Total Collapse: Greece Reverts To Barter Economy For First Time Since Nazi Occupation

Tyler Durden's picture

Months ago, when Alexis Tsipras, Yanis Varoufakis, and their Syriza compatriots had just swept to power behind an ambitious anti-austerity platform and bold promises about a brighter future for the beleaguered Greek state, we warned that Greece was one or two vacuous threats away from being "digitally bombed back to barter status."

Subsequently, the Greek economy began to deteriorate in the face of increasingly fraught negotiations between Athens and creditors, with Brussels blaming the economic slide on Syriza’s unwillingness to implement reforms, while analysts and commentators noted that relentless deposit flight and the weakened state of the Greek banking sector was contributing to a liquidity crisis and severe credit contraction. 

As of May, 60 businesses were closed and 613 jobs were lost for each business day that the crisis persisted without a resolution. 

On the heels of Tsipras’ referendum call and the imposition of capital controls, the bottom fell out completely as businesses found that supplier credit was increasingly difficult to come by, leaving Greeks to consider the possibility that the country would soon face a shortage of imported goods. 

On Tuesday, we brought you the latest on the Greek economy when we noted that according to data presented at an extraordinary meeting of the Hellenic Confederation of Commerce and Entrepreneurship, retail sales have fallen 70%, while The Athens Medical Association recently warned that 7,500 doctors have left the country since 2010. 

Now, the situation has gotten so bad that our prediction from February has come true. That is, Greece is reverting to a barter economy. Reuters has more:

Wild boar and power cuts were Greek cotton farmer Mimis Tsakanikas' biggest worries until a bank shutdown last month left him stranded without cash to pay suppliers, and his customers without money to pay him.


Squeezed on all sides, the 41-year-old farmer began informal bartering to get around the cash crunch. He now pays some of his workers in kind with his clover crop and exchanges equipment with other farmers instead of buying or renting machinery.


Tsakanikas is part of a growing barter economy that some Greeks deplore as a step backward from modernity, but others embrace as a practical means of short-term economic survival.


When he rented a field this month, he agreed to pay with part of his clover production.


"It's a nightmare. I owe many people money now - gas stations and firms that service machinery. I have to go to the bank every single day, and the money I can take out is not enough," said Tsakanikas, who also grows vegetables and corn on 148 acres (60 hectares) of farmland.


"I've begun bartering in some forms - it existed in the past but now it is growing... Times have become really tough, and friends and relatives help each other out."

So Greece, the birthplace of Western civilization and democratic governance, is now literally sliding backwards in history.

The nation - which has already suffered the humiliation of becoming the first developed country to default to the IMF and which was nearly reduced to accepting "humanitarian aid" from Brussels when a Grexit looked imminent a few weeks back - is now transacting in clover, hay, and cheese. Here’s Reuters again:

Tradenow, a Website started three years ago to facilitate barter of everything from food to technology, says the number of users and the volume of transactions have doubled since capital controls came into effect on June 29.


"Before capital controls, we were reaching out to companies to encourage them to register," says Yiannis Deliyiannis, the company's chief executive. 


"Now companies themselves are getting in touch with us to get registered."


He rattles off a list of firms using the site to strike deals with suppliers: a car repairs shop that exchanged tyres with another firm for a new shower cubicle, a burglar alarm provider offering services in return for paper and advertising, an Athens butcher that trades daily meat supplies for services.


In the lush yellow and green fields outside Lamia dotted with cotton, peanut and olive groves, barter is also flourishing on an informal basis outside the online platforms.


Kostas Zavlagas, who produces cotton, wheat, and clover recounted how he gave bales of hay and machine parts to another farmer who did not have cash to pay him.


"He is going to pay me back in some sort of product when he is able to, maybe in cheese.”

Yes, "maybe in cheese", but certainly not in euros, especially if the growing divisions within Syriza render Athens unable to pass a third set of prior actions through parliament next week.

