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Meanwhile In Greece, Pension Funds Tap Emergency Loans
This has not been a great year to be a pensioner in Greece.
Over the course of the country’s fraught bailout talks, Greece’s pension system was frequently in the troika’s crosshairs. As for PM Alexis Tsipras, pension cuts were generally considered to be a so-called "red line" and intractable disagreements over pension reform quite frequently resulted in the total breakdown of negotiations.
Meanwhile, the increasingly untenable financial situation and acute liquidity squeeze very often meant that payments to pensioners were in doubt, even as Athens went out of its way to assure the public that whatever funds were left in Greece’s depleted coffers would go to public sector employees before they would go to EU creditors or to Christine Lagarde.
The situation reached it’s "heartbreaking" low point on July 1 when Greek banks that had been shuttered after the institution of capital controls opened for a few hours to ration payments to long lines of pensioners who were forced to effectively beg for €120.
In theory, the bailout agreement - while promising more austerity and more pressure on the bloated pension system - should at least guarantee that there will be money in the banks to make monthly payments, but that assumption now looks to be in doubt because as Kathimerini reports, both IKA and ETAA are tapping a contingency fund that guarantees social security programs for fear that the provisions of the bailout will not provide for sufficient enough savings to fund the remainder of this year’s payouts. Here’s the story:
Greece’s state insurance funds are resorting to external loans to cover their needs as fears grow that the measures of the third bailout will not be enough to cover the rest of 2015’s liquidity needs.
The Unified Fund for the Self-Employed (ETAA) received funding from the Generational Solidarity Insurance Fund (AKAGE) to cover its legal and notary workers’ branch. A similar application for 180 million euros has been approved by the board of the country’s biggest insurance fund, the Social Insurance Institute (IKA).
A ministerial decision by Labor Minister Giorgos Katrougalos and Alternate Finance Minister Dimitris Mardas foresees economic assistance to the tune of 20 million euros from AKAGE to ETAA to cover part of the latter’s deficit.
Of the course the punchline to the idea that funds from AKAGE will be used "to cover part of ETAA’s deficit" is this:
The deficit of AKAGE is expected to grow due to the dramatic increase in unemployment, political and economic uncertainty, capital controls, the measures of the third memorandum and the early elections, which are expected to impact on the revenues of insurance funds this autumn.
So in short, the pension funds are broke as is the contingency fund meant to guarantee payouts from those funds.
So Greece, we truly do wish you the best of luck and as you head back to the polls next month, don’t forget, if things get really bad, you can always storm the mint...
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this is good for ES +27 points..
Greece’s 52 billion Euros Debt Is Tiny Compared to China’s Stock Losses ....All is well. Move on.
The situation in Greece is a complete shit show. Period.
Earlier this year a 3rd bailout was completely off the table. Now they're looking at payments of 86 billion Euros in total from other EU jurisdictions. More can kicking with lip service on reforms from a Greek government which resigned immediately after making the promise.
Cannot possibly get any more fucked up than this.
Who in their fucking right mind would even waste time negotiating with Greeks unless of course the sole purpose of this exercise is the protection of German and French banks.
German tax authority says they have a 26 billion surplus in "revenues" this year. Just to put things into perspective.
That German industrial cow is overripe for the big milking.
Who in their fucking right mind would even waste time negotiating with Greeks unless of course the sole purpose of this exercise is the protection of German and French banks.
Um... yeah, duh. Like, Greece is the first domino. If you like your 401k, you get to keep your 401k. Social Security is spelled P O N Z I. Sukkkahs! Hey, old boomers, here's your Social Security!
Would that be an after 8 mint?
Greece doesn't matter. China is umpteen times larger. Greece will now quietly slide into oblivion.
STFR
Bitchez
"Greece’s state insurance funds are resorting to external loans to cover their needs as fears grow that the measures of the third bailout will not be enough to cover the rest of 2015’s liquidity needs."
