Despite cautious optimism earlier last week about reaching a deal, the talks have suddenly derailed after Greek Prime Minister Alexis Tsipras announced he would organize a referendum in Greece about whether or not accepting the proposal from the three institutions. Strange enough, Tsipras received a standing ovation from his coalition partners when he arrived in the Greek parliament earlier today (see next image)
This was a huge surprise as this basically was sticking up another middle finger to the European Institutions. By instating a referendum (to be held next Sunday), Tsipras tried to accomplish two things. First of all, he wanted to arm-wrestle the institutions into giving Greece an extension of a few weeks (which obviously didn’t work), but secondly it also looks like he was trying to cover his (political) ass by putting the responsibility of the decision on the shoulders of the (uninformed) citizens.
Indeed, uninformed. Not only have the Greek citizens been influenced by demagogic statements (‘the three institutions only want to humiliate the Greeks (and Greece as a nation) and don’t care about an honest solution that works for everyone’), but on top of that, the question which will be asked at the referendum also isn’t really worded very fair. According to our information, the only question on the ballot will be ‘Do citizens of Greece reject the proposal by the three institutions? Yes/No’ and someone should call Tom Cruise because it will definitely be a ‘Mission Impossible’ to educate the Greek citizens about what exactly the proposal was about.
Even if we ignore the legal aspects of calling a referendum (our sources tell us a referendum can only be called on matters of national security and not for foreign relationships), it wasn’t just the Eurogroup and us who were surprised, the Greek population was also caught by surprise and a new bank run started on Friday night already.
Things only got worse on Saturday as several reports and images have reached us of tens of people are queuing at the ATM’s of the country and ‘several hundred’ (almost 10% of the) ATM’s all over Greece are now empty (see previous image), despite the Greek national bank stating the ATM’s are replenished ‘smoothly’. The Greek citizens obviously don’t trust the situation and if the current bank run continues, we expect some banks to be closed on Monday unless the ECB makes more funds available – which it refused to do on Friday.
Something WILL have to happen, and the ECB has called an emergency session on Sunday. If no agreement can be reached before Monday, we expect several smaller banks in Greece will have to keep their doors closed for the public. Pensioners are standing in line to withdraw their entire pension (which was deposited yesterday), and it looks like people will start to hoard cash. It would be very interesting to see some updated numbers on the demand for gold from the Greek citizens
The tension is rising on the streets of Athens and Thessaloniki and if the banks shut down on Monday, the always hot-tempered Greeks could be on the verge of rioting. Several European countries have already emphasized tourists need to bring a sufficient amount of cash money if they plan to travel to Greece, indicating a disruption of the complete financial system is a very realistic possibility.
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