Greece starting BANK RUN?
Greek banks seek more aid as savers withdraw €10bn deposits
April 8 2010 By Kerin Hope in Athens
Greece's four biggest banks are seeking help from the government after savers took €10bn (£8.8bn) of deposits out of the nation's financial system.
The flight of money from domestic deposits reflects growing anxiety among wealthy Greeks about keeping their assets in the country as its debt crisis has escalated.
In the first two months of the year, local savers transferred out of Greece deposits equal to about 4.5 per cent of the total in the banking system, the central bank said.
George Papaconstantinou, finance minister, said that the banks had now asked for access to the remaining funds of a €28bn government support plan.
Greece's four biggest lenders - National Bank of Greece, EFG Eurobank, Alpha Bank and Piraeus Bank - have requested access to about €14bn in loan guarantees and €3bn of special bonds that could be used as collateral to borrow from the European Central Bank.
The banks' request came as interest rate yields on 10-year government bonds rose to a fresh record.
Share prices of Greek banks on the Athens stock exchange fell by more than 4 per cent yesterday, following a 3 per cent decline on Tuesday. The decline was triggered by news that the banks had resorted to applying for the remainder of the state package, analysts said.
Many savers chose to move funds to their banks' subsidiaries outside Greece - including Cyprus and Luxembourg - rather than switch to foreign institutions, said one Athens-based private banker. Others transferred funds to local subsidiaries of foreign banks.
The transfers reflected "anxiety among wealthy Greeks about keeping assets here given the increasing uncertainty", said the banker. "We expect the funds to return swiftly once the crisis is resolved."
Another banker said sizeable deposit sums had been withdrawn to buy high-yielding Greek government debt and companies had used cash held on deposit to pay for imports. But several dismissed rumours of savers withdrawing cash in large-denomination notes to put in safe deposit boxes.
ECB funding for Greek banks rose from €40bn to €65bn in the first quarter, according to IOBE, an economic think-tank.
Have to register on this site, but someone posted the article in full on GLP, which is where I copied it from. ft.com
Greek banks hit by wealthy citizens moving their money offshore
5 April 2010, by Harry Wilson (Telegraph.UK)
GREECE earthquakes, volcano
Posted <*))))>< by
ZionsCRY NEWS with Prophetic Commentary
Greek banks seek more aid as savers withdraw depositsGreek banks seek more aid as savers withdraw €10bn deposits
Greece's four biggest banks are seeking help from the government after savers took €10bn (£8.8bn) of deposits out of the nation's financial system.
The flight of money from domestic deposits reflects growing anxiety among wealthy Greeks about keeping their assets in the country as its debt crisis has escalated.
In the first two months of the year, local savers transferred out of Greece deposits equal to about 4.5 per cent of the total in the banking system, the central bank said.
George Papaconstantinou, finance minister, said yesterday that the banks had now asked for access to the remaining funds of a €28bn government support plan.
Greece's four biggest lenders - National Bank of Greece, EFG Eurobank, Alpha Bank and Piraeus Bank - have requested access to about €14bn in loan guarantees and €3bn of special bonds that could be used as collateral to borrow from the European Central Bank.
The banks' request came as interest rate yields on 10-year government bonds rose to a fresh record.
Share prices of Greek banks on the Athens stock exchange fell by more than 4 per cent yesterday, following a 3 per cent decline on Tuesday. The decline was triggered by news that the banks had resorted to applying for the remainder of the state package, analysts said.
Many savers chose to move funds to their banks' subsidiaries outside Greece - including Cyprus and Luxembourg - rather than switch to foreign institutions, said one Athens-based private banker. Others transferred funds to local subsidiaries of foreign banks.
The transfers reflected "anxiety among wealthy Greeks about keeping assets here given the increasing uncertainty", said the banker. "We expect the funds to return swiftly once the crisis is resolved."