Zion and their grifting banksters must be celebrating--More fiat-debt, more debt service, more plunder, more private jet flights, and more skiing in the Alps.
Zion is a scheme, not an ethnicity..
Dear older Americans,
The lesson of the Greek pensioners is that you will either retire and die of starvation, or retire and die fighting these parasites. But you will not retire to paradise.
An American citizen, not US subject.
D@ammit, WHO keeps pouring gasoline on the minefields? Aren't the mines bad enough??
Greek's should burn their government down, do a partial default, apologize to the EU for screwing them over and then can socialism.
However, that will not happen as it involves both reality and responsibility.
The Socialism will continue along with the pain.
The only people dumb enough to loan Greece more money would be...other governments.
"The only people dumb enough to loan Greece more money would be...other governments."
+100
Governments playing with OPM to protect their masters, the banks.
Governments who are of the same economic and political religion. And, yes, the key is that it is their taxpayers' money. Do you think they'd take a second mortgage out on their own homes to send it to Greece? Not a chance in hell. But it's okay with taxpayer money.
When you owe the bank 10,000 euros the bank owns you, when you owe the bank 300 Billion you own the bank.
#41
Greece has no choice but to stop making debt payments to any creditor and look after the survival of its people.
If the government of Greece cannot or will not do that, they should be taken down and replaced.
There is no room in this world for a NWO that will never exist. If we can manage peace it will be an accomplishment in and of itself.
We have to teach the young to stay away from debt and those who sell it.
Greece needs Russian troops.
And anti-aircraft.
Everything else is rearranging the deck chairs.
S-300. The new way to pay back debts.
https://www.washingtonpost.com/news/checkpoint/wp/2015/04/13/examining-the-power-russias-s-300-missile-system-will-give-iran/
"Athens went out of its way to assure the public that whatever funds were left in Greece’s depleted coffers would go to public sector employees before they would go to EU creditors "
THAT IS THE PROBLEM.
THE BUREAUCRATS ARE DEVOURING EVERYTHING IN GREECE.
GO LOOK AT THE LEVEL OF PUBLIC SECTOR EMPLOYMENT AS A COMPONENT OF GDP AND IT WILL BECOME BLINDINGLY APPARENT WHY & HOW GREECE IS BEING BANKRUPTED & DISMEMBERED.
EACH PRIVATE SECTOR TAX PAYER IN GREECE IS STATISTICALLY SUPPORTING MORE THAN 6 DEPENDENTS AND/OR BUREAUCRATS.
WHEN THOSE PRIVATE SECTOR TAXPAYERS CANNOT PAY WHAT THE BUREAUCRATS & POLITICIANS VOTE TO THEMSELVES THE BUREAUCRATS & POLITICIANS PUT GREECE DEEPER INTO DEBT.
LEARN SOME FACTS before you spout off, kchrisc...
DO the Debt Merchants love this situation? Sure they do: but, they aren't the problem.
"DO the Debt Merchants love this situation? Sure they do: but, they aren't the problem."
Ignorant by choice, or just by fucking dumb?
It's been Babylonian money magick, exchanging real labor and real money for TEMPLE FIAT for over 2,000 years.
But this is the dawning of the age of something something....
Come on, bro.
Come into the Light.
Banks CANNOT put a Nation into debt without the permission of it's Government.
WHO sells Greek Government Bonds?
WHO buys the government?
You CANNOT BUY what is not FOR SALE.
WHO IS SELLING?
the government. That is, the people who comprise the government.
I thought that was clear {???}
"If we're looking for the source of our troubles, we shouldn't test people for drugs, we should test them for stupidity, ignorance, greed and love of power." - P.J. O'Rourke.
"the government. That is, the people who comprise the government. "
The average Greek Citizen is no more responsible for what some Greek Politicians and Bureaucrats did/do than You or I are responsible for what Hillary Clinton or Jack Lew or Lois Lerner did/does, etc...
