More Leaked Greece Details: Downside Case Sees Funding Needs Soar From €136 Billion To €245 Billion
The FT's Peter Spiegel has scoped up some additional details from the 10 page debt sustainability analysis that is at the basis of the latest Greek bailout talks. Some of the critical details:
- "even under the most optimistic scenario, the austerity measures being imposed on Athens risk a recession so deep that Greece will not be able to climb out of the debt hole over the course of the new €170bn bail-out."
- A German-led group of creditor countries – including the Netherlands and Finland – has expressed extreme reluctance since they received the report about the advisability of allowing the second rescue to go through.
- A “tailored downside scenario” prepared for eurozone leaders in the report suggests Greek debt could fall far more slowly than hoped, to only 160 per cent of economic output by 2020 – far below the target of 120 per cent set by the International Monetary Fund
- Under such a scenario, Greece would need about €245bn in bail-out aid, nearly twice the €136bn under the “baseline” projections.
- “Prolonged financial support on appropriate terms by the official sector may be necessary,” the report said, a clear reference to the possibility that bail-out funds may be needed indefinitely.
- Even in best case scenario country will need at least €50 billion on top of €136 billion.
- A recapitalisation of the Greek banking sector, which originally was projected to cost €30bn, will now cost €50bn. A highly touted Greek privatisation plan, which originally hoped to raise €50bn, will now be delayed by five years and bring in only €30bn by the end of the decade.
Translated, this is yet another confirmation of what we have claimed all along - that Germany is no longer playing along.
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Oooo pa
Sick and tired of the Greece 'news'. Although, I have to say... I want a gyro right about now.
Why do they continue to lie?
Why don;t they simply come out and say what everyone else already knows...
They have no fucking idea how much it'll cost to bail Greece out.
Don't worry, everybody. Benny will come to the rescue in 3..2..1...
Bernanke? He is priced in. Priced into a rock and a hard place.
I'm afraid to say anything in fear of getting detained or assassinated. It'd be a bummer, too, because the economy's really starting to pick up and I don't want to miss the good times. /sarc off
Ich Bin Ein Benign!
Let's see: debt + more debt = ?
a fuking 4 year old could work this one out
Politicians & Bankers : the village idiots of society for thousands of years
..let them struggle on
Unfortunately, they don't struggle at all. If they were truly struggling, they might actually come up with a solution. Instead, they just slowly pile more and more of the burden on the back of the productive in society.
"10 page debt sustainability analysis "
That's the ticket to prosperity.. sustainable debt.
Even if the model is right, the paradigm is wrong.
WonderDawg - i'm watching students protesting in Valencia on Spanish TV at the mo ...they're wearing jeans and jackets while the State Police are dressed like Judge Dredd and beating some of them up with big battons. It's only a matter of time before the Police claim one of them has been 'injured' by these unarmed kids, or "rioters" as the State will call them
Anyway if this is what it's like before Spain goes tits up (and Greece before it institutes austerity on the still fattened bloated 50 stone pig that is the Greek Govt) then God help us when the real fireworks start!
ZeeGee, I think it is going to get very ugly, in Europe and ultimately in the US. All this focus on Greece and Europe has taken our eyes off Japan, and China, as well. Then there's MENA. Everywhere you look, it's fucked up. The hostile mood is building, and when it reaches a crescendo, all hell is going to break loose. But maybe that's just me and my sunny outlook.
maybe "all hell breaking loose' is not to be feared (rioters don't go for Joe Public) but is societies antidote for ridding the cancer (that is Govt)
it's our way of saying we've had enough, time for Regime Change
this is an opportunity not to be missed if it can be used eradicate the sewer that is Govt and its behind the scenes monopolists
public sector workers are afterall kicking off against the public sector Chiefs. Maybe the penny will drop the private sector is where productivity/wealth comes from and it was Govt all along conning them with false promises of the Holy Land
Fingers crossed
Keynes would say:
debt + more debt = higher GDP.