Another banker said sizeable deposit sums had been withdrawn to buy high-yielding Greek government debt and companies had used cash held on deposit to pay for imports. But several dismissed rumours of savers withdrawing cash in large-denomination notes to put in safe deposit boxes.
ECB funding for Greek banks rose from €40bn to €65bn in the first quarter, according to IOBE, an economic think-tank. from ft.com
Greece asks EU-IMF for rescue loansGreece asks EU-IMF for rescue loans
April 24, 2010
Greece has formally asked for the activation of an EU-IMF financial rescue package to help pull the debt-ridden economy out of its crisis.
It had hoped that just the promise of EU support, agreed last month, would have been be enough to reassure markets and help its recovery.
But Greece's problems have continued to hit investor confidence in the euro and other European economies.
Eurozone countries will now provide tens of billions of euros in loans.
On Friday evening, several thousand protesters took to the streets of Athens to demonstrate against further austerity measures.
Earlier this month, a deal was agreed under which eurozone nations would provide emergency loans of up to 30bn euros ($40bn; £26bn) in the first year, with a further 10bn euros coming from the International Monetary Fund (IMF).
The European Commission and the IMF said they were optimistic that the exact details of a loan could be worked out quickly.
However, in Germany, where there has been public opposition to funding a bail-out, Chancellor Angela Merkel said any aid would come with "very strict conditions", including a credible savings plan.
A German finance ministry official, Joerg Asmussen, said his country was doing its bit. "The German side is ready to act with its part of the aid package. I cannot say anything about the time frame, but originally it should need some two weeks," he said.
Greek Prime Minister George Papandreou, on a visit to the Aegean island of Kastellorizo, said the markets had not responded positively to the austerity measures designed to reduce the country's debts, as he had hoped.
Confidence in the Greece economy has continued to fall, pushing its cost of borrowing to record levels in recent days.
It was therefore now a "national and pressing necessity" to access the EU-IMF aid, he said, and he had asked Finance Minister George Papaconstantinou to make a formal request for the loan plan's activation.
"Our partners will decisively contribute to provide Greece the safe harbour that will allow us to rebuild our ship," added Mr Papandreou.
Greece has sent a letter to the European Commission, the European Central Bank and the Eurogroup representing other Eurozone countries "formally requesting the activation of the support mechanism".
For non-eurozone senior officials, the Greek problem looks manageable. They just wish everyone would get on and manage it
There are still some hurdles to clear though.
The German opposition SPD is demanding a full debate on their portion of the aid package which could delay any German contribution.
So the IMF may be called on to finance the first portion of the aid. The next immediate step will be for eurozone ministers to agree an interest rate for loans to Greece - which will be considerably lower than the 8% they are facing on the open market at the moment.
The BBC economics editor Stephanie Flanders said for non-eurozone senior officials, the Greek problem looked manageable. They just wished everyone would get on and manage it.
She said the clock was now ticking and several countries needed to get parliamentary approval for the plan, which would take some weeks.
She added that delays had already pushed up the amount needed to support Greece, and further pain could be in store.
The euro rallied in late Friday trade, ending in New York 0.6% higher at $1.33.8.
The yield, or interest rate, on Greek 10-year bonds, fell to as low as 7.99% after Mr Papandreou spoke, after rising to nearly 9% on Thursday - its highest level for more than 10 years. It then crept back up to 8.66%.
The fall is a sign of a slight increase in confidence in Greece's ability to pay back its loans. But analysts said there was still significant uncertainty ahead.
"The market's relatively modest reaction to the news that Greece was formally requesting aid from the EU and IMF was a clear sign that the market still believes that Greece will be forced to restructure its debt even with a bail-out," said BNY Mellon's Simon Derrick.
"These concerns were hardly soothed by a comment from the European Commission that it was neither for nor against a restructuring."
In addition, attention has also been turning to other eurozone countries with large deficits in recent days.
BNY Mellon pointed out that Portugal had come under pressure on the markets this week, with the cost of its borrowing rising.