ODIOUS DEBT.
<< the third bailout will not be enough >>
It's paradoxical?!
Tyler Durden must be harnessing those Da Vinci 30min power naps to be posting at 2am.
Hey, it's not even 9 o'clock here in Hawaii. Some of us still need our normal hours fix. Thanks Tylers from all of us here on these rocks in the middle of the ocean.
And those on the other side of the middle of the ocean as well. I've only just got back from work, and the working day hasn't even begun for a lot of the USA'ians.
I sometimes have a bit of silent chuckle to myself when I see the Friday humour posts and it's already Saturday here.
Cheers
Greece has to be rendered impotent qua state so it can not stop the flood of migrants to come.
what you have now is but a hint of what will be coming by the end of the year.
And to some extent the white supremacist douchebag fucktards are right about who is behind it - they just don't see anything but their usual suspects. The truth is most of the power remains in the hands of Quislings selling out their own nations.
Same as it ever was.
I watched "The Guns Of Navarrone" last night.
Greece looks...eybrowish.
Gregory Peck....not Greek
Nor David Niven
Anthony Quinn...needed a shave the entire movie
Asinine death scene in the boat.
Looked like they blew up the Nazis...so what's the problem now?
Blew up the wrong NAZIs!
"The Greek government has been practicing a particularly aggressive form of antigrowth austerity. While the private sector shrank in 2011, Greece’s government grew to 49.7% of GDP from 49.6% in 2010. To accomplish this bad outcome, Greece’s government increased its value-added tax to 23%—a hidden sales tax so high that no one should be asked to pay it or support it—and created a national property tax that transfers private-sector wealth to the government and through it to foreign creditors. Meanwhile, Greece’s parliament kept full pay, full benefits, its fleet of BMWs, and a full staff. Greece maintained its sweetheart subsidies for businesses, banks, the army and those who choose not to work. Its sizeable delegations and facilities in Brussels, Vienna, Geneva and Washington are still large, as are the life-time pensions for politicians. Last week, Greek officials suspended work on the sale of government assets, one of the most pro-growth conditions in its IMF program. The reality is that Greece’s government is imposing too much austerity on others and not enough on itself.
Read more at: http://www.nationalreview.com/corner/300915/public-sector-austerity-vs-p... "
https://www.allianz.com/v_1435225582000/media/economic_research/press_re...
Greece grew their goverment?
So did the United States.
What do you think deficit spending by 50% for years and years is, while having bases in over 90 countries and involved in overt, covert, and dirty wars all over the globe?
How is it the US has endless money for Ukraine and Israel but wounded warrior project has to build ramps for guys without legs who committed the sin of buying into the lies?
War is the banker's richest harvest.
The Greeks are amateurs. And doing what they are told, like cows to the slaughter.
Spare your sense of outrage for a more deserving target.
You're gonna need it.
"So did the United States.
What do you think deficit spending by 50% for years and years is, while having bases in over 90 countries and involved in overt, covert, and dirty wars all over the globe?
How is it the US has endless money for Ukraine and Israel but wounded warrior project has to build ramps for guys without legs who committed the sin of buying into the lies?
War is the banker's richest harvest. "
Change the subject much?
So, a Bank CANNOT buy a government that isn't put up for sale by a Politician.
Now, about Greece specifically...
It's the Bureaucracy and the political class that is SELLING.
It is the same as/associated with BRIBERY.
Someone can OFFER all they like: but it is the ACCEPTANCE OF THE BRIBE that is the problem.
OFFERING TO BUY IS NOT THE PROBLEM: SELLING IS.
http://davidstockmanscontracorner.com/the-true-cause-of-greeces-economic...
"“Greece, the nation with the debt problem, is currently expecting each employed person to support 6.1 other people above and beyond their own families. This explains much of the pressure to work long hours and also explains the unstable debt loads. Since a single Greek worker can’t possibly hope to support what amounts to a complete baseball team on a single salary, the difference is covered by Greek public debt, debt that the underlying social system cannot hope to repay as the incentives are to maintain the current system of subsidies.”