Q.E.D. (problem solved)
Keynes did his job as a hired Govt consultant (crone) and underlined the political policy he was hired to underline
as a very sound stock investor he'd easily recognise the stupidity of a company deeply in debt not trying to solve the issue of high debt and low growth/profitability by digging itself even more in debt
I doubt even Larry Summers believes privately half the total shit he's hired to talk in public
If I met Summers in public, I would take a run at him and land my fist on his jaw and hopefully break it! If it did not break, I would find the nearest physical object to crack his jaw again until it broke!
As has been stated many times, and not just pertinent to the Greek situation . . . the longer this takes, the more it will cost. Cost in financial term, cost in personal pain, cost in more and more limited options.
seems like a pretty big assumption that "fixing" the situation was ever the goal. most likely, the opposite is true.
There is no "fixing" it, unless you mean wiping it clean and starting with a new system.
The goal has always been to kick the can. That's all they have.
That's what I'm wondering! When will the market wake up and get wise to bloomberg's bullshit and reuter's one sided ranting? None of the stuff being shared on zero hedge even shows up there. No real picture scenario.
Here's bloomberg's headline!
Greece Moves Toward Second BailoutHere's reuters headlines!
Second Greek bailout in reach, funding gap narrowsMaybe they actually believe this will be solved one way or the other....even if by force. It seems the public protests are doing nothing to sway the determination of the governments to sell out the country to the banks and the Euro.
"Maybe they actually believe this will be solved one way or the other....even if by force."
No....they are HOPING
The only thing that 245 billion euros is going to buy is just a little more time.....
And time....is becoming more expensive after each funding round....
Let's just get Greece over with... So we can begin another long road with Portugal...
Perhaps they want the market to become numb to all this because after Greece the real unwind begins..
Portugal
Ireland
Italy
Spain
France
Germany
Uk
USA
I am openly endorsing 'The Krugman Plan,' right here and now, bitchez.
The ECB should print €17 trillion to €26 trillion and use it to pay off PIIGS+France current debt (the debt that shows up on the cooked books - the actual debt, just as in the UK and US, is many, many multiples higher), which will leave a few trillion € left over to fund the government sector and political class of these debt fiefdoms for the next 1 1/2 to 2 years.
Then, they can repeat this process every few years.
On top of that, have the ECB be the buyer of last resort on all future bonds issued by PIIGS+France, at the lowest possible yield.
What could possibly go wrong?
If Krugman says imposing austerity would be akin to withholdng heroine and/or methadone from a junky in withdrawal, and that you double the dose of heroine and/or methadone, don't argue.
Fixing the fundamental flaws that led to the current situation is not the critical or even an important thing.
Kicking the can while debasing living standards is the important thing.
How hard is this shit?
You all flunk Kruganomics 101.
J.M. Keynes on inflation in The Economic Consequences of the Peace (p. 235-6)
Alan Greenspan
written in 1966
i second that.... Greece the 51st US state
I've got a better one. The Central Banks should give every household a printing press. All problems solved.
Krugman wrote a letter to The Bernank urging him to prod congress & the POTUS to pass legislation funding installation of Federal Reserve Note dispensing ATMs in all households.
That would lead to the greatest economic expansion in human history according to Krugman.
This Greenspan guy sounds pretty badass. What is he up to nowadays?
Hoping that if he lives long enough to go through the collapse, that everyone will believe him when he says "I did it on purpose so we would have to start a new system!".
Add a -0- maybe -00-
It'll be interesting to see how much more the banks will loan them. Looks like they haven't got much else to loan and Greece can't borrow much more because all wealth for years is already spent. The question is, will Greece allow itself to become a serf territory or will it throw off this debt with default and then fight itself to become free?
If I had to pay my taxes in Germany,
I'd ask very tough questions about whether
they're putting my kids on the hook
for this "bottomless pit" !!
Let them corrupt goat herders go, PLEASE !!
I know, the cost keep going up and up and Germany is saying let them default now. There is no way that Greece can increase there GDP with the economy in the country the way it is and most people in the poor house.
In support of Greece I used Kalamata olives on my nachos tonight. Unfortunately, just noticed they were made in Napa. Close enough.
Double down, bitchezzzz. Go big or go home, signed
The PEOPLE OF GREECE!
