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Europe Considers Emergency Debt Writeoffs As Greece Faces "Ungovernable Chaos"
Greek FinMin Yanis Varoufakis is in Luxembourg on Thursday for a meeting with EU finance ministers. Some EU officials indicated earlier in the week they hoped some progress on the stalemate between Athens and Brussels could be made at the meeting, but Varoufakis, whose track record at Eurogroup summits is not great, said he would not be presenting a new proposal at the talks, setting the stage for an emergency meeting between the EU’s top brass over the weekend and the possible imposition of capital controls to stem the flow of deposits out of the ailing Greek banking sector.
Protesters took to the streets in Athens on Wednesday evening, marking a fresh wave of anti-austerity protests while Zoe Konstantopoulou, the president of the parliament, chided Bank of Greece governor Yannis Stournaras for a report in which the central bank warned of an “uncontrollable crisis” and “soaring inflation” if a deal with creditors isn’t struck soon. “With his report today, the governor of the Bank of Greece not only exceeded the boundaries of his institutional role, he is attempting to contribute to the creation of an asphyxiating framework in the moves and negotiating abilities of the Greek government,” Konstantopoulou said.
There’s some speculation early Thursday that EU officials could soften their stance on Greek debt relief. The idea that EU creditors should write down their Greek debt holdings in order to bring down the country’s unsustainable debt burden has been floated by the IMF on several occasions recently, although it’s been met with a lukewarm reception from Brussels. Three years ago, eurozone ministers agreed to consider writing down their loans to Greece in order to appease the IMF but never followed up. According to Kathimerini, that agreement could be reiterated next week at the EU Summit. Here’s more (Google translated):
While finance ministers of the Eurozone have gathered in Luxembourg for another Eurogroup, in which the expectations of any progress in the Greek issue is very limited, discussions focus on who and when there could be a further debate which will bring and the solution to the impasse that has been created in recent months.
According to a senior European official said the scenario is considered and the more likely this time is to convene an emergency summit of eurozone members Thursday evening (25.06) after the end of the deliberations of the Summit scheduled on that day and has very heavy agenda. The aim is the Greek issue not overshadow this way the other serious issues to discuss as the Grexit and immigration policy. At the same time it will have spent one week from today's Eurogroup meeting without another thus putting further pressure on the Greek side.
According to him a high-ranking European official, this time from European Commission and European Central Bank edit text that refers to the debt issue in the event of agreement. A re-statement for debt relief won the Greek side of the Eurogroup of November 2012 when he was the Minister C. Stournaras.
More, via Bloomberg:
EU Commission, ECB draft statement on debt relief, which could be used if a deal is reached between Greece, creditors, could be a renewal of Nov. 2012 Eurogroup commitment, Kathimerini reports, citing unidentified EU official.
Euro area finance ministers agreed in Nov. 2012 that “euro area member states will consider further measures and assistance, including inter alia lower co-financing in structural funds and/or further interest rate reduction of the Greek Loan Facility, if necessary, for achieving a further credible and sustainable reduction of Greek debt-to-GDP ratio, when Greece reaches an annual primary surplus, as envisaged in the current MoU, conditional on full implementation of all conditions contained in the programme”
This would be “in order to ensure that by the end of the IMF programme in 2016, Greece can reach a debt-to-GDP ratio in that year of 175% and in 2020 of 124% of GDP, and in 2022 a debt-to-GDP ratio substantially lower than 110%”
Greek govt has said that country needs something more concrete than Nov. 2012 commitment, which was never implemented even after Greece achieved a primary budget surpluses in 2013, 2014
As discussed last weekend, it's possible that Greek PM Alexis Tsipras could spin a writedown of Greece's debt burden as a concession he extracted from creditors in exchange for a softened stance on pension reform and the VAT, although it isn't yet clear how well that would play with Syriza's Left Platform or with voters.
Meanwhile, Christine Lagarde is attempting to dispel the idea that she has discretion to grant Greece a grace period after June 30. From Bloomberg:
“I have a deadline, which is 30th of June, when a pyament is due from Greece,” IMF Managing Director Christine Lagarde says at press conference in Luxembourg. “If 1 July it’s not paid, it’s not paid.”
“There is no grace period or 2 months delay as I have heard.”
“It will be in areas, vis-a-vis the IMF. But I hope it’s not the case.”