...
Government institutions are, in fact, designed to grow public sector employment rolls. So as long as this social structure is in place, the odds that a Greek default and restructuring will lead to a sustained Greek recovery are very low.”"
6 TO 1 really. Wow.
That is what is alleged/calculated by Justin Murray as origianally posted at Mises:
https://mises.org/library/greece-reliance-public-funds-central-problem
The link earlier is to Pater Tenebrarum as reposted on David Stockman's site.
Whether or not you agree with Murray's assertion/calculation or with Tenebrarum's embellishment/discussion, I rather doubt that Stockman would allow indefensible math or data to be posted on his site that might embarrass him later.
So much of what we read is re-posted and embellished that it is often hard to track the original source of the underlying data.
I'd appreciate it more if instead of getting into emotional and rhetorical debates we could parse the orginal data source and methodology for accuracy and discuss how the conclusions were drawn and whether those conclusions are reasoned and valid to the discussion...
...& hi there VWAndy. Nice to see ya. Hope all is well with you and yours...
We are all good. Thanks for asking. I hope you and yours are doing well also.
"So Greece, we truly do wish you the best of luck and as you head back to the polls next month, don’t forget, if things get really bad, you can always storm the mint..."
Should read
"So Greece, we truly do wish you the best of luck and as you head back to the polls next month, don’t forget, if things get really bad, you can always vote in the Nazis, Golden Dawn, just like the Germans when they were faced with impossible debts after the first world war. Hitler solved Germany's impossible debt problem by defaulting in 1933. Germany was ready to take on the world six years later, default works much better than austerity. The far right know how to play hardball."
Nazis are/were leftists.
Note "Greece’s state insurance funds are resorting to external loans to cover their needs"
Who in their right mind would be lending to those insurance funds? What are the getting as collateral, . . . a bunch of old Greeks?
No doubt GS, for a nice fee, will be securitizing those new loans and their entitlements to aged Greeks.
Generational Solidarity Insurance Fund (AKAGE)
AKAGE is Greek for " A CAGE "
Seems your article gaining some traction: https://twitter.com/Sir_John_Law/status/636452513584164864
This whole Greece game is SO rigged. There is no way this is ever going to end well. Though Greece being "just a small part" of the Eurozone, this situation simply WILL blow up the euro project in the end, and as a 'side effect' -since our politicians have shown no brains- potentially blowing up the entire EU project as well.
Now THAT is a far too big price to pay.
Instead, I would gladly sacrifice the euro (just ditch it - it's never going to work this way) in order to be able to save the EU political project. I am mad.
Mad as in 'Crazy,' or Mad as in 'Angry?'
Greek economy = US$0.207tn
China economy = US$11.212tn
If projected Chinese growth of 7% falls by a quarter, that represents a greater loss than a 100% loss of the entire Greek GDP. Greece is a side show, it has fewer trade links and everyones been expecting it. Greece would have little impact outside of Europe, China could cause major problems for Asia, Europe (specifically the UK) and South America and until 3 months ago everyone thought it was a ticket to never ending growth.
You are comparing slowing of growth with a possible default on $200B+ and detonation of all the hidden unknown derivatives leverage associated with that default?
Hardly a comparison of like magnitude...
There is a rather large difference between a commuter train slowing down and a full bus plowing into a crowd of people on the sidewalk.
Chinas debt is US$1tn or 282% of GDP according to McKinsey, its behaving exactly like any other emerging market but it also happens to be the first (or second) largest economy in the world.
Again, a 2% write down on Chinese debt would be worth a 100% write down on Greece. Back of the envelope maths but Greece only matters because of the precedent it sets for Spain and Italy.
"If projected Chinese growth of 7% falls by a quarter, that represents a greater loss than a 100% loss of the entire Greek GDP. "
THAT^^^ is what you wrote.