It also remarked that some investors had begun to pull out of investing in Portuguese debt in recent days. "It seems clear which domino currently looks in danger of falling over on the European table," Mr Derrick said.
But one of the members of the European Central Bank Governing Committee, Ewald Nowotny, said Greece's problems should not unsettle other eurozone countries.
He said: "The fiscal situation of, let's say, Spain and Portugal, cannot be compared with the situation of Greece. It should be made very clear that there is no economic basis for negative news about these countries and it should also show very clearly that we do no want to give space for speculation."
The EU-IMF loans package has been put together to help pull Greece out of its debt crisis.
Greece is swamped by 300bn euros of debt and needs to borrow about 54bn euros this year alone.
In the middle of April finance ministers of the eurozone nations agreed to provide up to 30bn euros in emergency loans for debt-hit Greece should it ask for them.
At the time they offered a three-year financing programme at interest rates of about 5%, based on IMF formulas.
Meanwhile, spending cutbacks being introduced by Athens to restore its finances are being resisted.
On Friday, Greek riot police fired tear gas during unrest as about 2,500 people marched through the streets of central Athens in protest at the country's austerity measures in the latest display of public opposition.
Greece is NWO Test GroundGreece is NWO Test Ground
February 11, 2010 henrymakow.com
"All men of power here, get their power from plundering the Greek people, or having connections with those that do it."
I am 26 years old and live in Greece. I am writing this letter in order to let you know about a new law in Greece announced yesterday.
The financial minister of Greece announced yesterday that from 1/1/2011 all financial transactions of sums above 1500 euros in cash, will be banned. For any transaction above 1500 euros, only credit cards and checks will be legal. The formal explanation for this law is it will combat those who do not pay taxes. But we all know this is not the case...
It seems the new world order wants to make Greece a testing ground for their new laws. For the past months, Greece have been attacked without mercy. We have been called liars, frauds, cheaters, thieves. They are threatening us constantly with banning from the euro zone and default. [These charges are] not true. ... The problem is, based on their accusations and (the virtual) bad situation of Greek finances, they will pass their experimental laws of their new world order.
The fairly new Government of the socialist party, elected 4 months ago, forgot all its promises, and is determined to pass laws giving citizenship to illegal immigrants after 5 years, without any trade-off. We are 10 million Greeks here, and almost 3 million mostly illegal immigrants, who will obtain Greek nationality and will gain the right to bring their families here too... In Pakistan there are even ads saying "for 5000 euros we get you to Greece, to study free, work, make families, and obtain EU passports"...
And now this... The previous government created a new ID card, to collect data from people since childbirth. This government will ban transactions in cash over 1500 euros, in order to make all of us have credit cards. The obvious first step is to ban all cash transactions, then merge this new ID card with the credit system, then, well.... insert this merged ID card into our bodies...
Our peoples' morale is low, society is disorganized because of immigration and propaganda, and we will not fight those laws. You people living in the Western World, be prepared because they are planning the same for you!
I will try to give you my personal view of the conditions in Greece.
First of all, there is no trust in politicians. Most people distrust them and know they are scum, but continue to vote for the same people in every election. This happens because they promise privileges in order to get votes. Most politicians are members of secret societies, and have close ties to USA and European elites. Our current prime minister is even an American citizen...
A young man living in Greece and having no connections, is hopeless. Without connections, he will have major difficulties if he wants to join a good University(or complete his studies without bribes), if he wants to find a job, or create his own. He will be forced to join the army while privileged young men with connections will illegally avoid it.
And there is no point discussing finding love... Of course pretty women will pick wealthier men, but in Greece even women of moderate appearance prefer men with deep pockets. They prefer sharing the top men than having a man only for themselves.
