an old sales tactic: "assume the sell"  - talk as if the punishing deal is inevitable, frame it as a done deal, so all the media carpet stains breathlessly report it as such (honorable exception: AEP of the UK Telegraph).

Tue, 06/02/2015 - 00:09 | 6154353 julian_n
julian_n's picture

The European press agrees with you - nothing has changed - so as you say Wolfie is spinning again!

Anyway, once Kerry is back in action I am sure he will see to it that Germany realises it needs to relax Greek loan terms to avoid Greece siding with Russia.

Tue, 06/02/2015 - 02:31 | 6154524 Pulq
Pulq's picture

Problem is that the German demands for austerity have been so inflexible and dogmatic in the past that now, even if in a flash of illumination they realized that their policy obliterates economies, based on, I don't know, all statistics of the past 7 years, it would be extremely hard to cave in. I'm not sure the Portuguese, Italians and Spaniards would take it very well if Germany went like "well yeah we imposed a destructive policy on you for the past 7 years... WOOPS! sorry gaiz xD, kthxbye". This is way more geopolitical than it is economical, unfortunately.

Wed, 06/03/2015 - 12:45 | 6159473 Michail Barmpas
Michail Barmpas's picture

You know what's wrong with the Germans Julian? They always underestimate the Greeks. They did it in WWII and they lost. Here is some evidence: 

 

Sir Robert Antony Eden, Minister of War and the Exterior of Britain 1940-1945, Prime Minister of Britain 1955-1957: 

"Regardless of what the future historians shall say, what we can say now, is that Greece gave Mussolini an unforgettable lesson, that she was the motive for the revolution in Yugoslavia, that she held the Germans in the mainland and in Crete for six weeks, that she upset the chronological order of all German High Command's plans and thus brought a general reversal of the entire course of the war and we won." (Paraphrased from a speech of his to the British parliament on 24/09/1942)

They do it now for a second time. You think Germans are so clever to win the Greeks? Well, I'll tell you, Germans may speak one language, perhaps two or three, or maybe four or five, but the Greeks understand every language. Here, like Russian for example: https://www.youtube.com/watch?v=OuGUCWc0Nqo

Mon, 06/01/2015 - 17:36 | 6153228 two hoots
two hoots's picture

Greece must face itself and change.  What was is no more.

Mon, 06/01/2015 - 19:52 | 6153620 chokeNpuke
chokeNpuke's picture

The Greeks must love a good ass fuckin..because the bankers are sticking it up Greece's ass once more...the bankers shoot and score...kick the can up the Greece's ass a little bit more.

Mon, 06/01/2015 - 20:13 | 6153670 GoldSilverBitcoinBug
GoldSilverBitcoinBug's picture

Indeed, you are not responsible for your government debts but have you voted ?

If yes, then you are responsible, you are responsible of the retards that you put in power and being an idiot yourself for believing their promise...

Democracy doesn't work, if it worked you will have no debt, a Gold Standard, no Free Shit Army and a guy like Ron Paul as president and the Constitution back.

Democracy (mob rule) never worked and will never work so I usually don't even bother to vote.

Hedge Accordingly.

Mon, 06/01/2015 - 23:28 | 6154252 Paveway IV
Paveway IV's picture

"...Indeed, you are not responsible for your government debts but have you voted ? If yes, then you are responsible..."

Bullshit. I've personally chosen to stop believing in that goddamn LIE. I am not responsible for debts without my personal signature. Fuck anyone and their convoluted logic about how I am responsible for the debts of a foreign corporation just because I participated (or did not participate) in their popularity contest. 

"...you are responsible of the retards that you put in power..."

Correction. The retards in power got there as a result of decades of bribes, a usurped voting process and corrupted justice. A process that started well before I was born. The only thing I am responsible for now is removing them from power and restoring the constitution

"...Democracy doesn't work, if it worked you will have no debt, a Gold Standard, no Free Shit Army and a guy like Ron Paul as president and the Constitution back..."

Fuck you and your academic definition of pure democracy. Go argue that on Reddit with the other knuckledraggers. Participatory democracy isn't an exclusive form of government anywhere, it's a part of an effective and fair government of a republic. Of course it doesn't work when a psychopathic, bottom and top third of the population tries to live off a relatively normal, moral middle third and all of them are uneducated and incapable of critical thought. Of course it doesn't work when a foreign corporation formed to do clerical work on behalf of a nation morphs into a super-class of oligarch rulers. That only proves a CORRUPTED democracy doesn't work. Gosh... ya think? 

"...Democracy (mob rule) never worked and will never work so I usually don't even bother to vote..."