Despite the rhetoric, it certainly does appear as though Lagarde could avoid triggering accelerated payment rights for other creditors by delaying the delivery of a formal failure to pay notice to the IMF board by 30 days.
Finally, some asset managers contend the market is understimating the fallout from an escalation in the Greek crisis. Russel Matthews of Bluebay for instance, says ideology and politics may prove difficult to overcome. Indeed, the following comments echoe everything we've said recently about the politicization of the negotiations:
Sovereign markets are still unprepared for the uncertainty and turmoil that is coming in Greece, Bluebay portfolio manager Russel Matthews says in interview.
Divide between Syriza and European policymakers is too large; early expectations of a last-minute deal have been shattered due to danger Syriza poses for euro zone.
European institutions “cannot allow Tsipras to be seen to be successfully breaking the rules of the game”.
“Syriza is an ideologically driven entity” which makes it highly unlikely that deal can be done in time to prevent onset of capital and deposit controls in Greece.
Tsipras’ claim to be working for all Europeans is a “dangerous assertion to make to the political hegemony that has designed the system that governs Europe”.
Had hoped Tsipras would be more pragmatic once he was in power but “increasingly obvious that he sees himself more as an activist hero”; has turned into Chavez rather than Lula.
We'll close with Matthew's grave warning about what comes next:
"Greece domestic situation will be chaos and ungovernable."
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Europe Considers Emergency Debt Writeoffs
Yeah, go ahead and do that.....to infinity.....and beyond.
Then do it for everyone else. In September.
Shemittah, baby!
How Goldman Sachs Helped Greece to Mask its True Debt
Oh boy. If Greece gets debt write-offs, Spain & Italy will have a ton of fun next year.
problem with that: banks still hold spanish and italian debt. us and european taxpayers are now (un)proud owners of a majority of greek debt (courtesy of IMF, ECB and EU). debt write offs hurt the taxpayers....so, no big deal really. we're used to getting raped by the central bankers and IMF.
Spain & Italy will have a ton of fun next year.
It's all connected...right down to your mortgage. Do you really think our intrepid bankers want to commit suicide?
Throw those pathetic Greek deadbeats out of Europe already.
Throw those pathetic German banksters out of Europe already.
Throw those pathetic banksters out of Europe already.
Keep those pathetic German Banksters in Europe...and LOCK THEM IN.
They are just members of the DEADBEAT CLUB....like Wolferi.
Looking forward to the collapse of Douchebunk.
Oil Derivatives have already taken them out.
The Financial World does not want to recognize it as it is 2 Orders of Magnitude worse than Lehman Bros...It is actually on the same level, if not exceeding that, of AIG.
This is not going to be a Meltdown but more like a Dresden Firestorm Inferno which will consume anyone exposed and suffocate anyone initially insulated in shelters...followed by a baking.
Good Bye Germany. It will be wonderful to watch you go up into the flames that your National Socialist Republik deserves.
Fuck the Socialist states of the European Socialist Union.
Fucked up EUROTRASH.
Burn baby, burn.
You literally haven't a clue what you are talking about.
EDIT - The bombing of Dresden was a war crime, which killed not a single member of the Wehrmacht, but killed thousands of old people and little kids. Whomever ordered it -- if God is just -- in burning in Hell right now next to Hitler & Stalin.
++++
The London Banking Cabal is largely responsible for more death, terrorism, starvation, homelessness, and wars...... with a capital PERIOD!!!
Fuck you, have a fatal one uglyfuck jew
why wait? Ton of fun this year...............
Because the current politicians in those countries are the equivalent of Hillary Clinton and Jeb Bush. Once Podemos gets in power -- and if Greece proved to work -- then they're really going to go for the jugular.
"Oh boy. If Greece gets debt write-offs, Spain & Italy will have a ton of fun next year. "
The EU could print trillions to save the banks but could not wipe out the debt of Greece of only 350 billions .
The EU is run by a bunch of idiots ! Only the Italian banks got 250 billions from the BCE at 1% interest to invest in bond with interest higher than 1 % .
This is the result of the Euro that is available to the states only paying market interest for bonds , when , with the original currency that those country printed, there was no interest to be paid . The EURO is a faulty project . The BCE should consider giving to each member state 3 % of the budget every year without interest to compensate them for the loss of the national currency !
