The money for Greece has not yet been wired, and already a deeper dive into the previously released Troika report [12]shows what is glaringly obvious to anyone who follows the actual collapse of the Greek economy: that the country is already on course to miss its budget targets for the immediate future (for insane EU assumptions on what the Greek economy should look like through the lens of a Eurocrat, see our chart of the day [12]). The Telegraph reports [13]: "Athens has probably cut spending enough to bring its primary deficit down to 1.5pc this year as agreed. But "current projections reveal large fiscal gaps in 2013-14" according to a leaked draft report by the European Union (EU), the European Central Bank (ECB) and the International Monetary Fund (IMF). In its report, the troika said Athens will have to impose further fiscal cuts of as much as 5.5pc of GDP to meet next year's targets." And while Europe may be terminally fixed, translated this means that the aborigines of the southern colony of Bavaria Sachs will see their wages cut even more, and even more people will be unemployed soon just to appears the first lien debt holders. This in a country of 10.8 million where just 36% [14]of the population works. So Greece, which today received a rare bit of highly irrelevant but good news, when Fitch became the first rating agency to upgrade the country's credit rating from Default to B- (even as its new bonds saw their yield surge to 19% [15]on the second day of trading), will in a few short months be forced to once again deal with even more consequences of being the proud recipient of the inverted European bailout, whereby the country's gold is used to fund Eurobank capital shortfalls.
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The report says that "substantial additional expenditure cuts will have to be announced and adopted by Greece in the coming months, in particular when Greece updates its medium-term budget in May 2012".
"The recovery previously announced for next year will be further delayed with, at best, a stagnation of activity in 2013," the report said.
Even so, the report, which is called "The Second Economic Adjustment Programme for Greece", paves the way for Greece to receive the first tranche of its new bail-out in the next few days. Athens needs the cash injection to repay a €14.5bn bond due on March 20.
However the troika report threatens a repeat of the lurches markets have suffered in the run-up to each disbursement of Greece's €110bn first bail-out.
So... does that mean that the Troika's worst case scenario of flat GDP in 2013 can be used as kindling? Or will the Greeks be forced to pay the carbon tax credits for that particular combustion as well?