Greek Bank Deposits Decline For 7th Month In A Row: Tax Collectors Celebrate By Striking

We now know that the US is an Onion Republic, which leaves open the question: what is Greece... because we are getting very vegetably challenged here. According to the Bank of Greece, household and corporate deposits declined for the 7th month in a row, dropping by €1 billion euros in the July. Since January 2010, total deposits have declined from €233 billion to just €187 billion, or €46 billion, or 20% of the entire deposit base. Once again, we make it very clear that no matter what the government does with sovereign tax collections, spending cuts and stop gap liquidity boosts, as long as the deposits outflow continues, nothing else matters. And speaking of tax collections, according to Dow Jones, completing the unbelievable Greek farce, is the news that tomorrow in addition to the now standard customs officials and taxi drivers, among those striking will be the country's tax collectors as well. So.... just how will Greece collect those so very precious taxes it needs to pretend it is in compliance with the Troika's demands for deficit cut compliance in order for the country to get the next IMF tranche which will stave off bankruptcy for one more month. As a reminder, Greek cash runs out on October 17.

Total Greek deposits:

Dow Jones on the (even greater) joke that Greece has become. We expect an all out revolution shortly.

Thousands of Greek tax collectors and customs officials walked off the job Monday in the first day of a two-day strike over plans to cut civil service salaries, the latest in a string of protests over Greek government reforms.


They were joined by taxi owners, who have called their own two-day walk over plans to liberalize taxi services, and garbage collectors in the capital, Athens, who are staging a separate 48-hour strike over local government cutbacks.


"The participation rate in the strike is over 90%," said Yiannis Grivas, head of the tax collectors' union, or POE-DOY. "The workers are striking to protest the looting of their income."


Greece's embattled government is scrambling to cut public spending and step up its reform drive amid stark ultimatums from other euro-zone governments that further rescue money will be withheld if Athens doesn't deliver on promises.


Among the reforms is a plan to revamp the wage structure for public-sector workers--a move widely seen as leading to further cuts in civil-service wages following steep cuts in their salaries last year.


"We are talking about cuts to our income of 60% over the past one and-a-half years--30% last year and 30% this year with the new wage structure," said Grivas. "Of course we are obliged to protest."


The strike comes just a day after Greece said it would impose a new property tax to cover a EUR2 billion euro shortfall in its deficit targets this year.


That tax will be collected through a special levy added to monthly electricity bills--a collection method that both the government and the tax officials' union agree is more efficient than Greece's dysfunctional tax service.


However, the tax, coming on top of a raft of recent revenue measures, may yet face its own problems. One potential spanner in the works is the militant power sector workers union, Genop-DEH.


In a statement, Genop, which opposes the new property tax, said it will not allow state-owned national electric utility, Public Power Corporation SA (PPC.AT), to act as a surrogate tax collector, and it will block collection of the new tax.


Of more concern is opposition from the wider public who have seen their taxes rise sharply on everything from gasoline to cigarettes to personal income. Senior Greek officials say they fear that many taxpayers may simply refuse to pay.

Total, unprecedented, unbelievable chaos.