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Greece May Miss ECB Payment As Germany Says Bailout Timeline Is Unrealistic
Greek PM Alexis Tsipras won a hard fought victory over party rivals on Thursday when Syriza’s central committee voted to postpone an emergency congress until after formal discussions on the country’s third bailout program are complete.
Syriza has been grappling with bitter infighting since more than 30 MPs in Tsipras’ parliamentary coalition defected during a vote on the first set of bailout prior actions, forcing the PM to rely on opposition votes to clear the way for formal discussions with creditors. The party dispute was exacerbated by reports that ex-Energy Minister and incorrigible Grexit proponent Panayiotis Lafazanis (along with several Left Platform co-conspirators) planned to storm the Greek mint and seize the country’s currency reserves.
Fed up, Tsipras told 200 members of Syriza’s central committee on Thursday that essentially, they could either hold a party referendum on the bailout on Sunday or wait until September to sort things out, leading us to note that "were Syriza to vote on whether or not Greece should follow through on the agreement with creditors, the market could be in for an event that is far more dramatic and important than the original referendum."
Lafazanis refused to go along with the idea. "How many referenda are we going to hold? We’ve already done one and we won with 62 per cent of the vote", he said. Ultimately, the party approved a September congress. This gives Tsipras some "breathing space," FT notes, "but Thursday’s highly charged debate signalled that the Left Platform, which supports an end to austerity and a 'Grexit' from the euro, would continue to oppose a fresh bailout."
And the party’s radical leftists aren’t alone in their opposition to the third program for Athens. On Thursday, FT reported that according to "strictly confidential" minutes from the IMF’s Wednesday board meeting, the Fund will not support the new bailout until the debt relief issue is decided and until it’s clear that Greece "has the institutional and political capacity to implement economic reforms."
Somehow, all of this must be worked out in the next three weeks. Greece must make a €3.2 billion payment to the ECB on August 20 and if the bailout isn’t in place by then, it's either tap the remainder of the funds in the EFSM (which would require still more discussions with the UK and other decidedly unwilling non-euro states) or risk losing ELA which would trigger the complete collapse of not only the Greek economy but the banking sector and then, in short order, the government. The question is whether Germany can be reasonably expected to take it on faith that i) the Greek political situation will not eventually result in Athens walking back its austerity promises, and ii) that the IMF will eventually hold up its end of the deal once Berlin approves some manner of debt re-profiling for the Greeks.
Now, according to Focus magazine, there are questions as to whether the timetable for cementing the bailout agreement is realistic. German lawmakers may now have to postpone a Bundestag vote and Athens has already discussed the possibility of taking a second bridge loan from the EFSM, Focus says. Here’s more (Google translated):
The timetable for the negotiations on a third aid package in favor of Greece is to look for an internal assessment of the federal government any more. According to the already contemplated for mid-August special session of the German Bundestag must be moved, according to government sources in Berlin.
The objective pursued by the EU Commission scheduling is too closely knit, criticize experts.This was reported in its latest issue of FOCUS.
Accordingly, the negotiations should be completed before August 10.On August 11, the euro zone finance ministers would approve the results before the agreement of other euro countries ratified and approved by the Parliament in Athens.Also, the Bundestag must still approve.
Due to delay Greece threatens a serious cash problem.The government in Athens must, at the latest on August 20, 3.2 billion euros, the European Central Bank to transfer (ECB), which should be possible without new loans from the third aid package barely.
Therefore already searched in circles of the EU Commission for ways to temporarily raise money from another pot. Speaking here a renewed bailout from the European Financial Stabilisation Mechanism is (EFSM)
This is difficult, however, because the EU states will again require an indemnity outside the euro-zone in this case. As early as September Greece must further loans operate: The International Monetary Fund (IMF) then expected repayments totaling € 1.56 billion in four tranches.In addition, running on 4 September from short-term government bonds in the amount of 1.4 billion euros, which Greece must also refinance.
And here’s the summary from Bloomberg:
German parliament meeting that was considered for mid-August might have to be postponed as European Commission’s schedule for aid talks is "much too tight," Focus magazine reports, citing unidentified people in German govt.
Greece has to pay EU3.2b to the ECB by Aug. 20, which it may not be able to do without third aid package.
In other words, Greece will likely need yet another bridge loan from the EFSM and that will once again require the approval of non-euro countries that will, for the second time in a month, be asked to put their taxpayers at risk in order to keep the ill-fated EMU project alive and preserve the now thoroughly discredited notion that the currency union is "indissoluble."
And make no mistake, Greece and its EMU "partners" had better hope things go smoothly after August because one more bridge loan and the EFSM is tapped out, which means Brussels will have to devise some other circular funding mechanism in the event the third program (which is itself nothing more than a dressed up ponzi scheme) isn't in place by September.
Or, summarized in one picture:
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What the fuck is he smiling at? Has it become funny to enslave a people and be a complete failure in every area of your job? I guess he is following in the steps of Gran Communista Obama where any murikan decent is punished severely.
It's called flatulance. Children do it all the time.
linear time is a scam...see here: http://www.philiacband.com/propaganda.html
Not sure when it will happen, or if it will be Greece, Puerto Rico , Chicago, or some other missed payment, but at some point there will be a Critical Mass Default, that will send the over indebted world economy into a tailspin that can’t be recovered from. The response will make the still spinning printing presses from the financial crisis look like childes play. Or they may just reset at that point to a new monetary system.