You're reasoning is slightly skewed, but you have correctly observed on the futility of participating in a usurped voting process for an unrepresentative government, so forget everything I said above. Fuck the vote 2016 - let the oligarchs vote for themselves.

Tue, 06/02/2015 - 04:24 | 6154614 GoldSilverBitcoinBug
GoldSilverBitcoinBug's picture

What an emotional post bro.

You are the example of why democracy doesn't work (ideally only a constitutional regime with rights defined and can't be removed/modified via democratic (mob rule) or corrupted leader.

For the corrupted leader: all leader get corrupted and yet you still vote for them, then you are responsible: at least in a democracy you get what you fucking deserve.

Better to go Galt.

Mon, 06/01/2015 - 21:35 | 6153957 tarabel
tarabel's picture

 

 

I might be willing to concede that any Greek who has not profited from their "foreign corporation government" running up debts has no responsibility-- but I suspect that the gross number of such inhabitants of the Greek peninsula is very close to zero itself.

Everybody loves getting a check, especially if they don't have to work hard to obtain it.

Tue, 06/02/2015 - 00:11 | 6154326 Paveway IV
Paveway IV's picture

That fails the 'reasonable person' test, tarabel.

Some nobody production-line worker for the former Solyndra shouldn't be responsible for the actions of that criminal enterprise or its theft of taxpayer dollars EVEN THOUGH that production-line worker arguably unfairly enriched themselves for a period of time while working at Solyndra.

Government workers are not responsible for the debt of the government EVEN THOUGH they arguably unfairly enriched themsleves from that government while working for them.

Some disabled Greek that is legitimately collecting disability coverage is not responsible for where the money came from or how much they should get. An old government pensioner isn't the problem despite their proported benefit from fucked-up financial and social policy.

The average person is capable of distinguishing the meager excess benefits a resonable person obtains from the millions the oligarchs vacuum up as a result of those same policies. That's part of the scam: citizens getting a few crumbs of benefit while bearing ALL the responsibility to the tune of millions, while the oligarchs orchestrating the scam walk with their pockets full. Fuck that.

Greeks have ZERO MORAL RESPONSIBILITY to pay back a dime. Foreign banks imagined unlimited authority for the Greek government to borrow money when NO SUCH AUTHORITY EXISTED. The banks get fucked good and hard like they should. I'm sick of bankrolling their stupidity and greed. Any bank that fails from lending to any government gets absolutely no fucking sympathy from me. I'll party on the news of that bank's death and piss on their grave. 

As a side note, recognizing that U.S. government debt IS NOT MY MORAL RESPONSIBILITY is actually quite liberating. It makes you see the criminal banking enterprise in a whole different light. The closest thing we have to pitchforks and torches today is

"The U.S. government is a foreign corporation - I am an American citizen and AM NOT RESPONSIBLE FOR IT'S DEBT. Stop lending money to it because I have no moral obligation and no fucking intention of paying it back. If ANYONE loans money to the U.S. government - FUCK YOU, you are my enemy and deserve to lose every last God damn dime." 

Mon, 06/01/2015 - 17:42 | 6153254 HungryPorkChop
HungryPorkChop's picture

Everyone already knew the outcome.  This was nothing more than the U.S. Debt Limit Scare.  As long as the banks can push the CTRL ALT Print Button and Billion$ of Euro's or dollars are created out of thin air then you can bet you sweet arse' that Greece will get some type of deal.  This was nothin' but more drama for those who believe the media that Greece could really default. ha! ha!

The only way Greece could default would be to leave the Euro.  Then they could default which would be the equivelant of Argentina not paying its debt.  End of story folks.  So not sure why ZH and the others continue to print these stories which are a waste of time reading. Greece is the Grand Master of Can Kicking.  I fully expect we'll still be reading about a Greece default in another 3 to 5 years.  

Mon, 06/01/2015 - 17:59 | 6153288 zorba THE GREEK
zorba THE GREEK's picture

Alexis Tsipras knows what it means to be between a rock and a hard place.

Some of you here a ZH make light of what is going on in Greece, but the 

Greek people are no more responsible for what is happening to them than 

are all Euro nations, the USA, Great Briton and Japan. So pay attention to

their fate, because it is the fate of all of us.

Mon, 06/01/2015 - 20:28 | 6153707 HardAssets
HardAssets's picture

Zorba - " Greek people are no more responsible for what is happening to them than are all Euro nations, the USA, Great Britain and Japan. "

And this is why humanity is trapped in their own illusions; they never take responsibility for allowing the world to be as it is. They'll continue to childishly obey false 'authorities'. Theyll continue to fill their sons heads with garbage, so some will grow up as 'patriotic' soldiers and police who are manipulated to oppress their own families. The people provide the physical bodies to carry out their own enslavement.