"Oh boy. If Greece gets debt write-offs, Spain & Italy will have a ton of fun next year."
Back during the Vietnam war, there was talk of a thing called "Domino Theory," the idea being that if Vietnam were to fall, it would soon be followed by Cambodia and/or Laos, and then communism would quickly spread throughout the rest of Southeast Asia. It was a big part of the reason given for why we were there. The notion of falling dominos applies quite nicely in this particular case; should Greece "fall over" it seems quite possible that Portugal, Spain and Italy will not be far behind.
I'm thinking the Euro may turn out to be a rather short-lived experiment.
Greece beagan our descent into the demoncratic hellhole. I guess they are getting their just dssserts.
But all the time, more andmore, I get the feeling that we are actually watching a battle royale between:
a) Vatican
2) The Orthodox church
c) The Coptic Church
d) Church of England
5) Protestants, Lutherans and the American revivalist, Born Again scum factories...
Wanna know the true meaning of God's work?????
http://just-a-thought-from-thinair.blogspot.com/
Yes! zerohedge does a good job than most journalists which is why I read this blog.
zerohedge, please restore my old account: username : "thinair"; you shouldn't have blocked it.
The only question I want to know is if you are not working on the following problem then which problem are you working on. I have asked this question to the Prime Minister of India too. waiting for an answer.
There are ten people and resources to feed only nine. What happens to the tenth and why?
O' Humanity, why are you runing and for what?
Lessee here...
I have a box containing 9 pounds of food but there are 10 hungry people. How will I feed the 10th person?
Yes, I recall this problem from the second grade. They used it to explain the concept of fractions.
It is no longer the private sector that is on the hook if such debt writeoffs should occur, but the public sector. I.e.: European taxpayers.
Syriza is correct: The present course of action undertaken by the "institutions" is undermining the European project as a whole, because it increasingly frays the solidarity between the citizens of EU memberstates.
Explain to me "solidarity"
It's you and anything you can physically touch.
That's "solidarity".
Yeah, fuck you. There will be NO GREXIT ever.
It's already happened. They have run out of lipstick is all...
YES GREXIT BITCHEZZ!!!
score greece a goal in the fifa match, 10 minutes into play...
OT
Three Zillow listings this this am 40% off original asking price.
All of this could have been avoided if the EU would have just written down part of the Greek debt in the first place, imposed moderate austerity, and left enough in place for the Greek economy to avoid collapse.
But supposedly any write down is the ultimate contagion, as all the other PIIGS will want their own too!
Greece is like watching an oncoming training wreck; hard to watch, but impossible to look away. What a CF.....
More like that scene in Monty Python And The Search For The Holy Grail, where the guy is running and running and running, never seeming to reach where he's going...until all of the sudden he does.
"More like that scene in Monty Python And The Search For The Holy Grail, where the guy is running and running and running, never seeming to reach where he's going...until all of the sudden he does."
As I recall, this is immediately followed by a lot of yelling, screaming, and flailing about. Yeah, pretty much sums it up. Kudos!
no way out but moar pain. the banksters have only one option - qe.
paper this bitch, bitchez, ha...
Game theory WORKS!
I actually had that same thought.
Varoufakis will be the new national hero of Greece if they can pull it off
A socialistic basket-case economy dependent on external financing is about to lose its external financing.
...You're going to be unpleasantly surprised by the results.
...And Varoufacuntface is going to end up fleeing the country or hanging from a lamppost when all is said and done.
A letter to Tsipras from Hugo Salinas Price. Silver money for Greece.
http://plata.com.mx/mplata/articulos/articlesFilt.asp?fiidarticulo=264
The question for me is: "What should Greece do with the traitors to the Greek people in the Greek banking sector?"
What should all countries do with traitors to the people who are in the banking sector?
Easy; tattoo dollar signs on their foreheads, remove all their assets, and do not allow them to own anything greater than the clothes on their backs and a begging bowl. They will remain in a self-imposed prison of the mind the rest of their lives that will cost the people nothing to maintain.
If however, they manage to escape that prison without amassing any possessions, all the better, because, by then, they will have ironically become an asset to society.
Greek anarchy .... the Greeks didn't invent the arch .... the Romans did .... the closest thing the
greeks had to an arch .... was the Ampitheater .... and it was lying on it's side !
