I believe I was one of the very few to declare Greece a foregone default in February 2010 (I Think It’s Confirmed, Greece Will Be the First Domino to Fall [12] and then with with more specificity a month later As I Explicitly Forewarned, Greece Is Well On Its Way To Default, and Previously Published Numbers Were Waaaayyy Too Optimistic! [13]).
By the 2nd quarter of 2010 I was one of the very few to clearly and
articulately detail exactly how Greece would default with specific
structures in play- What is the Most Likely Scenario in the Greek Debt Fiasco? Restructuring Via Extension of Maturity Dates [14]. Due to a few institutions who were skeptical, I attempted to make it a bit more real - A Comparison of Our Greek Bond Restructuring Analysis to that of Argentina [15].
Well, Greece defaulted according to plan, despite all of the "people in the know" saying otherwise - Greek Crisis Is Over, Region Safe”, Prodi Says – I say Liar, Liar, Pants on Fire! [16] - from government officials tothe EC and IMF - Lies, Damn Lies, and Sovereign Truths: Why the Euro is Destined to Collapse! [17] Even
after the default, I made clear that this wasn't over for Greece, for
the default actually left Greece worse off fundamentally, not better. Go
wonder... I know I did, reference the warning from 5 months ago [18]:
This will be exacerbated by a
re-default of the Greek debt that was designed to bail out the defaulted
Greek debt. Why will this happen? Greece has severe, rigid structural
problems that simply cannot (and will not) be solved by throwing
indebted liquidity at it. As a matter of fact, the additional debt
simply exacerbates the problem - significantly! This was detailed in the
post Beware The Overly Optimistic Greek Speculators As Icarus Comes Crashing Down To Earth! [19]
... Subscribers [20] can download my full thoughts on Greece's sustainability post bailout here - debt restructuring_maturity extension blog - March 2012 [21]. Professional and institutional subscribers should feel free to email me [22] in order to receive a copy of the Greek restructuring model used to create these charts and come to these conclusions.
Despite extensive, self-defeating,
harsh and punitive austerity measures that have combined with a lack of
true economic stimulus, Greece has (to date) failed to achieve Primary Balance.
For the non-economists in the audience, primary balance is the
elimination of a primary deficit, yet the absence of a primary surplus,
ex. the midpoint between deficit and surplus before taking into
consideration interest payments.
[23]Greece_Primary_balanceGreece_Primary_balance
The primary balance looks at the structural issues a country may have.
Government expenditures have
outstripped revenues ever since 2007 and have gotten worse nearly every
year since, despite 3 bailouts a restructuring, austerity and a default!
[24]Greece_Primary_deficit_copyGreece_Primary_deficit_copy
This situation will simply get worse, considerably worse. I demonstrated in the post The Ugly Truth About The Greek Situation That'sToo Difficult Broadcast Through Mainstream Media [19] that
anyone who purchased the last set of bailout bonds from Greece will
simply lose their money as well (that's right, just like those who
purchased the previous set) since Greece is still running deep in
structural problems and can't afford the interest nor the principal on
its borrowing. It's really that simple.
Well, fastforward to Der Speigel [25] as of yesterday, as I highlight some choice excerpts:
Athens has not been having an
easy time coming up with the €11.5 billion in cost cutting measures over
the next two years it has promised Europe. Indeed, Greek Prime Minister
Antonis Samaras is reportedly set to request an additional two years to
make those cuts...
... the financing gap his
country faces could be even greater. During its recent fact-finding trip
to Athens, the so-called troika -- made up of representatives from the
European Central Bank, the European Commission and the International
Monetary Fund -- found that Greece will have to come up with as much as
€14 billion to meet the terms for international aid.
Methinks the Troika should renew their subscription to BoomBustBlog [20], for early in 2010 I noted their accuracy on the Greek situation [17]...
[26]image005.pngimage005.pngimage005.png
Notice how dramatically off the market the IMF has been, skewered HEAVILY to the optimistic side. Now, notice how aggressively the IMF has downwardly revised their forecasts to still end up wildly optimistic. 
[27]image018.pngimage018.pngimage018.png
Ever since the beginning of this crisis, IMF estimates of government balance have been just as bad...
[28]image013.pngimage013.pngimage013.png
The EU/EC has proven to be no better, and if anything is arguably worse!