DO You understand the difference between growth projections and LOSSES ?
Slowing of ( 'projected' ) growth is NOT A LOSS.
"Greek economy = US$0.207tn
China economy = US$11.212tn "
The size of an economy is not it's debt.
"Chinas debt is US$1tn or 282% of GDP according to McKinsey
a 2% write down on Chinese debt would be worth a 100% write down on Greece."
By what math did you acsertain that $1T is 282% of $11.212T ?!
By what math did you ascertain that 2% of $1T is larger than $0.207T ?!
YOU NEED TO STOP HITTING THE BONG STRAIGHT OUTTA BED.
China's debt is approximately $28 Trillion!!!
I didn't even bother to question the numbers provided.
It was obvious without even bothering to reach for a claculator that the math claims were false.
The gibberish equating slowing of projected growth and default/loss was just outrageous and pissed me off.
-It's the kind of crap that fast talking salesmen spew at low IQ marks.
IF the guy isn't high he's dangeous to the gullible...
BTFDrachma
remembers me to gails graph to pension funds and other promises increased our depts explained for dummies:
http://ourfiniteworld.com/2015/08/10/how-economic-growth-fails/#more-40062
The Political Promises in the *Eurozone* Pension Ponzi are now revealed to be purely dependent on Can Kicking, and not on any sort of financial reality.
Greece is just the first country where the tide has gone out in the bay of Government Malaise, revealing all the Public Pensioners, naked and flopping in the sun.
It is just a matter of time before the rest of Club Med sees another sea change. Get prepared.
Gubmint jobs...some of the best out there with tons of benefits and many cannot be fired. Very sweet for them while the private sectors have been devastated by Barry, Pelosi and Reed. Rep just sat back and watched. They all need to be voted out and replaced.
Greece is loaded. I'm watching Grecian citizens welcoming foreign boat people on the TV right now.
The Greek TV woman just said, “We have to do more…”.
All new money is created from new debt (loans at banks); new money and debt are opposite sides of the same coin.
But the two items involved, new money and new debt, have very different effects
1) The new money is spent immediately
2) The debt is paid off slowly over the period of the loan, mortgage, etc ...
A boom in new money must therefore have a sting in its tail that lasts for a long time.
Debt has been around 5,000 years and so you would think we would have learnt how to manage it.
Modern economic theory treats money as a medium of exchange that is not important.
This totally ignores the fact that debt reaches a level where people cannot take any more because they cannot afford the repayments (like Greece).
It also ignores the fact that debt accumulates with those least able to afford it:
a) Those with excess capital invest it and collect interest, dividends and rent.
b) Those with insufficient capital borrow money and pay interest and rent.
This is why economists don’t see the sting in the tail of money creation in credit booms and didn’t see 2008 coming.
Bankers only have one product, debt, surely they understand it?
“What is wrong with lending more money into real estate?” Chinese banker last year
"What is wrong with lending more money to Greece?" European banker pre-2010
"What is wrong with a NINA (no income no asset) mortgage?" US banker pre-2008
“What is wrong with lending more money into real estate?” US banker pre-2008
"What is wrong with lending more money into real estate?" Irish banker pre-2008
"What is wrong with lending more money into real estate?" Spanish banker pre-2008
"What is wrong with lending more money into real estate?" Japanese banker pre-1989
"What is wrong with lending more money into real estate?" UK banker pre-1989
“What is wrong with lending more money into the US stock market?” US banker pre-1929
Obviously not, hence the continuous cycles of boom and bust.
The very nature of money causes the problems and our experts don’t understand it.
Visit the positive money web-site for an alternative that will protect us from the ignorance of bankers and economists.
"Debt has been around 5,000"
Greek debt for sure. Greece is still paying for the 447 BC Parthenon.
Thank you...I was getting tired of hearing about Chinese stock market problems...I was wondering..why don't we have more articles about Greece...you have answered my prayers...