" "Greece domestic situation will be chaos and ungovernable." "
Brought to you by the European Union and its flawed single currency in its quest for socialist love, peace and harmony across Europe. And a large helping of undemocratic fascism to help things along.
How could anyone, let alone thinking adults, have thought the EU abortion was going to live? Am I a genius among men, or are these EU participants absolute fkng morons?
It's starting to look like no deal is in fact highly likely. The problem the Troika have with this Syriza government is that they are indeed more of an ideological radical party that formed the govenment on their own so they don't have to compromise with anyone... and that is a huge problem for the Troika negotiators... this can still go either way as Syriza does understand clearly that if they do quit the EUR they will most likely be swept away by the people within a year...
"...if they do quit the EUR they will most likely be swept away by the people within a year."
Except that if chaos breaks out after a Grexit, Syriza would use it as an excuse to suspend democracy.
When the Greek people will not be receiving their pensions and paychecks they will hardly be thinking about democracy... I don't know where they expect to get the funding for those payments... China and Russia surely will not be providing that funding... dire straits for the Greeks either way.
Piplines need to be built through Greece, and Russia and China will be buying Geek exports. Turkey will also benifit to a large degree.
The only ones who dont benifit from a Greek exit are the bond holders, with the biggest hits in Spanish and Italilan debt.
Europe Considers Emergency Debt Writeoffs
if this is a sign that whinning works, get ready for a taste of southern culture!
AN-Archy : Without - Master
Chaos is Gov...
Un-fuck the babe on the left and fuck the babe on the right........
The EU will offer to print up 5 or 600billion in free euros for Greece. Greece will in turn pay off the IMF and offer to bail out Germany's banks. Greece will offer to stay in the EU only if EU headquarters are moved to Athens along with a majority of the 23,000 jobs.
Greeks won't be happy unless the EU prints much more so Greece can bail out US banks that are at risk of failure because of derivituves written on odios Greek debt.
This is win/win for the financial world except Germany.
Greeks love schnitzelfaces.
To be fair, the Greeks could use a fucking huge dose of Anarchy ... otherwise known as free-market capitalism.
True story. Anarchy does not necessarily equate to chaos and is most simply defined as law and freedom without force.
ala Wikipedia:
Anarchy is the condition of a society, entity, group of persons or single person which does not recognize authority. It originally meant leaderlessness or lawlessness, but in 1840, Pierre-Joseph Proudhon adopted the term in his treatise What Is Property? to refer to a new political philosophy, anarchism, which advocates stateless societies based on voluntary associations.....
...The German philosopher Immanuel Kant treated anarchy in hisAnthropology from a Pragmatic Point of View as consisting of "Law and Freedom without Force". Thus, for Kant, anarchy falls short of being a true civil state because the law is only an "empty recommendation" if force is not included to make this law efficacious. For there to be such a state, force must be included while law and freedom are maintained, a state which Kant calls republic.[3][4]
As summary Kant named four kinds of government:
Yanis should change his last name to "Various-ways-to-fuck-us"
The European Socialist Union blinks.
where greece goes, all those who are saddled with too much debt (defined as odious using common sense or legal under centuries old historic precedent) ....follow...there, here, corparate, city, state, government or supranational levels.
money held by savers in enablers like banks, governments is holding its breath..."damage control much?"
..."chaos and ungovernable"...
Pure, unadulterated, scare-mongering bullshit.
A little bit OT:
While europe renews sanctions against Russia to appease US neocons, they quietly make deals that fly in the face of those same sanctions. Europe has had enough with the US and its vendetta against Putin. NATO is about to disintagrate. Neocons using 300 million europeans as cannon fodder is comin to an end.
http://rt.com/business/268060-russia-gas-germany-europe/
@ Monetas
The Greeks did invent the arch; they just didn't use it - the Romans did.
Well hell! Time to use the arch to make arch enemies of the western banks! Go Greece!
' . . . is an Ideological entity.'
As far as i'm aware this 'NEW' Government won on a mandate that they ran with and should be respected for fighting tooth and nail to deliver on Election Promises. Refreshing actually when you compare him with another Leader of a Bankrupt Country who after 7 years in power has not only NOT DELIVERED on his Election Promises but has sold his Citizens out in preference of the Banking Cabal.