Should the vote not pass, it’s not clear if Greece will be able to obtain the funds it needs to pay €3.2 billion to the ECB on August 20 - a missed payment would endanger the liquidity lifeline that is the only thing keeping any euros at all circulating in the Greek economy.

On the bright side, "barter has been a part of everyday life for Greeks for a long time" economist Haris Lambropoulos told Reuters. The only difference is that now, "it is a more structured and organised phenomenon."

Maybe so, but this is one "structured and ordered phenomenon" that many Greeks would likely just as soon do without and indeed, the new barter economy is drawing comparisons to a period in Greece’s history that has gotten quite a bit of attention over the course of the last few months, and on that note, we’ll give the last word to Christos Stamatis, who runs the barter website Mermix:

"Of course, a barter economy is something that we shouldn't aspire to and should be a thing of the past - the last time we had it on a large scale was when we were under [Nazi] occupation."

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lasvegaspersona's picture

Gold is stymied. It's price falls as it's value rises. As long as the derivative market exists it will be next to useless as a tool in finance.

For now it is the best insurance policy but simply cannot be deployed in our current system.

Four chan's picture

i hope it gets stymied to zero so my stack can exceed my physical weight.

J Jason Djfmam's picture

How much gold will you buy when it is at zero?

SgtShaftoe's picture

Well, since we're talking fantasyland, I'd buy it all.

Squid Viscous's picture

what was so bad about Nazi occupation vs. ECB occupation? remind me again?

Ignatius's picture

Well, at this point, one can still win many arguments by calling your opponent a Nazi, so there's that.

joe90's picture

It was trumped by the title

g speed's picture

and monkeys typing long enough will write the bible-----I can't belive the things people are given credit for.

holgerdanske's picture

the Germans in those days actually shot and killed people that did not co-operate with them.

they have not done that this time around, as far as I know, -- yet!


The Germans lost the war, but, it seems, won the peace. Even the US is run by ex-Germans in politics, science and in the industrial military complex in general.


Who woulda thunk? Together with the unmentionables.

large_wooden_badger's picture

Fourth Reich, baby! Living the dream!

GoldIsMoney's picture

Stupidity, still not maxes out. Oh no it's not stupidity it's just pretendign to know and especially to know the scape goat. You do not even get cause and result right. The results you can see in Greece, are caused by greek politicians and bureaucrats in breaking records on debta acuumulation. No Greek debs, no "viertes Reich". Unfortuantly the German politicians are as stupid as your kind. They did not even see that coming, but it was clear to every one else. Yes should the creditor, that's you way of thinking. I'm not sorry for you if you wil suffer on your own stupidity and hate. Just wish upon you what you seem to which about "Germans".

Sanity Bear's picture

This is not peace.


And killing people by starving them is even more cruel that shooting them.

large_wooden_badger's picture

Apart from getting roughed up or killed by the SS, no jews anywhere

KnuckleDragger-X's picture

Freedom is just another word for nothing left to lose... Coming soon to a town or city near you.......

eatthebanksters's picture

There will always be liars who promise free shit to the masses to get elected and there will always be masses who want free shit.  It will never change.  Look at the US and tell me how Boehner and McConnell are any different from Reid and Pelosi.

Jack Burton's picture

I've lived through many Republican presidents and Democractic Presidents. What changes? Nothing, except on the edges of social issues, where government has no business at all involved. On all the issues of war, spying, police state, military spending, corporate bailouts, banker control of the state, market manipulation, bubble blowing, etc. Both parties are in the same "Deep State" Party. Elites rule no matter who people elect.

FreeMoney's picture

I think there are continuous changes.  It is always more government and more corruption.  I agree that R vs D makes no difference in the outcome.

Callz d Ballz's picture

Speaking of which, Rep Mark Meadow R-NC submitted a resolution this am to oust Boehner from his speakership position due to his long list of dereliction of duties stemming from inaction and moves to make congress subservient to judicial and executive powers.  Boehner's circles are highly pissed of course which motivates me to make a call to my congresscritters to support this move, albeit in vain most likely.  Any chance though to stick it to the old guard is good IMO...   