[29]image031.pngimage031.pngimage031.png
Revisions-R-US!
[30]image044.pngimage044.pngimage044.png
and the EU on goverment balance??? Way, way, way off.
[31]image040.pngimage040.pngimage040.png
If the IMF was wrong, what in the world does that make the EC/EU?
The EC forecasts have been just as bad, if not much, much worse in
nearly all of the forecasting scenarios we presented. Hey, if you think
tha's bad, try taking a look at what the government of Greece has done
with these fairy tale forecasts...
[32]greek_debt_forecast.png
Alas, I digress. Back to the der Spegiel article...
According to a preliminary
troika report, the additional shortfalls are the result of lower than
expected tax revenues due to the country's ongoing recession as well as a
privatization program which has not lived up to expectations. The
troika plans to calculate the exact size of the shortfall when it
returns to Athens at the beginning of next month.
I'm sorry, but I simply cannot resist. This article was posted on BoomBustBlog in July of 2011 - Greek Asset Sales Fall Short, As We Virtually Guaranteed They Would In Spring 2010 [33].
In it I reviewed how the BoomBustBlog team detailed EXACTLY how
bullshit the privatization plan was, in explicit detail - in the spring
of 2010. THAT WAS MORE THAN TWO AND A HALF YEARS AGO, PEOPLE!!!
If a blog can have this much foresight, with this much specificity,
than what does one make of this so-called troika??? As excerpted:
This is a tragic Greek comedy. Professional/institutional subscribers should reference the 
Greece Public Finances Projections 2010-03-15 11:33:27 694.35 Kb in its entirety [34].
For those who chose not to subscribe, I am posting excerpts from pages 5
and 6 from said document, don't read this while eating or drinking for
fear of spitting up your lunch!
[35]
[36]
Any subscribers who would have went heavily bearish into these banks when I first commented on the would have done quite well:
[39]
Okay, I digress - yet again... With such excessive bullshit, one does
tend to get thrown off track. Back to the der Spiegel excerpts...
The news of the potentially greater financing needs [40] comes at a sensitive time for the country. Many in Europe, particularly in Germany, are losing their patience [41] and
there has been increased talk of the country leaving the common
currency zone. Over the weekend, German Finance Minister Wolfgang
Schäuble reiterated his skepticism of additional aid to Greece. "We
can't put together yet another program," he said on Saturday, adding
that it was irresponsible to "throw money into a bottomless pit."
Well, my friend, if you had that BoomBustBlog subscription [20],
you would have known before you spent that first euro that Greece was a
bottomless pit. Let me reiterated what I pasted up top... This situation will simply get worse, considerably worse. I demonstrated in the post The Ugly Truth About The Greek Situation That's Too Difficult Broadcast Through Mainstream Media [19] that
anyone who purchased the last set of bailout bonds from Greece will
simply lose their money as well (that's right, just like those who
purchased the previous set) since Greece is still running deep in
structural problems and can't afford the interest nor the principal on
its borrowing. It's really that simple. And guess what? Anyone who dips new money into Greece now will suffer the EXACT same fate!
As excerpted from Greece Sneezes, The Euro Dies of Pneumonia! Yeah, Sounds Bombastic, Yet True! [42]
Wait until a 2nd Greek default (virtually guaranteed [19] as
we supplied user downloadable models to see for yourself, the same
model used to forecast the 1st default) mirrors history. Of the 181 yrs
as a sovereign nation after gaining independence, Greece been in default
58 of them. Don't believe me! Check your history, or just read more
BoomBustBlog - Sophisticated Ignorance Or Just A Very, Very Short Term Memory? Foolish Talk of German Bailouts [43]Once Again [43]...
[44]image022image022
Greece's default will hit an already bank NPA laden Spain quite hard: The Spain Pain Will Not Wane: Continuing the Contagion Saga [45] and ditto with Italy "As We Assured Clients Two Years Ago, Italy's Riding The Broken Promise Express To Restructuring [46]".
Once Italy gets hit, the true bank runs will start as socialist France
(the so-called half of the EU anchor) loses control of its bankinsg
system. Reference "As The French Bank Runs.... [47]":
Saturday, 23 July 2011 The Anatomy Of A European Bank Run: Look At The Banking Situation BEFORE The Run Occurs! [48]: I detail how I see modern bank runs unfolding
[49]image012