Exactly....this is all just gamesmanship to compel the US to pony up more to the IMF and continue printing.
Hey Ty can we claim a Greece extro default in a specified timeframe? Cause we been claiming this shit for quite some time, and yet there float the hopium on top of the optimismo crackle ad infinitum it seems...
What does ANY of this have to do with these "front page" MSN "Editor's Picks"??
I mean, come on people...Mary Kay's pink home is for sale!!!
I've noticed a glitch in the Matrix lately, though. I like to keep up on pop culture because I like to make sure I can mock it, and so I read Yahoo headlines every few days. Today, trending with Brittney and Whitney and Clitney and a bunch of other bozos, was....Rob Paul. I have seen gold prices on there a lot lately, too.
So it looks like the splinter in the status quo's mind is starti ng to itch, a lil' bit.
Rob Paul...lol.
...and when they get Obama's name wrong, there's an all-out 3-day NAACP media blitz lead by AL Sharpton...go figure.
Woops, meant Ron. But yeah, can't mess with Darkness.
LOL
Oh fuck.
Not again.....
$TVIX Long
Pshaw, c'mon, it's priced in. Priced in bullishly! DJ 14k in no time. No time!!!!!
Methinks you're being too bearish. Just look around you, Hendrix. Our economy is BOOMING!
DJIA 16K no time. Record highs.
Meanwhile, we'll be paying $6 for a gallon of gas and $7 for a gallon of milk in the US. But fuck yeah!! The DOW will be going THROUGH THE ROOF!!!!
Please cover the eyes of children and women of delicate sensibilities. Emperor is naked.
$245B..is that all?
just transitory
There is only one course of action.
Whoever prepared that sustainability analysis will be accused of rape by a maid at the hotel where he is staying. He'll be removed from his analysis position and replaced by someone who predicts different, more palatable numbers.
It is a lady.
Kinky.
Not if the rest of the world is going to pay. That's the usual tactic of extortionists. Or should this be called "racketeering"?
Shit, I,ve got that much on me.
The writers of the sustsainability report want more concessions from central banks. The political goal is clear.
Sell-off Bitchezzz!!
Pony up assholes . Ink is cheap .
Okay, I don't get it. The Dutch and Finns (and Germans) didn't know about this report until now???
Bullshit !!!
They have to pretend, so they can have a few more days to think about it. Just a few more days....
Why would they then risk upsetting their precious markets by delaying when clearly EVERYONE is/was expecting an announcement tonight?
There's more that meets the eye here....
Everyone has been expecting an announcement for months! You think one more delay will derail everyone's hopes of a bailout?
Yes.
Sorry, I wish it were true, but people are numb to this shit, and the markets don't give a damn either way, HFTs and PPTs will propel the no volume markets higher.
Exactly...Is this a new report just today???/
Germany's pimp hand is strong .
Powdah!
LOL
C'mon you balless fools. Get your Drachma back devalue and create the tourism industry that will be the biggest in EZ. You will come out of the crisis quicker and not look back. Yes, like Iceland.
Or, Holland will push for a Troika base camp/occupy Athens (permanently). You want that? Grow balls. And stick it to the idiots and the ECB/IMF and EU.
Or Athens will burn again, again, again...
drachma=hyperinflation 3 years tops
Where Greece is now in a greater depression. Nah, that could manage it. What is worst is the ECB/central banks make oil bid thus creating inflation and a spec market. So you have exterme stagflation hitting Europe. They whole EU should take a major depression, kick out the PIIGS, they devalue, manage their own destinys. Greece bounces back on a tourism high. A depressed market would knock oil down. But we have the doomsday inflation machines working over time, that being the central banks.
Is it just me or is this whole charade to keep Greece in the Euro basically so that Portugal, Italy, Spain, Ireland don't get any ideas (like you can actually rebuild after default)? Or is it that they know when the CDS cannot pay up the worldwide derivative ponzi will be marked to market (zero)? Meh, probably both. Tell me again what is wrong with running a sound money regime so you don't run into these issues?
