Greece, Troika Submit Conflicting Eleventh Hour Deal Proposals

Tyler Durden's picture

On Monday evening, it appeared as though things had finally, after five arduous months of negotiations, come to a head in Greece’s standoff with the IMF and EU creditors. Prime Minister Alexis Tsipras’ penned a lengthy op-ed over the weekend which seemed to indicate that the Greeks were at the end of their rope. 

On the heels of Tsipras’ tirade, French President Francois Hollande, German Chancellor Angela Merkel, ECB chief Mario Draghi, and European Commission President Jean-Claude Juncker convened an emergency meeting in Berlin on Monday and Die Welt said Tsipras was apparently ready to discuss pension reform, a sticking point in talks thus far. 

Tsipras apparently submitted what he called a “realistic” final proposal ahead of the meeting. 

Here's more color from Bloomberg...

The brinkmanship over Greece’s future intensified after Prime Minister Alexis Tsipras said his government submitted a new proposal aimed at breaking the stalemate just as creditors set about finalizing theirs.

Tsipras is waiting for European leaders to show their hand after they held top-level talks in Berlin on

 

Monday night aimed at hatching a plan to unlock funds and avoid the country defaulting. The goal of the meeting was to hammer out an offer from creditor institutions that Greece could consider in coming days, according to two people familiar with the plan. The Greek government said it hadn’t received any draft agreement.

 

“After submitting a complete proposal for a deal last night to institutions, we are not waiting for them to submit their own plan back to us,” Tsipras told reporters on Tuesday. “Greece is the one that submits the plan"...

 

Representatives from the creditor institutions were said to be wrapping up their proposal, two people familiar with the matter said. It was still unclear whether it would allow for modifications, one of the people said.

...and two rather ominous soundbites from Tsipras:

  • TSIPRAS SAYS GREEKS KNOW NEXT DAY WILL BE HARD FOR GREECE
  • TSIPRAS SAYS GREECE WILLING TO MAKE TOUGH COMPROMISES

The PM probably meant “next day” metaphorically, but earlier this morning, Bloomberg, citing two people familiar with the matter, reported that “representatives from creditor institutions [are] said to be wrapping up a proposal to end [the] impasse on Greek bailout talks.”

Sure enough, rumors are now hitting the wires that Die Welt — the same Die Welt who last night reported that Greece may be ready to cross its “red lines” — is out saying that an EU official has indicated the troika has now reached an agreement on a deal. 

WSJ is running something similar and the bottom line seems to be that, fed up Syriza's unwillingness to concede its election mandate, the troika will now write the agreement for Greece and Tsipras can either sign it or not. Apparently, the IMF has scaled back its demands for EU creditor writedowns (another loss for Athens) but remains skeptical of the entire undertaking.

Via WSJ:

Greece’s creditors have reached a consensus on the terms of a proposed deal to put to the Greek government, according to two people familiar with the talks.

 

Officials representing European institutions and the International Monetary Fund on Tuesday morning completed the draft of an agreement to unlock bailout aid for Greece, after key European and IMF leaders met in Berlin late Monday to overcome differences between Greece’s creditors, they said.

 

Eurozone governments and the IMF have agreed to press Greece for far-reaching economic overhauls, while the IMF has softened its insistence that Europe offer explicit commitments to relieve some of Greece’s debt burden, the people said.

 

Greece’s high debt remains a contentious issue in the background between the IMF and European lenders, led by Germany, but is not holding up the creditors’ proposal to Greece. IMF head Christine Lagarde warned at the Berlin meeting that debt restructuring will become necessary if Greece doesn’t enact thorough economic overhauls that improve its budget balance and lift its growth trajectory, these people said.

 

The creditors’ proposal for an agreement is expected to be put to Greece’s government soon. Greek Prime Minister Alexis Tsipras is expected to face politically explosive demands for tough reforms of Greece’s pension system, labor laws and other areas, as well as creditors’ insistence on painful budget measures to ensure that Greece runs a fiscal surplus before interest.

 

Greece’s creditors have opted to write a draft agreement for Mr. Tsipras to accept after months of negotiations with Greek officials made only slow progress.

 

Creditors admit that Mr. Tsipras could face huge political difficulties if and when he asks his ruling left-wing Syriza party to accept a tough deal.

In other words, Greeks should be prepared to see some of Syriza's campaign promises compromised in the coming days and weeks. What that will mean for the shape of the government remains to be seen, but one thing seems certain, some manner of political reshuffle or upheaval is in the cards.

 

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NoDebt's picture

I think there's going to be a deal.  I know, I know, save the down-arrows.  But I think there's going to be an epic can-kicking deal comes out of this.