Puerto Rico said it won’t make a bond payment due Saturday, putting the commonwealth on a path to default and promising to initiate a clash with creditors as it seeks to renegotiate its $72 billion of debt.
http://www.bloomberg.com/news/articles/2015-07-31/puerto-rico-official-s...
..... as in .... " I fart in your general direction..."
https://www.youtube.com/watch?v=A8yjNbcKkNY
If PR is allowed or permitted to default, in which chapter ?
If Chicago is allowed to default.
If Greece is allowed to default, within the EU ?
Chicago can probably follow the Detroit plan...but it is not clear how sovereign countries "default".
"default" = credit event. Will a 'cedit event' be allowed ?
If legally allowed, there is little precedent.
Probably needs the world court (the Hague) or world bank (BIS, etc.) to get involved, European ECJ, or UN ICJ...if they can or want to.
Too early has to happen Sept 17 2016 so we can relive Lehman Brothers MkII with another bsnk bailout
Spammer
Let me make sure I understand this all correctly....
Greece won't be able to pay back it's creditors (Germany) unless it borrows more money from it's creditors (Germany).
Makes perfect sense!
The best explanation is from Clarke and Dawe:
www.youtube.com/watch?v=I5QwKEwo4Bc
You just can't go wrong with Clarke and Dawe.
Why isn't China running to their rescue? What happened to all of the bailouts they were going to provide? Or Russia?
Leftists: MSNBC's Ed Schultz canned for speaking out against Obamatrade
http://tinyurl.com/qyq6z5f
When ur broke, ur broke, soon after there is nothing to do BUT laugh about it.
A third bailout pogrom---. What a joke. And all this just so some wealthy bond owners aren't distressed.
Saved France since 2010. They sold a lot of Greek debts to others (Spain, Italy, etc.) or indebted French citizens. But then France has added trade with Spain, Italy to offset their eventual losses. Spain, Italy, Portugal are all 'fixed' like Ireland with UK. They all have arrangments, except for Greece.
"In other words, Greece will likely need yet another bridge loan from the EFSM and that will once again require the approval of non-euro countries that will, for the second time in a month, be asked to put their taxpayers at risk in order to keep the ill-fated EMU project alive and preserve the now thoroughly discredited notion that the currency union is "indissoluble."
They just keep right on pissing into the wind!
And they haven't even dried out sincle last bi-weekly pisser. Some leaders in Brussels Belgium must be permanently drunk and in the gutter.
That would be a good reason for the VIX to fall into the single digits.
And for gold to fall another $40.
Forward
pretty sure we left realistic behind a few bailouts ago
Wake me up when Greece finally declares insolvency. ..like September 13th !
September 13th? No! Never On Sunday.
(For those of you who don't remember or never knew, "Never On Sunday" is the title of a movie. In Greece.)
The IMF , Euro Group , & ECB: hey guys you can't get blood from a turnip, or a hot potato for that matter.
If Greece ever makes an interest payment, the markets will instantly collapse.
Because, you know, bad news good news, or something...
They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default. They are 100% going to default.
jus sayin
If you had to lay odds at what percentage of probability that Greece might default, what would be your best educated guess?
Thankfully it isn't going to be too serious as there are still plenty of pension funds to cover a worst-case inopportune series of developments.
The EU has committed itself and accordingly some means will be found to make an additional interim loan if needed. That is not the issue. There are three real issues. Issue number one: Whether the capital needs have been correctly calculated in 1st quarter or if substantial additional financing requirements surface later this year which are large enough to have the capacity to politically spoil the deal, Issue number two: Will the IMF bend and agree to accept a delay on the timeline as an haircut or will the IMF insist on a real haircut which would spoil the party for Merkel. Issue number three: Will the Greek electorate find out that the deal is not a deal but a catastrophe and a slide into an economic nowhere-land and will they react accordingly and ask Tsipras to leave office. Any of the three real issues or a combination thereof has the potential to ultimately derail the EU "rescue" policy.
Here we go again.....
Their signing new loan terms every month now.
Just default already Greece, the EU is killing you.
"... losing ELA which would trigger the complete collapse of not only the Greek economy but the banking sector ..."
That is such bull sh.t!
No, the Greek economy would not "collapse".
Yes the banks would go bankrupt.
It will be an "ACCOUNTING SHUFFLE".
Those that own hard assets would still owe them after the "collapse", just like it happened in Iceland.
Those that have their wealth in financial assets will be wiped out.
And then the economy will recover, just like it happened in Iceland.
By design. They survived the first economic assault, this is the kill shot.
There must be a large percentage in the EU with unmanagable debts. Their game plan is to keep Greece alive and attached to EU as long as possible, to ensure they themselves do not need to worry about their own problems.
The hangers on are actually holding onto Greece as a convenience to distract attention away from themselves.
In this large EU this can go on indefinitely and Greece will never be allowed to 'hit bottom', or 'credit event', then recover.
Poor Greece, they will be used and abused until they aren't, and the only logical Greek path is exit.
Interesting time sequence "going round in smaller and smaller circles": NYC-DC-Tripoli-Cairo-Tel Aviv-Baghdad-Kiev-Athens-Ankara-Damascus
Tsipras is the cat with 9 lives
This is the longest running shitshow since the death of the Weimar Republic: http://www.amazon.com/When-Money-Dies-Devaluation-Hyperinflation/dp/1586...
Hope it ends better...
WTF? There ahve been emergency, last chance, this is it, end of the line deadlines for 3 years.
beyond absurd. Greeks need to keep taking these fools for all they are worth.
Mr. Tsipras is smiling because his motto is ..I can...I can... I can... I mean "I can keep kicking the can"