I would guess Vladmir slipped a few bargaining chips to Tsipra at their last meeting. Debt relief was off the table a few days ago. Why a sudden change of heart?
This has nothing to do with Vlad. It's probably DB (DoucheBank) leaning so hard on the actors that Frau Merkel herself had to say recently that she will do anything to get the talks back.
The Bankers are not yet ready to stop kicking the can, since there's still a few dimes left in it.
And yes, Yannis was right with GameTheory - this level named "who'll blink first" is totally owned (or should I say, pwned) by him. Seems like it was all bluster from the troika talking heads until their masters actually called in to give some piece of their mind on what's going down.
Too little too late
Well Looks like someone in Brussels just found $50 billion in the form of Yukos (Russian Asset) confiscation...Opa!
http://rt.com/business/267964-yukos-belgium-state-assets/
God saves us from ourselves!
Let's hope he still has an interest to. When we are written off by HIM, we're doomed.
They are going to be writing them down wether they want to or not...its trash now...
David and Goliath.
Go Greece, hold your ground. Hold it till the end. They will use scare tactics, extortion and bullying. But you will smile and show them the finger. So what that u have to go back on ur own again? Its not the end of the world.
We're beyond the point of no return now.
If Tsipras caves not only will his gov't fall there will be Civil War in the cities.
Could we be seeing an army coup to "restore order"
When does the sanctions renewal vote take place on Russia? If Greece votes for more sanctions, they have lost what shred of sympathy I had left for these fools
No question it's time for the US to invade Greece, lest they be taken advantage of by somebody else (and let's face it: their situation threatens our national interests, right?) We can provide protection, security, and a three generation payment plan for their financial problems. The banksters are rubbing their hands together on this one.
Be ready for financial engineering so obfuscated that gullible public in Greece would be fed an outcome as victory (Syriza already compromised beyond electoral read lines while west was recalcitrant) but in fact it would mean doom for Greeks after some period of relief. They will go happy to their doom.
Or what's more plausible it is just attack to split and destroy the Greek left via economic turmoil like it was in Chile 1974, as they already destroyed Greek socialists and the right through bribes and corruption. Only Fascists would have left on the scene.
Both scenarious are plausible but second has my vote.
EU is a house of cards, nothing more just a shell of propaganda, they need all paper cards in order to pretend and extend their autocratic rule. The Greece situation is just a manifestation of true purpose of the money issued but supra-state oligarchs of ECB, namely to enslave. They do not even care to be paid off just to enslave for the sake of it, for the sake of power.
All power elites make sure that the purpose their financial system is to propagandize into peoples desire for money as means or ends to achieve something important, money that people cannot create (are prohibited to) or produce in sufficient quantities. This combined with government requirement or threat to be paid dues with their "money” closes the circle of wage enslavement.
An honest and interesting discussion on origin of money within human society and its derivative namely financial system and its “products” can be found at:
https://contrarianopinion.wordpress.com/2015/04/14/plutus-and-the-myth-o...
scatha:
I went to read your link to see if it knew what money is. I was immediately put off by the very first sentence:
We all worship money, believers or atheists, smart or stupid, holy or wicked, strong or weak, rich or poor, men or women.
Money is "a promise to complete a trade". Is that anything someone would worship? I think not!
I searched for the word "money". It used the word repeatedly. But I was almost 1/2 through the essay before I found something that looked like the working definition.
The facilitation of geographical expansion of trade was achieved by ruling powers via devising and promoting exchange of abstract, illusory entity called compact “money” as a universal representation of any commodity, instead of exchanging of particular bulk commodity.
It actually comes close to stating what money actually is ... always has been ... and always will be: "a promise to complete a trade". It says why it was invented ... to extend simple barter over time and space. It says that it was an improvement over its predacessor ... a commodity. So at one time, it appears somebody "got it"!
But then in the very next sentence it loses it.
The money construed by ruling class as a universal commodity allowed something that could not be achieved before, namely almost unlimited primitive accumulation of wealth, precursor to accumulation capital.
Now, even if it were true, the above sentence is totally irrelevant. If someone makes a trading promise and creates X amount of money; then completes the trade by delivering X+Y amount of value; then returns the X and keeps and accumulates the Y, this is somehow bad?
