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Greeks Get First Look At Their Future: Long Bank Lines And Punishing Taxes
Although the details of Greece’s third bailout program have yet to be finalized, Monday marked the beginning of a new dawn for Greeks. Last week, PM Alexis Tsipras forced a set of draconian "reforms" through parliament and sacked political rivals, effectively legislating away the country’s sovereignty while condemning the Greek people to a fate of even tougher austerity and ensuring that despite rhetoric out of Athens, "normality" will not return to Greece for a very long time.
Greek banks reopened and as expected there were long lines. On the bright side, the queues were described as "orderly." From AP:
In downtown Athens, people lined up in an orderly fashion as the banks unlocked their doors at 8 a.m., taking a number and reading the paper as they waited for their turn at the till.
Many restrictions on transactions, including cash withdrawals, remained, however.
The Greek government kept the daily cash withdrawal limit at 60 euros ($65) but added a weekly limit of 420 euros ($455) that will be available beginning Sunday. This means depositors who don't make it to the bank on Monday to withdraw cash could pull out 120 euros ($130) on Tuesday instead, and so on, so Greeks don't have to feel they need to visit an ATM every day.
Bank customers will still not be able to cash checks, only deposit them into their accounts, and they will not be able to get cash abroad with their credit or cash cards, only make purchases. There are also restrictions on opening new accounts or activating dormant ones.
Meanwhile, the VAT hike - one of the most contentious "red lines" from Greece’s negotiations with creditors - kicked in. The tax rose to 23% from 13% on everything from salt to firewood. Restaurants and taxi fares are also affected. Just call it an EMU member fee.
Additionally, Greece gave the go ahead for Europe to pay itself back for previous loans to Athens. Over the weekend, the country received an EFSM bridge loan for €7 billion - €6.8 billion was used on Monday to repay creditors, including the ECB. As noted on Sunday, "now that a new circular funding scheme has been devised that will allow Greece to make a €3.5 billion (€4.2 billion with interest) payment to Mario Draghi on Monday, the ELA liquidity drip can continue."
Or, as some pointed out, Greece gets to keep a transaction fee of about €300 million for facilitating a €6.8 billion payment from the Creditors to the Creditors.
As for the possibility that Greece could see its debt written down as part of a push by Brussels to appease the IMF (and by extension, the US Treasury), Angela Merkel looks to have driven the final nail in that coffin on Sunday. Here’s Bloomberg:
"A classic haircut -- writing down 30 or 40 percent of the debt -- this cannot happen in a currency union," Merkel says in interview with German broadcaster ARD. "You can have it outside a currency union, but you can’t have it in a currency union."
“Part of the wish for Greece to remain in the euro area is that such a haircut is not possible,” Merkel says
Merkel says euro leaders will discuss extension of Greek debt maturities and easing interest rates “when the first successful assessment of the program being negotiated now is completed.”
“Exactly this question will be discussed then,” Merkel says on debt relief. “Not now, but then.”
In other words, there can be "re-profiling" (as suggested by the EU Commission), but there will be no writedown, and indeed Christine Lagarde seemed resigned to the impossibility of a haircut last week.
So that’s it - a rather depressing and anticlimactic end to the Syriza "revolution" and, by extension, to "hope" in Greece. More austerity is now the law and Athens is once again completely beholden to the German purse string.
But hey, at least there are no tanks in the streets.
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Time to leave Greece. Which ever brains are left will now leave.
Taxes will decrease from 13% to 23%.
1984 doublespeak.
Tax revenue will fall despite the increase.
No one in Greece is worried about taxes, since its impossible for the Greek govt to enforce, even with outside help.
What the Greek people care about is the destruction of property right laws.
All the roadblocks and legal protections citizens have against asset forfeiture are being/have been stripped away, so that even fraudulent foreclosures can take place with relative ease (talking about banks utterly just making up mortgages that never existed and taking peoples homes).
The normal judicial practices are just being eroded away, that being said even that really wont amount to much as any home that is stolen will swiftly be burnt to the ground and rendered uninhabitable.
Real estate in Greece is about to take a nose dive.
Warren Buffet bought himself an island for shits and giggles. The guy has too much money. What the hell does he need a Greek island for? Is he now into little boys?
Are German tourists still visiting Greece? I guess they're just as dumb as the Greeks who are insisting on keeping the Euro.
DUMB SHEEP EVERYWHERE
When does the shearing start?
some things you have forever
.
for everything else you need to go to the bank
.
drive safe everyone
Short term gain, long term pain.
or
Short term pain, long term gain.