And the top men in Greece are all frauds. Greece, apart from some natural resources and its tourism industry, produces nothing of value. Corruption is so big, that all productive forces are drowned. So all men of power here, get their power from plundering the Greek people, or having connections with those that do it. Women (and their families) of course are not concerned about that. As long as someone is wealthy, he is desirable, and value as a person is irrelevant.
Despite poor economic condition (but not so desperate as to warrant dire measures), people in power take pleasure in attacking traditional customs, Orthodox Christianity, and traditional Greek patriots. They protect illegal immigrants, and silence their crimes. They attack Christianity, in the media, at schools etc. They are removing all Christian symbols from public places.
Greek media are a pile of garbage. For the biggest part of the day, most major TV networks will show shows discussing greek "vips" lifestyle, sexual relations etc. There are few "political" shows and news shows, all trying to cover the truth and turn the attention of the people at matters of trivial importance. Propaganda is blatant. The previous government was literally destroyed by TV networks. They promoted heavily the current government, so strongly that previous prime minister was forced to make new elections despite being only for 2 years in government.
Current prime minister made promises, NONE of which kept after being elected. Only a few days after election, he went on with the plans of New World Order. He created an artificially dire financial situation, in order to be able to pass whatever laws he wanted, plus giving his friends some money... He "cooked" our budget, by moving payments of 2010 in 2009 and incomes from 2009 to 2010, in order to both make our deficit bigger and be able to claim in 2010 that he "improved" our economy... This doesn't mean that our previous prime minister wasn't a puppet, just that he wasn't able to fulfill New World Order directions like the new government.
Huge economic scandals are discovered every day, and buried by Greek propaganda media. And most honest people are so concerned with working 2 and 3 jobs in order to feed their families, that cannot fight this corruption. Greek people work on average many more hours weekly than other EU countries, get much less pay, and pay more for the same products. And because of the traitors in government, EU newspapers and media call our people lazy. They say we need to work even more and receive even less... Of course this is not true. The plunder of Greek people has been made with their assistance. But this is a long subject and i wont go on with it.
In a few words... Life in Greece sucks. Since I am a computer programmer, i have many times thought about leaving for a better country and make my living there. But i do not want to abandon my home... yet. I would be willing to fight this system, but i see no point since the system is so well entrenched it cannot be tackled by a few men alone.
The reason i wrote you my previous letter is because this new law of banning cash transactions above 1500 euros is just another step towards cashless society, and is being implemented in Greece as a testing phase. I strongly believe it is a matter of time before most western nations see similar laws.
Greek Crisis is Coming to America
TIME FOR CHANGE
"The time has come for major changes, the country can't afford to wait any longer"
"From 1. Jan. 2011, every transaction above 1,500 euros between natural persons and businesses, or between businesses, will not be considered legal if it is done in cash.
Transactions will have to be done through debit or credit cards
With the new tax scale, there is a shift of the burden from low and middle income to high incomes.
There's tax relief for incomes up to 40,000 (euros)
Taxable income based on the new scales will include capital gains from the short-term trading of stocks"
Greece hit by new riots as pressure grows to quit euroGreece hit by new riots as pressure grows to quit euro
April 26, 2010 Support for the bail-out of debt-ridden Greece was in doubt last night, leaving the country on the brink of financial meltdown as top German politicians said it should be forced to quit the euro.
Riots erupting during workers’ protests over planned public spending cuts, just hours after Greek Premier George Papandreou sought emergency £35billion of loans from eurozone countries and the International Monetary Fund.
The Greek government was finally forced to ask for international help after the cost of its borrowing spiralled to a new high, making it prohibitively expensive to borrow money to service existing debts.
Leading members of Germany’s Christian Social Union, sister party in Bavaria to Chancellor Angela Merkel’s Christian Democrats, said Greece should be forced out of the euro.
Europe debt crisis spreads to PortugalEurope debt crisis spreads to Portugal
Greek debt downgraded to junk status, markets slide on fears of wider crisis
Tuesday April 27, 2010 ATHENS
The government debt crisis that has shaken Europe's shared currency widened and intensified Tuesday as Portugal saw its credit rating cut -- and Greece's was reduced to junk status.