I think not. He is a fool who enters into a trade where there is always risk of failure but is scorned for succeeding. It's not about capitalism. It's not about egalitarianism. It's not about socialism. It's about trade. Period!
These essays are so ridiculous when viewed using the proper definition and purpose of money: "a promise to complete a trade".
You seems to be confused since what you said actually supports the conjecture in the post. What's worth promise to complete a trade without any recognized by both sides authority to provide rules of trade to enforce trade promises i.e. contracts. If such are absent we got gun fight instead of trade. In our reality authorities are run by ruling elites. The is the fact. And also it is the fact that the authorities or their agencies or heavily regulated monopolistic private institutions introduce money to the system and we are forced to accept the money through tax enforcement. The one ridiculous thing I see is your inconsistency and ignorance the basic facts about money that ZH is pontificating over many years. I guest ZH failed in your case.
No Emergency Debts Writeoffs because of Household Chaos for us ?
Spain, Italy et all are you paying attention !
a year later Putin must be laughing his ass off at the shit show Europoe has become.
Whatever the solution is for Greece it will also have to be for Portugal and Spain and Italy otherwise the crisis will keep moving across the continenet and beyond.
At the present time, the solutions have been piecemeal, targeted and ineffective.
Unless there is a world wide move to cut all forms of debt by a substantial amount and raise interest rates, then the pricing signals and the market will continue to experience imbalances, uncertainty and crises.
Every German asset is going to be burned to the ground. Those fat krauts better think of another destination for their summer beach Holiday. How about Eastern Ukraine?
Hot off the press: Greece announces new austerity measures. From now on no more than 5 German tourists are allowed to share a Greek salad!!!!
Headline Puppet Masters face push-back.
- Colonial Powers of Europe fail to get compliance from Greece
- Capital Controls, Loan & Debt Restrictions, EU Mandates on Government Spending, Immigration as a tool of Conquest, Slave Labor within Free Trade Mechanism, Centralized Planning of European Investment, Centralized Banking, Demonizing governments and people that are different from the Ruling Families, Mandated Austerity to suppress wages, Middle Class & to pick the "Losers", Free Money Creation for the "Winners" in Ruling Class, Banking as a Colonial Weapon against a Nation which holds valuable Assets
- USA has the Same Processes of Colonialism, but for some reason people don't discuss this or seem aware that the National Politics have been Captured
- US Colonialism include Corporatism, Inverted Totalitarianism, Oligopolies, Central Bank Manipulation of the Markets against the Middle Class & Fixed Income Families, Centralized Wall Street Banking Power, New Police State with Domestic Spying and with Capital Controls, Endless Wars, Wage & Job Suppression, Suppression of Savings, Inflation in Housing, Biggest Prison State in History to Rival Rome or other Slave States, Gouging Prices in Health Care & Higher Learning, Attacks on Social Security by the Wealthy, No Representation for the Taxation, Open Systems of Bribery of Federal Officials, Open Interference of Federal Government by Foreigners, Systematic Destruction of the Founding Freedom Document, the US Constitution, Systematic Destruction of Laws by Bankers, Lawyers, Lobbyist, and captured Politicians, No Domestic Policy at all for 14 Years, Investment largely is channeled Off Shore without penalty, Economic Model is a Liberal Version of a Trading Empire which would require Slave Labor or Colonialism
Voila, only 1-2 days ago after greeks literally said "FU" to the EU regarding debt, I wrote EU politics have neither brain nor honor and will continue support and finance them. And here we are, that was quick wasnt it? Now they talk writeoffs and "further assistance" which basically mean more bailouts. What an unspeakable insult to the EU taxpayers.
I'd suggest Varoufakis and Tsipras have been doing very well, and made the EZ jokers look the bunch of shysters and also-rans that they are.
National debt is worthless to the bankers, once thepolulace is ungovernable, and taxes are no longer able to be collected.
This is all such a joke! These people are all acting like there's a rational way to deal with irresponsibility. And every one of these parties involved is as irresponsible (or more irresponsible) than Greece.
The best way to deal with irresponsibility is to nip it in the bud.
What Capital Controls ? Big monies already out or hedged. Who are they smoking ? Greek Soverign Currency is the Euro and the virtual borders are too porous for this fish (Euro). Traders falling for this antiquated crap ?