They look for a 'Mommy' and 'Daddy' to protect them and provide for them. Many refuse to look at what's actually going on in the world. They remain children and they remain slaves.

Mon, 06/01/2015 - 20:53 | 6153802 asteroids
asteroids's picture

I've been saying since the second bailout, it was mathematically impossible for Greece to dig its way out. Default is inevitable. Greece should default but stick with the Euro. There WILL be pain, but get it over with. In a year or two, things will get better. That's how life works.

Mon, 06/01/2015 - 21:28 | 6153934 tarabel
tarabel's picture

 

 

Everything is always somebody else's fault.

The Greeks could choose to be honorably poor and free tomorrow, if they so desired.

Or they can choose to be the kept creatures they currently are and enjoy an undeserved and artificially-enhanced standard of living courtesy of the EU.

Hmmm, I wonder which one they are after?

Mon, 06/01/2015 - 16:53 | 6153086 cuttlefish
cuttlefish's picture

Get it over allready you pussy greeks for fuck sakes I am so sick of this drama ...

 

Mon, 06/01/2015 - 17:07 | 6153117 fockewulf190
fockewulf190's picture

Ironic isn´t it that the word "drama" originiated from Greece.  Unfortunately, this drama is no way near over.   It´s going to end up being long and tragic.

Mon, 06/01/2015 - 20:13 | 6153645 CPL
CPL's picture

Naw, played out like this last time as well, couple more steps and it starts.  People panic and all hell breaks loose.  Kikes fire the missles, automated dead man switches counter launch.  Gets very quiet and then ground-hog day March 2007.  All that's missing is NYC flooding and a monster storms off the Florida and California coast.

Anyone getting a sense of deja-vu like you've lived through this before?  lol!

Mon, 06/01/2015 - 21:14 | 6153879 Brooks_Orpington
Brooks_Orpington's picture

You, sir, are an assclown.

Mon, 06/01/2015 - 21:37 | 6153953 CPL
CPL's picture

Earth:  An exhibit in failure....how do you like it?  It's a best seller.  All this btw, not my issue and its not like anyone actually listens any ways.  Most of them are too busy polishing thrones, waiting for kings, hoarding bits of credit and covering their asses.  Most of them are barely cognizant of the situation, doubtful they ever will be and remain in the labyrinth.

Mon, 06/01/2015 - 16:58 | 6153093 HenryHall
HenryHall's picture

If true this is all the fault of KKE.

If true.

Mon, 06/01/2015 - 16:57 | 6153095 wendigo
wendigo's picture

It occured to me that while I used to care about shit, I've now reached the status of total cynicism. Is that a form of enlightenment, or did I just miss the point? 

Mon, 06/01/2015 - 17:12 | 6153147 gatorengineer
gatorengineer's picture

Enlightenment......  this is unfolding as its going to be the 2.0 social experiment with the Cyprus bail in being 1.0 (confiscation of assets).  A prelude to a 30%+ cut in social security here.  They are trialing the show on the road first.  Version 3.0 will be the attack on Private Pension (401k) plans.  4.0 will be the wealth tax.  Incrementalism at its best.... 

Mon, 06/01/2015 - 16:57 | 6153096 Consuelo
Consuelo's picture

They cannot let Greece fall into the hands of the Russians.   At least not that easily.

 

 

Mon, 06/01/2015 - 17:27 | 6153201 Bunga Bunga
Bunga Bunga's picture

Right, the Eurozone would be fucked three times. First a loss in 100bln+ to be explained to the taxpayer, it would push the Euro closer to a break-up and Putin would win again. T&V can just poker high.

Mon, 06/01/2015 - 21:29 | 6153909 tarabel
tarabel's picture

 

 

One Russian Empire already collapsed trying to maintain a cadre of economically-trashed dependencies that sucked it dry (drier).

As I have said before: Russia and China offer all sorts of moral support and promises of future help.

But the Greeks always fly home with empty pockets in real time.

If anyone truly wanted to "steal" the Greeks away from their current EU entanglements, it would have already happened.

Both Russia and China have serious economic problems on the home front and do not need the Old Man of the Sea perched on their shoulders.

Mon, 06/01/2015 - 16:58 | 6153097 pods
pods's picture

This is just painful now.

Greece will be asset stripped like roadkill by buzzards.  Then they will default.

Going to be a long summer in Greece.

This is just like playing monopoly, where one guy owns enough of the good properties to slowly strangle everyone else.  Except that he is now loaning the others money to keep them going around the board, each time racking up more and more debt, but telling them they can get back into the game.

pods

Mon, 06/01/2015 - 17:05 | 6153120 FrankieGoesToHo...
FrankieGoesToHollywood's picture

Monopoly is fun but is missing a essential element: Armies.  I dont always play board games, but when I do, I choose Risk.