Stocks slid worldwide on the news of the double blow that increased the likelihood of a continent-wide debt meltdown and more market turmoil.
Ratings agency Standard & Poor's sent shock waves around the markets after it downgraded the debt of the two countries and warned that holders of Greek debt could take large losses in any restructuring.
That's not a huge surprise the markets increasingly expect Greece's debt will be restructured at some stage even after a euro45 billion rescue package from its 15 partners in the eurozone and the International Monetary Fund.
The real worry is that Greece's debt crisis is mushrooming to other debt-laden members of the eurozone.
One bailout can be dealt with but two will be stretching it -- can Germany, Europe's effective paymaster, continue to bail out the weaker members of the eurozone?
The downgrade of Portugal brought those fears to the fore, after weeks of unsuccesful efforts by European leaders to calm markets.
The crisis threatens to undermine the euro and make it harder and more expensive for all governments to borrow money -- the euro slid over 1 percent following the downgrades to trade at $1.3240, not far off an eight month low.
It has also disrupted cooperation between euro zone governments, with Germany resisting the idea of bailing out Greece unless strict conditions are met.
Nevertheless, most investors think that Greece will have enough money to avoid default in the coming weeks. The future is cloudier.
Both Standard & Poor's and the Greek finance ministry insisted that the country will have enough money in its coffers to make the euro8.5 billion bond payments due on May 19.
Even if it gets it, Greece faces years of austerity with living standards sharply reduced -- Standard & Poor's warned that the Greek economy was unlikely to be as big as it was in 2008 for another decade.
With the economy nosediving, debt repayments accumulating and the society restive and fearful, it takes a brave soul to back the Greek government, led by Prime Minister George Papandreou, to pull through without changing the terms of the debt repayments.
"The latest developments mean that the chances of Greece solving this situation without restructuring its debts are now dim," said Diego Iscaro, senior economist at IHS Global Insight.
As in the financial crisis following the collapse of Lehman Brothers in 2008, investors around the world are fearful about who holds what debt and how much.
Unsurprisingly, stocks tanked.
"We have the makings of a market crisis here," said Neil Mackinnon, global macro strategist at VTB Capital.
The FTSE 100 index of leading British shares closed down 2.6 percent, Germany's DAX slid 2.7 percent and the French CAC-40 in France ended 3.8 percent lower. On Wall Street, the Dow Jones industrial average was down over 100 points in mid-afternoon trading, while the broader Standard & Poors' 500 index fell back below 1,200.
Greek and Portuguese shares were pounded, down 6.7 percent and 5.4 percent, while their market borrowing costs went through the roof -- the interest rate for Greek two-year bonds jumped to a massive 18 percent. That's hardly surprising when one of the world's agencies does not even attach an investment-grade rating on the country's bonds. Junk status means that Greece will have to pay higher costs to borrow if it taps debt markets again.
Meanwhile the interest rate gap, or spread, between Portuguese and benchmark German 10-year bonds -- a key indicator of market skepticism -- rose 57 basis points even before the downgrade to hit 5.86 percentage points. The higher the gap, the less confidence in Portugal -- and it was the widest gap since the shared euro currency, which Portugal and 15 other nations use, came into circulation.
Both governments have imposed budget cutbacks against political resistance from unions at home. Markets have been skeptical that they can push through enough cuts, given political resistance, to put their finances in order.
Both governments responded with alarm at the downgrades.
Greek finance minister George Papaconstantinou siad the downgrade "does nor reflect the real state of our economy, nor the fiscal situation, nor the ongoing negotiations which has the very realistic propects that they will be completed successfully in the next few days."
Nevertheless, he said Greece would pull through.