VWAndy's picture

Gold is barter. So is everything that has a real value.


kralizec's picture

If you don't enter Bartertown with'll leave with what you came in with - nothing.

large_wooden_badger's picture

You can always shovel shit can't you?

divingengineer's picture

A barter society is probably a much more interconnected, engaged and functional society.

They may spend more time putting deals together to get by, but it probably beats the hell out of the rat race I live in every day in the SF Bay Area.  It really is every man for himself here. You can't do that in Bartertown. 


joe90's picture

True but it can also get very tribal, each tribe, of course, thinks they are very special, the rest sub-human, and then it becomes every tribe for themselves.  That's the way much of the world was before the West turned up to civilise, some would say it hasn't changed.

Meat Hammer's picture

A barter society is as harmonious as nature itself.  It requires balance to survive, unlike government controlled by banksters, which requires division, fear, mistrust, and violence to survive.

SgtShaftoe's picture

No, Barter societies are absolute hell holes. I've been around some. Not pretty. I recommend you read Adam Smith's "Wealth of Nations". It's an oldie but a goodie. There's a reason human beings developed monetary systems. They allow for savings, investment and complex societies.

secretargentman's picture

Strictly speaking, gold is NOT barter. Barter implies a coincidence of wants, but gold is ALWAYS in demand because it's money. Real money.

VWAndy's picture

Maybe you should stick to reading ZH.

nightwish's picture

Does sex count as barter?

VWAndy's picture

If there is a happy ending then yes.

Temporalist's picture

As a child I joked that if I got paid for people to watch me masturbate I'd be a millionaire.  Now people actually pay on the internet to watch people masturbate.  Who am I to tell people what to waste their money on?

large_wooden_badger's picture

It's the oldest form of barter, I've heard

divingengineer's picture

I don't know, what are you wearing?

dontgoforit's picture

What is confidence?

A Navy Seal walks into a bar and takes a seat next to a very attractive woman.   
He gives her a quick glance then casually looks at his new Apple watch for a moment.
The woman notices this and asks, "Is your date running late?"

"No," he replies, "just got this state-of-the-art Apple watch, and I was just testing it."
The intrigued woman says, "A state-of-the-art watch? What's so special about it?"
He says, "It uses alpha waves to talk to me telepathically."
The lady says, "What's it telling you now?"
"Well, it says you're not wearing any panties."
The woman giggles and replies, "Well it must be broken because I am wearing panties!"
The Navy man smirks, taps his watch and says, "Darn thing's an hour fast."
And that, my  Confidence!


MsCreant's picture

Gosh, now why did this joke have to be about a Navy Seal to work???

Couldn't it have been most any man?

Charming Anarchist's picture

He did not tell the rest of the joke.  It keeps going. 

The woman giggles and replies, "Well it must be broken because I am wearing panties! Really tight panties because I am hiding this!!" while "she" whips out "her" schlong. 

J Jason Djfmam's picture

Would a Navy Seal really wear an Apple watch?

q99x2's picture

I'm sure they are using crypto-currencies more than anything else at this time.

VWAndy's picture

Some peoples words have real value. I suspect that for now is the real coin in use in Greece now. On the street level.

oddjob's picture

i'll bet it goes something like this

I'll trade you this mathematical equation for a dozen eggs

reply: GTFO

large_wooden_badger's picture

Pythagoras would starve in today's world.

oddjob's picture

I'm thinking he could dig a trench with proper grade without too much instruction.

large_wooden_badger's picture

It would certainly not seem irrational

PTR's picture

Diogenes, however, would be well situated to these conditions.


He may actually find an honest man, as personal reputation counts for something again.

Jendrzejczyk's picture

Dishonest men are so prevelant now that nobody believes an honest man exists.

This has become a problem for me.

general ambivalent's picture

When honest men are treated like The Idiot you know it is very close to all falling down.

overqualified's picture

The cryptonerds will serve you an axiom you can't refuse

MANvsMACHINE's picture

Sure they are.  I'm sure that farmer is trading in Bitcoin as I write this.