Mon, 06/01/2015 - 21:01 | 6153823 bonin006
bonin006's picture

"The Bank never “goes broke.” If the Bank runs out of money, the
Banker may issue as much more as may be needed by writing on any
ordinary paper."

(I intended to reply to turnoffthewater below)

 

Mon, 06/01/2015 - 20:13 | 6153664 turnoffthewater
turnoffthewater's picture

In the Monopoly rules, if the bank runs out of money, they issue IOU's. How apropo.

Wed, 06/03/2015 - 11:19 | 6159112 Michail Barmpas
Michail Barmpas's picture

It is is going to be a very lovely summer in Greece and it has started already. To conceive this better, I suggest you may line to learn some Russia?: https://www.youtube.com/watch?v=OuGUCWc0Nqo

Mon, 06/01/2015 - 16:58 | 6153099 NoDebt
NoDebt's picture

Your pension is safe in the US, though.  That could never happen here.  Because you were "promised".  By a politician.  Who won't even be in office any more by the time you go to collect.

Mon, 06/01/2015 - 17:29 | 6153209 orez65
orez65's picture

"Your pension is safe in the U.S. ..."

Of course, specially our Social Security pensions!

See we have this "Social Security TRUST FUND" with about $4 TRILLION.

Except, well, that "money" was spent by the Federal Government.

But they did leave these IOU's called Treasury Bonds in the TRUST FUND!!!

Mon, 06/01/2015 - 17:02 | 6153110 Seasmoke
Seasmoke's picture

And the Greeks voted for this pussy and expected anything else ??

Mon, 06/01/2015 - 17:28 | 6153204 Fod
Fod's picture

Well, the alternative was fascists...

Mon, 06/01/2015 - 17:42 | 6153253 markar
markar's picture

They have fascism now

Wed, 06/03/2015 - 11:24 | 6159140 Michail Barmpas
Michail Barmpas's picture

Fascism? How come? I don't get it. You may wish to consider my friend that democracy is not only a privilege in your own country. SYRIZA is an elected government, and enjoys the full support of the people in Greece, how about that? By the way, do you know where is Greece in the map?

Mon, 06/01/2015 - 18:08 | 6153323 walküre
walküre's picture

Golden Dawn are not fascists. Not every Nationalist Party is automatically a fascist organisation. The downfall of all our nations are the international or multi national agencies and corporations which always put profits before people.

Don't expect me to wave a flag, any flag or show any loyalty, any loyalty

Tue, 06/02/2015 - 02:59 | 6154549 Fod
Fod's picture

New Democracy and Pasok, while in power, enforced a police state and ruled pretty much as fascists. KKE wants a dictatorship of the proletariat (at least in paper) and declare themselves ultra communists. And please, do not be an apologist for Golden Dawn, these guys go around beating gays and immigrants, the only thing they read is Hitler and are pretty much all cretins, so yes, they are fascists.

Mon, 06/01/2015 - 17:15 | 6153114 Kirk2NCC1701
Kirk2NCC1701's picture

The word Sodom needs a modern update, and should be replaced by Athens, IMO.  And the words for Serf, should be updated by Maidan, Kiev or Greek.

Ok, all joking and sarcasm aside... Greece and Kiev are Beta Templates for TPTB/NWO.  If the People do not rise up or even protest in numbers in Athens and Kiev, what do you think the odds are of them doing anything substantial anywhere else in the EU or USSA?

Exactly!  Z E R O.  Or damn close to it.  Hedge and plan accordingly.  The Sheeple of the West are... "shagged".

Mon, 06/01/2015 - 17:09 | 6153124 jarana
jarana's picture

How the fuck these bastards expect to get their money back from people who earns 900€ per month (the 60% that is not unemployed) with a 23% VAT?

Seriously. One thing is being evil. Another thing is being stupid. These fucking bastards don't even know how to run the simplest busyness on earth: USURY.

Maybe they are starting to believe their own lies about money being "free".

Unbelievable.

 

Mon, 06/01/2015 - 17:29 | 6153207 Bunga Bunga
Bunga Bunga's picture

Never. Government debt is meant to never be paid back, just to roll it over.

Mon, 06/01/2015 - 17:29 | 6153208 Fod
Fod's picture

And if you're under 26, 450€ per month 

Mon, 06/01/2015 - 20:44 | 6153764 HardAssets
HardAssets's picture

Their 'money' isn't what most people think it is.
Their 'money' is simply a tool of control, a tool for enslavement.

Some still seem to think its about 'economics' or 'finance'.
Really ?