Thinking the short term of about 3 - 5 years. But it will not take near that long to determine the impact on GDP of pension reductions and VAT increases. I will place my bet on an increase in the debt/GDP ratio over an increase in GDP.
Prediction: anyone left in Greece under 30 will soon be planning their personal "GrExit".
The EU will just pull a USA and make them pay taxes for the country they came from.
"A classic haircut -- writing down 30 or 40 percent of the debt -- this cannot happen in a currency union," Merkel says in interview with German broadcaster ARD. "You can have it outside a currency union, but you can’t have it in a currency union."
Under what economic theory is it not possible? I've never heard of such a theory. The US, with a "currency union" of many different states, allows for bankruptcy. There are certain restrictions, and ways to go about it, but the option IS there.
In fact, you can't HAVE a functioning currency union, or economy, without an escape-hatch for those who stumble. Bad debt cannot be permitted to stay on your books and stagnate, any economy that allows for debt MUST have a means to discharge it when needed, or it accumulates until it brings down the entire system.
So shut the fuck up Merkel. You don't know WHAT you are talking about. This TINA doctrine has got to be exposed for the big fucking LIE that it is!
I have written the same. There is no linkage between writing down debts and a currency unit. That is as if it would be impossible for any state in the US to get bankrupt within the USD currency. That's pure nonsense, or a plain lie. You "can" choose. But in this case I'd argue it's to make the point that Greece "must" not leave the EUR. That just can work if the expenses and income are properly adoptes. So it would mean massive income cuts on any level in Greece. I'm sure it's currently happening, but we will not learn about it. The way outside the EUR would just make it easy for the central bank of Greece to inflatet the currency, In the end it just means get less money in reality. The EUR way is simply the more truth way. because it would not harm the savers, but you know states are the biggest debtors and so they prefer the debtors, you can see it within every law or "bail-out" of Greece.
Still it won't work.Greece is broke beyond any repair and this new debts will not make life easier, quite the opposite. There will be a third more debt as before and that does not have worked for Greece, and so the "new" bail-out will not work either. But the party can go on. The ECB can just print more money and the debts level go up like a rocket. Well yes tell something about sustainability....
How can a currency union operate if it is clear members can ring up shit tons of debt and then just get it "written off?" Wouldn't that perverse incentive basically signal 0 discipline? Italy, Portugal and Ireland were chomping at the bit hoping to see Greece get to write it all off, now they know it is either the Euro or their old crappy devalued currency. Personally, I believe they should return to their own currencies. However, it is now clear that debtors cannot expect to get everything they want which is good and in the long run will keep the system functioning for those that remain within its confines.
There is a solution: Lloyd Blankfein
Blankenfein's Monster.
The pace at which the tribe is moving now is accelerating. Yesterday Cyprus, today Greece. Tomorrow the world.
Bitcoin users are not affected.
OH my FUCKING GAWD PEOPLE!!!
Civil Disobedience
Your fucking dam secret weapon is and will always be against the POS kings and queens that rule over you ( and will always rule over until you get this)
It is called Civil Disobedience. the peoples weapon!!!!!!!!!
"Withholding payment of taxes is one of the quickest methods of overthrowing a government"
Mahatma Gandhi
grow gardens and stop paying all forms of services and credit bills...it will stop the madness in it tracks in weeks!!!
fucking Weeks!
amazing, the people have not figured it out yet..
"Men will never be free until the last king is strangled with the entrails of the last priest."
A new dawn or a Golden Dawn?
From what I read on this thread a 23% VAT is not uncommon for a European country. For fucks sake, why does anyone pay it, on top of your already sky high income taxes?!?!
You couldn't pay me to live in europe, because all my salary would be eaten up by taxes anyway.
not all.
only 75% of sallary.
Ireland has 30% vat.
So what?
what a nonsense:
"You can have it outside a currency union, but you can’t have it in a currency union."
If there is lending, then there must also an option, how to handle a "greek" situation of being not able to pay back a full amount.
Then the haircut is not only possible, but the most probable solution of a deadlock.
Those Freie Deutsche Jugend https://de.wikipedia.org/wiki/Freie_Deutsche_Jugend, or what a name did it carry, didn't care much about basic logic....
I have no respect for the greek pussies. they voted no, their representives said screw the people we gonna do what we want. and the people are not burning the human thrash in the public square. they deserve every bit of suffering they get at this point.
So this is what 21st century slavery looks like.