"One wishes that Europe had acted a little differently. Three and four months ago we were saying that the mechnism must be ready and it must be detailed, that the markets must know what exactly is going. Unfortunately, for a series of political reasons, we are down to the wire," he said.
Meanwhile, Portugal's Finance Minister Fernando Teixeira dos Santos said the downgrade would only make things worse.
"This decision will not help markets to calm down, but will, on the contrary, contribute for their turbulence," Teixeira dos Santos said.
A further worry is that the crisis spreads to Spain, considered too big to be bailed out.
The crisis has also highlighted the inability of the rules set up to support the euro to keep governments from undermining the currency by running up big debts. Those rules limited deficits to 3 percent of grosse domestic product but have been widely flouted, and EU officials are talking about ways to strengthen them.
What Henry Kissinger said about Greece in 1974The Greek people are anarchic and difficult to tame. For this reason we must strike deep into their cultural roots: Perhaps then we can force them to conform. I mean, of course, to strike at their language, their religion, their cultural and historical reserves, so that we can neutralize their ability to develop, to distinguish themselves, or to prevail; thereby removing them as an obstacle to our strategically vital plans in the Balkans, the Mediterranean, and the Middle East.
(As reported in the popular Greek magazine, Oikonomikos Tachydromos on 14 Aug. l997, Henry Kissinger, while addressing a group of Washington, D.C. businessmen in Sept.1974)
God's Solution to the Tower of Babel
April 2010 I think that for too long Christians have held the simplistic view that the Babylonians are united and are all following a distinct agreed-upon plan of action. This is simply not so. And as financial pressures build in the final days of the Ponzi scheme, these disagreements are forced to the surface for all to see.
God is confounding their language once again, and the great Tower of Babel will again prove to be an unfinished building. The four beast kingdoms in Daniel 7 are all fighting among each other today. Babylon is the overall "head," of course, but Persia (Iran) is in the fight, as is Greece and Rome. So we see Babylon disputing with Iran over nuclear rights. Greece is near bankruptcy, which threatens to pull down the whole tower. And Rome (Vatican) is under fire as well for its handling of pedophile priests.
It reminds me that when the Stone strikes the image on its feet (Dan. 2), the whole image crumbles into dust.
So when we see all four beasts snarling and chasing each other in a circle, I think we are nearing the collapse of all of them and the rise of the Kingdom of God, the Stone that is the fifth kingdom of Daniel 2. In symbolic terms, we have gone from gold, to silver, to bronze, to iron (and clay), to STONE.
Greek bonds rated junk by S & PGreek bonds rated junk by S & P
Tuesday, 27 April 2010
Global stock markets tumbled after Greece's debt was downgraded to "junk" by rating agency Standard & Poor's over concerns that the country may default.
It makes the struggling nation the first eurozone member to have its debt downgraded to junk level.
Portugal's debt was also lowered on fears of "contagion", adding to the markets' rout and a fall in the euro.
Germany immediately said it would not "let Greece fall", and there were signs that an aid package could be increased.
Greece wants 40bn euros (£34bn) from eurozone governments and the International Monetary Fund (IMF) to shore up its finances.
But there are fears it will not meet conditions needed to access the funds it needs to make looming debt repayments.
When ratings agencies downgrade the country's credit rating - it means they think it is now a riskier place to invest.
If it reaches junk status, a country loses its investment grade status. Some financial institutions have rules prohibiting them from investing in "junk" bonds.
Greece's 2-year government bond yield surged to almost 15% on Tuesday, making it highly expensive for the country to borrow from the debt market.
Greek 5-year yields hit 10.6%, higher than many emerging market economies, including Ecuador at 10.5% and Ukraine at 7.1%.
The 2-year Portuguese bond yield jumped to 5.23% from 4.16%.
S&P said it was lowering its rating on Greece's debt to BB+ from BBB-.
It also reducing Portugal's debt rating by two notches to A- as doubts intensified about countries with substantial debt relative to GDP.