When they can make their instrument to order the slaves up outta nothing, outta thin air ? The best thing (for the slave masters) is that the slaves think the 'money' has real value and that they voluntarily act to get it.
(Taxes are the method used to require that the slaves to use their 'money'.)

Mon, 06/01/2015 - 17:06 | 6153125 Kirk2NCC1701
Kirk2NCC1701's picture

And didn't I say just yesterday that nothing would happen?

Sun, 05/31/2015 - 11:52 | 6149247 Kirk2NCC1701  

As long as Greece is in NATO, "jack shit" will happen.  They will NEVER be allowed to leave, even if they default and join the AIIB or BRICS. 

NATO troops would be there in a jiffy, to... "Ensure Stability & Peace in the region"

Time to... "Move along, nothing to see..."

 

Mon, 06/01/2015 - 17:07 | 6153133 Wile-E-Coyote
Wile-E-Coyote's picture

I guess it will have to be "let them eat cake" moment for this to be over. The violence will be epic.

Mon, 06/01/2015 - 17:15 | 6153154 gatorengineer
gatorengineer's picture

I disagree, much of the economy is gray or black market, as it is here.  This is about a "few" old people starving, do you think their millenials are any different from ours?  Nary a sound will be heard after the first 72 hours.

Mon, 06/01/2015 - 17:15 | 6153155 Ghordius
Ghordius's picture

This article is very, very hard on Germany, painting the whole as a primarily hegemonistic move. Too simplistic and in many points wrong

Those pension reductions? Well, how much would they be hit by a devaluation of a new Drachma?

The real bone of contention is between Neo-Keynesians and the Hard Left. Note also how much the US is pressuring Germany to "do something and don't rock the boat of growth"

I ask: what do Greeks want? So far, the pro-EUR side is prevailing. This includes Communist pensioners, for example, as much as most of the business people

Mon, 06/01/2015 - 18:58 | 6153469 Parsecs Taxi
Parsecs Taxi's picture

They want their fur washed, but they don't want to get wet?

Wed, 06/03/2015 - 11:46 | 6159217 Michail Barmpas
Michail Barmpas's picture

You know what's the problem with you people? You talk too much but you never listen. You think that Greeks are stupid and your are clever? Well, in that case I would suggest you should start learning some Russian.... -https://www.youtube.com/watch?v=OuGUCWc0Nqo

Mon, 06/01/2015 - 17:17 | 6153161 youngman
youngman's picture

By August they are going to need another 50 billion...now who is going to write that check...yeah right...we are....and folks..that is when you lose faith in your currency..when you just print it up and give it away to deadbeats.

Mon, 06/01/2015 - 17:49 | 6153269 FrankDieter
FrankDieter's picture

I'd like to see Caitlyn Jenner get fucked in the ass by the squid.

Wed, 06/03/2015 - 11:29 | 6159164 Michail Barmpas
Michail Barmpas's picture

What a laugh ! You know what's the problem with you people? You always underestimate others. You think Greeks are stupid? Or that they have no alternatives? Greeks hold you by the neck right now my friend. To conceive the situation better, you may wish to start learning some Russian..... - https://www.youtube.com/watch?v=OuGUCWc0Nqo

Mon, 06/01/2015 - 17:18 | 6153166 Hughing
Hughing's picture

Tsipras campainged on fuck you. The Germans said fuck you, too, starve. How, if that is the political choice, could this end any way other than capitulation? Buy your Greek bonds. Squid did, I'll bet.

Mon, 06/01/2015 - 22:58 | 6154179 MarkGoldman
MarkGoldman's picture

Squid was there front and center helping the greeks cook their cooks for EU entry, so no doubt whatever they are buying now is well collateralized. 

Mon, 06/01/2015 - 17:20 | 6153175 Kirk2NCC1701
Kirk2NCC1701's picture

There's a new word in Greek for the word "Man with balls":  ICELANDER.

And there's a new food item on a Chinese Restaurant in Frankfurt:  "Chicken Greek Pao"

Wed, 06/03/2015 - 11:49 | 6159240 Michail Barmpas
Michail Barmpas's picture

You know what's the problem with you people? You talk too much but you never listen. You think that Greeks are stupid and your are clever? Well, in that case I would suggest you should start learning some Russian.... -https://www.youtube.com/watch?v=OuGUCWc0Nqo

Mon, 06/01/2015 - 17:26 | 6153196 falak pema
falak pema's picture

Mutti is trying to split Syriza and play a Fabian game against Yanis.

Game theory of who can break the other's will.

But in the final analysis, will Greece deliver even if they get a hair cut and if they have to admit to huge tax increases ?