OT:
Hmmm, IRS to provide help to victims of Ponzi Schemes
http://www.irs.gov/newsroom/article/0,,id=205505,00.html
I think so, the PIIGS could all devalue, go back to the currencies. CDS's implode, who cares a f*ck. They (PIIGS) create they own trades, industries, they can re-set their economies. Let the Ponzi collapse. History lesson: Late 1970's early 80's US economy was bad, real bad. One city that was booming was Miami, ok, it was cocaine that was booming the city. But, point is, they created their own banks, loans, developments, all disconnected from the wider US economic woes.
The EU is an interconnected failure.
The real charade is that the bankers don't give a fig about Greece. Everything they do at this point is Greed + Self Preservation. Greece is a distraction to keep your eyes off of the sick reality. The Fiat Money System has entered the parabolic stage.
The Banking Cartel are not coming up with endless delays and half-baked plans by accident.
They simply have no choice.
It's going to be all rumours, lies, printing, deception, more printing, etc from here on out.
Come a few months later, elections will either be postponed by a coup or the greek people will have their say. Ex majority party is down to 13%, opposition to 20%. Past election they were adding to 45%..
PS: Second world war, italy demanded the surrender of greece. The answer was no. Italy lost the fight and germany came to the rescue. If the people in power now were back then in charge, they would have pontificated on the wise choice to surrender.
http://www.reuters.com/article/2012/02/20/us-greece-poll-idUSTRE81J1G320120220
Just posted on ZH twitter feed. It's basically a commentary of your commentary. You seem to be correct.
Why doesn't Goldman Sachs simply carry Greece on its balance sheet ? It could then stuff it to retail investors as a recovery opportunity. Goldman has a track record in offloading crap onto retail investors and as a Bank Holding Company it could do great things with its Greece subsidiary and set up fancy derivative trades
This is a good one. Kudos.
The speed of how their financials are failing is a serious red flag folks...let er go..cut the line...pull out now...this would be the stupidiist thing anyone could do would be to give them more money....I mean come on people...its over...its dead
Last time ZH made the calc, only 19c /euro went to Greece. The other 81c/euro went back to german, french and dutch banks to pay for the interest, otherwise kaput (which is inevitable anyway)
And mostly French banks. Sarkozy is going to have a wild time getting reelcted if Greece doesn't roll that debt!
I don't know. Sarko is the 2nd in a row from the right wing (so to say since they're all socialists). Jacques Chirac of the same party won twice in row before him.
I'd say that the socialist Hollande will win just because it's the socialist's turn. However, Le Penn is wild card. She's campagning on (almost) quitting the euro.
The french system is typical european. If no one wins more than 50% in the first round, than the first two go for another fight two weeks later.
this is part of the propaganda - this kind of bailouts always function this way
if you owe your sister 100 bucks, and I bail you out by paying your sister 100 bucks, zero bucks go to you.
the real problem is the compound interest - and nobody has an interest to make propaganda against that
This market is schizophrenic.
Which market?
The concept of market is "willing participants". Right now it's just the primary dealers and the brokers they own who are trading against each other. Who would be so idiotic to even think of entering this farce?
http://www.economist.com/node/21547809
http://ftalphaville.ft.com/blog/2012/02/20/887721/hedge-funds-exit-stage-left-pursued-by-bearishness/
Here's some proof for you. Even hedge funds are changing their legal terms since quote "we don't know what's happening" and quote "there's nothing to hedge against".
How about the rational consumer? Where do they fit in?
For a real expert answer, read Steve Keen.
My answer: A consumer is as rational as man looking at some nice round boobs.
Have you seen women looking at shoe stands?
How much for the boobs?
Please DO NOT get my imagination started. Round rear and round boobs make me quite irrational.
true .. its like a show with the politicians writing the script and the central banks acting as the director. who is putting risk on the table? banks are just broking each other .. real money are sitting like deer in headlights .. retail punters dont know any better and are messing around the edges. market (they are all just one big market really) are being played like a 6 piece band .. central bankers post 08 instead of reining back on financial engineering have stepped it up BIG TIME!
Thx for the input.
And the media keep saying that the Fed is independent. And people believe it!!!!