Gief Gold Plox's picture

Whatever it takes to maintain the status quo for one more month, week, day...

VinceFostersGhost's picture

 

 

Shaming the Germans for war crimes is worth another go I'm thinking.

Cognitive Dissonance's picture

The thing about bluffing is one must be ready to carry out the bluff. Otherwise when playing someone of equal or greater skill you find yourself in worse shape than if you just conceded at the start. The golden rule is to never bluff about something you aren't willing to accept when, and if, all the cards are finally laid down.

Wolferl's picture

Throw those pathetic Greeks out of Europe already.

SickDollar's picture

pathetic?? you must be a brainwashed german who believes in the euro lol

Greece was fucked and then  bailout to save the german banks not to save the greeks you moron

 

Brazen Heist's picture

Don't interrupt him....he's on his usual roll of stubborn monotonicity.

Maybe he can complain to Frau instead for helping to kick the can down the road again....till the next bailout.

PartysOver's picture

Any type of Greece deal, even a little can kicking, will send the Algo's batshiat crazy.  I am expecting monster volatility to the upside.

SickDollar's picture

after WWII the elite erased the German debt which help them to become what they are

 besides make no mistake about it

GERMANY is a colony of the US ( every time I go there i see how our  uneducated boys (military) do damage to your countries )

Wolferl's picture

Most of those 40.000, as you say "uneducated US boys" are doing a great job here in Germany protecting us. Damage to our countries? Not that much, because they are contained in two spots here in Germany around Ramstein and in Grafenwöhr, areas whre they cannot make much damage. And no, Germany is not a US colony, but a vassal state of the US empire. Big difference. Made us the winners of the cold war.

SickDollar's picture

You are our bitch period , I dont care how you suger it

 

Headbanger's picture

What fucking difference does a deal it make anyway when Greece can never pay back anything no matter how much they cut spending.

Cognitive Dissonance's picture

As with any Ponzi it's all about the illusion and the (temporary) confidence that illusion will inspire.

Professor Fate's picture

Not a snowball's chance in hell of ever repaying the debt....but then...neither can we.  Greece is just a small sample of the global banker ponzi based on worthless currencies and lies.

Fate the Magnificent
"Push the Button, Max" 

Oldwood's picture

Of course there will be a deal. This has all been a public dramatization of a deal. Default triggers far too much mayhem and uncertainty and if there is a theme, it is about control, the power of the EU. There is no money and there never has been. The debts will not be repaid...they were never going to be repaid. This is about surrendering sovereignty of the individual countries to the central one. Perverting democratic action to support tyranny....for survival. Did we not notice the threats of yesterday suggesting a "change" in government might be required?

Submit or perish. The same message used from the beginning of time. Ultimately the rights and future of the people are of as much consideration in this as are cattle's to the farmer.

Felino De Gattis's picture

"Submit or perish"? Do you have a clue of what happens when a U.S. state runs a continuous budgetary deficit? Or do you think that the Federal Government jumps in with billion of dollars for nothing? Look at how e.g. the New York crisis of the 1970s was handled. Alternatively, consider the fate of Newfoundland and Labrador, which had to give up their independence and merge into Canada in the 1930s because they could not borrow any more money. On the other hand, the Samaras Government had been free to choose how to get back to primary surplus and missed the chance of a socially sustainable reform plan by avoiding to fight corruption and tax evasion, which drained 107% of Greece's BIP between 2003 and 2011, and was the reform the EU mostly insisted on. In exchange, Greece got from the EU about 200 billions € loans, most of which will have to be repayed in 30 years, meaning that its debt service is better than that of some of its net creditors, e.g. Italy, and its new Government can say in public conferences that the EU is "a structurally rotten committee". "Submit or perish"? WTF, "submit or perish"??? I tell you what: as a EZ citizen, I wish Greece could be handled by a EZ Government (which unfortunately does not exist) just as the U.S. Government would handle a U.S. State in a similar case.

Wild Theories's picture

what's one way to capitalize on the situation?

buy NBG on the NYSE

 

Yes, it's the national bank of Greece, and yes, it's on the NY stock exchange.

justinius1969's picture

haha i am afraid not

*DIJSSELBLOEM SAYS CREDITORS STILL FAR FROM A DEAL WITH GREECE - bbg
let the farce continue...