Mon, 06/01/2015 - 17:32 | 6153215 Guentzburgh
Guentzburgh's picture

Another piece of nonsense, there is noo evidence Greek govt is abandoning red lines, just wishfull thinking or  in fact something more nasty, trying to create panic and discord in Greek society by propaganda 'news' to create a bank run thaat will topple the government !

ZH is 'proudly' part of this nasty misinformation campaign.

The truth is that the Greek govt is steadfast in upholdiing the red lines and that has worried Germany and their partner/puppets in france and other EU countries

Financial muscle is pulling the press strings ...  yawn!   

Mon, 06/01/2015 - 17:44 | 6153257 DeliciousSteak
DeliciousSteak's picture

The austerity measures don't sound that harsh, though whether cutting more at this point is a good course of action is arguable. Other EU members are currently in the process of implementing similar "harsh" measures, without the excessive drama of course. EU members are going all the way with austerity, not just Greeks.

Mon, 06/01/2015 - 18:08 | 6153272 kill switch
kill switch's picture

Can we forget abot fucking greece and move on already....Reporting  on this is a complete waste of time.

 

P.S.   I don't give a fuck what they do. It's nothing but a creeping delay..

Mon, 06/01/2015 - 18:03 | 6153300 hairball48
hairball48's picture

“Pensions should not be higher of 53% of the salary due to the financial situation of the social security funds.”

Pension for a civil servant (director, 37 years of work) should come down to €900 from €1,386 today after the pension cuts during the austerity years.

Pension for private sector – IKA insurer (37 years of work, 11,000 IKA stamps) and salary €2,300 should come down to €1,250 from €1,452 today after the austerity cuts. (examples* via here)

 

Do any of you actually believe the Greek labor unions, et al are going to simply take the above without a fight? And I'm talking a real blood in the streets fight complete with rioting and burning down of gov't buildings, etc.

Mon, 06/01/2015 - 18:09 | 6153328 Joebloinvestor
Joebloinvestor's picture

IMO any pension that is not 100% funded is a Ponzi scheme.

Mon, 06/01/2015 - 18:05 | 6153307 Colonel Klink
Colonel Klink's picture

Once a politician, always a whore.

Mon, 06/01/2015 - 18:31 | 6153384 Peter Pan
Peter Pan's picture

Politician to a prostitute: "I am really an honest politician."

Prostitute in reply: "And I am still a virgin."

Mon, 06/01/2015 - 18:08 | 6153318 Joebloinvestor
Joebloinvestor's picture

Greece will agree to anything and implement nothing.

Mon, 06/01/2015 - 18:09 | 6153327 i_call_you_my_base
i_call_you_my_base's picture

I'm sure the fact that Draghi devalued the hell out of the euro will help those pensioners too.

Mon, 06/01/2015 - 18:11 | 6153332 smacker
smacker's picture

As I wrote yesterday, the Eurozone = Hotel California.

God damn it, they're both even run by socialists ;-)

Mon, 06/01/2015 - 18:18 | 6153350 Peter Pan
Peter Pan's picture

Both sides are fools if they think that signatures on another document will lead to a viable solution.

Then again, a likely swooning of the gold price and a little more time will allow the wiser ones to accumulate some more gold insurance.

Mon, 06/01/2015 - 18:27 | 6153376 BoPeople
BoPeople's picture

My guess is that no country signing up for the Euro realized that they were permanently signing over their soul to Satan. I am sure they thought "what could be done, could be undone".

People of Greece. You are slaves. Bow down to your German masters.

Mon, 06/01/2015 - 18:31 | 6153383 Berspankme
Berspankme's picture

I knew Syriza would cave and I hope they get what they deserve. At some point you have to take the pain. That point is always better sooner than later

Wed, 06/03/2015 - 11:51 | 6159250 Michail Barmpas
Michail Barmpas's picture

You know what's the problem with you people? You talk too much but you never listen. You think that Greeks are stupid and your are clever? Well, in that case I would suggest you should start learning some Russian.... -https://www.youtube.com/watch?v=OuGUCWc0Nqo

Mon, 06/01/2015 - 18:47 | 6153432 q99x2
q99x2's picture

Guess this means that Greece isn't going to default eh?

Mon, 06/01/2015 - 18:49 | 6153439 Bazza McKenzie
Bazza McKenzie's picture

What's with this "drachma death spiral" nonsense?  Does ZH believe that if Greece leaves the euro the country will cease to exist, that unlike most countries in the world it cannot survive with its own currency?

If Tsipras caves, he splits his party and perhaps also his coalition.  He might get the "deal" through Parliament with the support of ND, but they certainly won't be supporting him after that.  So then comes the election to which Tsipras goes having lost a large chunk of his party and campaigning on how great he has been junking the policies upon which he was elected and which still have huge support.  Hardly a winning political strategy -- though if one is bought off and intends to flit off to a more hospitable environment it makes sense.