Blopper's picture

There will be NO GREXIT ever, as I've said many times before.

gatorengineer's picture

There will be no CDS triggering event.  Fixed it for ya.  This stopped being about Greece a long time ago

Arius.'s picture
Arius. (not verified) gatorengineer Jun 2, 2015 7:42 AM

it was never about Greece to start with ...

doubledutch's picture

Sorry,there will be a Grexit and most probably soon,because the German voters are against more financial help.

doubledutch's picture

Sorry,there will be a Grexit and most probably soon,because the German voters are against more financial help.

doubledutch's picture

Sorry,there will be a Grexit and most probably soon,because the German voters are against more financial help.

overmedicatedundersexed's picture

as long as debt holders do not suffer, the deal will be made..any haircuts will be microscopic however austerity will become suffering for the common folks..the kings of the world cry for you greece.

sudzee's picture

Troika sure spending a lot of time and effort in trying to turn a total loss into  a face saving win. Greece is in complete control. 

 

PIIGS can fly.

yogibear's picture

Troika = Euro leeches

fukidontknow's picture

The time has come for the creditors to be f#*cked Greek style -

and if they're lucky to be paid in drachma.

VinceFostersGhost's picture

 

 

Time for an Icelander revolt...with cops and handcuffs.

 

The full Monte.

 

I'm assuming they have jail cells for bankers in Greece.

Colonel Klink's picture

I'm assuming they have burial plots for bankers in Greece?

FIFY

Seasmoke's picture

Agree to it. Get the money. And then don't do anything you agreed to. Simple !!

gatorengineer's picture

You mean like they have the last three times?

youngman's picture

That is exactly what the Greeks will do......and then come begging in another month...but they speak like they control the circus...lol....they are broke and have to borrow from their mother....lol

Panic Mode's picture

All I know is both sides will claim victory. That's what politicians do.

Ted Baker's picture

Let me spill the beans for you --> plan is to have a new gov before year end

mcbond's picture

Greece's international creditors are close to completing a draft of an aid agreement to present to the Greek government, a source close to the talks told Reuters on Tuesday. "We are almost done,"

BANKRUOT?

http://tersee.com/#!q=greece&t=text

yogibear's picture

Groundhog day. 

Oh the drama, before the Eurocrats buckle in and bailout.

Just print. Always the bankster solution.

 

Mr_Rog's picture

This is how it's going to get down:  Aggreement will be met and most propably a general election or refferndum, to seal the deal.

Now, what agreement that might entail? God knows, but hopefully to be beneficiary to  Greece.

The reality is that the EU is breaking apart right infront of their eyes and in order to save the project from total collapse. You have to ''to give in'' to their requests. 

gatorengineer's picture

Strange isnt it that Italy ans Spain arent at the table?  They know those two will be knocking next... perhaps after portugal.  Any haircut I believe still hast to get passed by the parliments so that could be interesting.

Mr_Rog's picture

Greece took the courage and stood up against Germany. According to the deal reached with creditors, next in line is Spain and Italy to cut a better deal. The only sollution right now, is to make a suit for each of these states according to their specifications. Its the only solution to keep the EU project alive.

Mr_Rog's picture

Greece took the courage and stood up against Germany. According to the deal reached with creditors, next in line is Spain and Italy to cut a better deal. The only sollution right now, is to make a suit for each of these states according to their specifications. Its the only solution to keep the EU project alive.

gatorengineer's picture

Troika agrees to between 50 and 100 Billion in writedowns, Greece agrees to reforms.  Greece fails to implement again, can sucessfully kicked 18 months or so.  Rinse and repeat.  Been sayin this for a long time.  It will be interesting to see how much the IMF (US taxpayer eats).

wildbad's picture

hurry the goddamned drachma up for gods sake.  greece will be "on sale" for tourists.  save the summer, save the year.  fuck the Eurocrats and their 'blood from a stone' policies.ICELAND ICELAND ICELAND ICELAND ICELAND ...

jarana's picture

If I were in the Troika position, I would have let Greeks think they are wining time, but really wining it for me, preparing a backdoor solution that appears to the public as Greece has been bailed out, in order to avoid political responsabilities.

A plan like that would have been developed like in the past 5 months and would start with something like these news.

nathan1234's picture

Using apt American English of Hilary Clinton & Victoria Nuland and Charlie Hebido incident

I am Greek

Fcuk You - Troika.

 

Colonel Klink's picture

They say the pen is mightier than the sword.  This whole farce just goes to prove it.

The entire population of Greece (save for a few politicians/bankers) have been robbed at the end of one.

CNBCrap's picture

Regardless of who is whose bitch, what makes you think the US gives a shit about Greece?

Joebloinvestor's picture

As I have said before, call it for what it is, CHARITY.

Any money lent will never be repaid.

Greece will not fix its' broken and corrupt system.

Greece, the lamprey eel of the EU.