Mon, 06/01/2015 - 19:06 | 6153442 Renfield
Renfield's picture

Another ZH article based almost completely on 'information' from REUTERS, yet again, and as usual, NONE from the Greek side. You get a "1" for once again showing all the skepticism of an elderly teevee disciple.

You are aware, Tyler, that REUTERS is MSM, and gets its feed pretty much direct from Schauble's ass? And that the Greeks have a general pattern now of refuting or disputing these about a day later. How many of these Troika-inspired reports have you posted, only to post another one a day later when the Greeks issue some kind of rebuttal? Your reliance on MSM sources is making your analysis swing up and down like a toilet seat on a fair day.

Most of the Hedge stuff is great, but this Greek nonsense is pure MSM, and if I want that, I'll buy an idiot box and tune in like the rest of the sheeple. If you're going to analyse, you need information from TWO sides to do so effectively, and you should analyse BOTH sides of risk, since -- news flash -- BOTH sides have a lot to lose.

Therefore, I'll believe this when I hear it from the Greeks AS WELL, and not just the corporate propaganda shills OR the Troika (who also have everything to lose - not that you'd know it from these reports - and whose only real power is in its rapid and constant No News press). And yet another scheduled meeting frankly isn't news, shouldn't make anyone here even look up from their coffee. GIGO, so this one-sided Reuters info and therefore the 'analysis' are rubbish.

Mon, 06/01/2015 - 20:15 | 6153673 jtg
jtg's picture

Good sanity check on a lot of reactions here. I think there is a good possibility the Greece will leave the Euro and look East. The Greeks will again be an inspiration to us all.

Mon, 06/01/2015 - 18:51 | 6153445 dag
dag's picture

The Greeks have to have the stupidest government on the planet. 

If this government survives, the Greek people deserve what they get.

Wed, 06/03/2015 - 12:31 | 6159406 Michail Barmpas
Michail Barmpas's picture

You know what's the problem with you people? You always underestimate the Greeks, yet the Greeks know this well. You speak one language, perhaps two or three, or maybe four or five, but the Greeks speak every language. Well in that case you may also consider learning some Russian:https://www.youtube.com/watch?v=OuGUCWc0Nqo

Mon, 06/01/2015 - 18:58 | 6153471 f16hoser
f16hoser's picture

Yep. Just like I said. Tsipras is an Empty suit.

Mon, 06/01/2015 - 19:00 | 6153478 fallin_knife
fallin_knife's picture

The Greeks are completely "done" if they agree to this, after all of the threats that they have made. The government's credability will be even further below zero than it is currently. Tsipras would be acting with the same sort of fatalism as the Jews did when they passively gave in to the Germans under Hitler. If he simply rolls over and gives up, the Greeks completely deserve what they will get - all of their precious heritage and culture will be sold at auction to German companies and the formerly proud Greek people will be nothing more than tenant farmers on Germany's estate.

Mon, 06/01/2015 - 19:09 | 6153497 22winmag
22winmag's picture

Don't blame me.

 

I didn't vote for them!

 

Roughly translated from a Greek bumpersticker.

Mon, 06/01/2015 - 19:11 | 6153509 walküre
walküre's picture

Don't let Berlin be your Versailles....

Mon, 06/01/2015 - 19:17 | 6153524 kchrisc
kchrisc's picture

Just more theater.

Zion won't let their Greek estate leave, and the Greek puppets know this. A kind of "Zionist standoff."

Liberty is a demand. Tyranny is submission..

 

Poor Greeks need to get more weapons.

Mon, 06/01/2015 - 19:27 | 6153549 williambanzai7
williambanzai7's picture

We have achieved peace with honor. Dr K

Mon, 06/01/2015 - 19:37 | 6153575 TheGreatRecovery
TheGreatRecovery's picture

This is not Sparta!

Mon, 06/01/2015 - 20:12 | 6153666 jtg
jtg's picture

This is just another step toward the breakout of a new period of revolution in the West. It will be like the revolutionary ferver of the late 1800's to early 1900's. The US has contributed to it in Europe through the Ukraine backdoor by energizing the fascist/nazi groups there. Brussels is doing its part in Greece and heating up Spain.

The people can only be bled so much then all hell will be let loose. Bring on the ropes and lamp posts for the elites.

Mon, 06/01/2015 - 22:21 | 6154084 David Wooten
David Wooten's picture

"The more likely scenario, we have argued, is that Tsipras caves to the troika, compromises on the government’s ‘red lines’ (pension reform being the most critical) and risks a government reshuffle on the way"

Don't know who 'we' is, but I don't buy the cave-in prediction.  Tsipras would be wiser to negotiate a temporary deal and conduct a popular referendum - drachma/default or euro/austerity.  However, the referendum goes, Tsipras and his party would be more immune to blame from the outcome.

Caving in without a referendum could not possibly benefit Tsipras or his party.

Mon, 06/01/2015 - 22:36 | 6154117 Sauerkraut-Opinion
Sauerkraut-Opinion's picture

"What is fact is that pensions in private sector sank at 26% in the last 3 years."

 

...after it went up from 2000-2008 more than 200 percent? 

 

It's ridiculous - why should the average pension in that corrupt olivary-state significant higher and the retirement age significant lower than in Germany or any other EMU-member like Slovakia o Lithunia paying on balance 100 percent of Greek pensions? Same question is to be posed in comparism to many Eastern or North-Eastern EMU-members. 

And this comparism are still leaking: Because 57% of German civils (mostly lower income groups) have to pay monthly rent for accommodation (Greece 20%?), significant more for extra charges like electricity and heating (...sunny Greece....). They pay insurances for their cars, they pay taxes, they pay for refugees, Sinti, Roma, Greeks....meanwhile Mr. Tsirpas is cancelling private debts of Greek civils at (...from which money...) bailouted banks like Pireaus-Bank up to 20.000€ etc...etc...

 

Greece should return to own cash responsibilit outside the Euro. As fast as possible.

 

 

 

 

Mon, 06/01/2015 - 22:33 | 6154122 y.detor
y.detor's picture

Greetings from Greece! In general I agree with the article prediction. But let me remind the writer that the Greek goverment surrendered at the 20th of February 2015 to the "Troika". That day they sighned an agreement accepting all dept as LEGAL and promissed to pay IN FULL in the future. The Greek people who voted for hard negotiations and stopping austerity were betrayed only 25 days after the elections! So I realy think everything is public relations after that. Of course it is most likely this goverment will fall in a few days or weeks but a new one will be even more conservative and will pass the new big IMF loan (45 billion euro) after September. 

For the people this means 5 billion euro new taxes for 2015. And after September new cuts to salaries and pensions, even most likely a second internal currency 50% undervalued.

The revolution will not come from Greece if anyone hopes for that, because we have a very old population and most of them want the country to keep getting foreign loans and pay them their pensions. Everyone else just pray that old people keep getting pensions because without them everyone here would die of poverty.Right now only pensions are supporting the whole population (milions of unemployed younger people).

And a final point about our "friends" the German goverment: if Greece defaulted and went out of eurozone as it should, a small 1% only increase in interest rates would be unavoidable for German banks and would cost Germany 75 billion euro per year! So they will be very happy to spend a few billions to keep us in a "zomby" state.Thats the situation inside our nice EU at the moment!

 

 

Tue, 06/02/2015 - 00:09 | 6154341 Joe A
Joe A's picture

Welcome to ZH. We need more news from Greek in Greece :-)

Don't mind the likes of Wolfrl and Sauerkraut. They are just Germans ZH members with a superiority complex who fail to understand that the bailout of Greece was in fact a bailout of German banks that made bad investments (not to mention all the bribing that the likes of Siemens did in order to sell their stuff) and that the EU taxpayer has to pick up the bill in order to bail out these corrupt Germans banks. It is rather ironic that the country that destroyed the continent twice in a span of 40 years is now running the show in Europe thanks to their rather clever strategy of flooding Europe with their cheap Euro. The other EU countries scared of the 'never again' scenario are dancing to their tune.

Anyway, Tsipras will face mutiny from this far left fraction when he crosses his red lines so his government will most likely fall. We'll need to see how the Greek people will vote then.

Tue, 06/02/2015 - 01:51 | 6154489 cwsuisse
cwsuisse's picture

Unfortunately you are right. The likely outcome will render Greece incapable of improving and the debt will remain unpayable. 

Thu, 06/04/2015 - 10:46 | 6162907 Fod
Fod's picture

Also, don't forget that Greece defaulting will supposedly trigger the CDS's, and shit will really hit the fan then.

Tue, 06/02/2015 - 01:15 | 6154451 Sanity Bear
Sanity Bear's picture

The Greeks will vote for Golden Dawn next, if they feel they must to retain agency.

Tue, 06/02/2015 - 02:02 | 6154503 robertocarlos
robertocarlos's picture

If we're all gonna be commies shouldn't we all get the same govt pensions?

Tue, 06/02/2015 - 02:34 | 6154525 poldark
poldark's picture

If Greece sells all its assets to pay off its creditors it will no longer be a country. The people will be slaves of the ECB.

Thu, 06/11/2015 - 20:00 | 6188400 Sauerkraut-Opinion
Sauerkraut-Opinion's picture

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