Greece's finance ministry said in a statement that the downgrade "does not correspond with the real data of the Greek economy."
Portugal's finance minister, Fernando Teixeira dos Santos, also hit back, denouncing an "attack from the markets".
In a statement he described the downgrade and reaction from the markets as "a decisive moment".
"We must remain calm and bring serenity back to the markets," he said. "As in the past, we will do what is necessary to reduce the deficit and promote the competitiveness of the Portuguese economy."
News of the downgrades rocked markets in Europe and the US.
In London, the FTSE 100 index closed down 2.6% with most of the losses following S&P's downgrade of Greece.
Germany's Dax index slid 2.7% and the French Cac-40 lost 3.8%.
On Wall Street, the Dow Jones index closed down 213 points, or 2% at 10,991.
Meanwhile shares in Greek banks slumped by more than 9%, the largest one-day fall in bank shares for 18 months.
Despite earlier hesitation, German Chancellor Angela Merkel on Monday pledged German support to a European financial aid package for Greece, provided "certain conditions" were met.
Germany could provide Greece with up to 8.4bn euros in loans this year. But German public opinion is deeply opposed to the bailout.
In an interview to be published on Wednesday in the business newspaper Handelsblatt, Germany's finance minister says his country will not abandon Greece.
Wolfgang Schaeuble said: "We now have to realise and implement the rescue plan... and thus send a clear signal that we will not let Greece fall.
"We are putting on pressure for quick decisions," he said.
Protestors in Greece
The unpopularity of austerity measures is worrying markets
Meanwhile, the Financial Times reported that the International Monetary Fund is considering raising its contribution to the bail-out by 10bn euros to 25bn euros.
Greece needs to raise 9bn euros by 19 May, but has said it cannot go to the markets because of "prohibitive" interest rates.
The Greek government's cost of borrowing on the money markets has reached record levels in recent days amid investor concern over whether a 40bn euro bail-out package will be agreed.
Eurozone countries, together with the International Monetary Fund, have yet to agree details of the package.
Investors are also concerned that the Greek government's austerity measures - designed to cut domestic spending and reduce its ballooning budget deficit - will prove highly unpopular with the Greek public.
S&P warned holders of Greek debt that they only had an "average chance" of between 30% and 50% of getting their money back in the event of a debt restructuring or default.
It said its action to cut the rating resulted from its "updated assessment of the political, economic and budgetary challenges that the
Greek government faces in its efforts to put the public debt burden onto a sustained downward trajectory".
The agency added Greece's weak long-term growth prospects made it less credit-worthy.
Stocks end rough day with Dow below 11,000Stocks end rough day with Dow below 11,000
Widening concern over European debt crisis helps pull markets lower
April 27, 2010 NEW YORK
Investors are again worried that debt problems in Greece and Portugal could threaten the global economic recovery.
Stocks plunged in the U.S. and Europe Tuesday after Standard & Poor's downgraded the debt of the two European countries.
The Dow Jones industrial average fell 213 points, its biggest loss in almost 3 months.
All the major market indexes were down about 2 percent.
The ratings downgrades also sent the dollar up more than 1.1 percent against the euro, hitting its highest level in about a year.
At the same time, gold and Treasury prices rose as investors sought safer investments.
The 3 often do not trade in the same direction.
"It was a knee-jerk reaction," said Brian Peardon, a wealth adviser at Harrison Financial Group in Citrus Heights, Calif. Peardon said the small size of
Greece and Portugal's economies mean their debt struggles are not yet a major problem.
But if they were to default on their debt, other countries that hold their bonds would also suffer.
Debt-strapped countries would also likely find it harder to spend more to stimulate their economies and help feed the global economic recovery.
Standard & Poor's downgraded Greece's debt to junk status and lowered Portugal's debt two notches to A-minus from A-plus. Greece has already admitted it can't pay debts coming due shortly and it has asked for a bailout from European neighbors and the International Monetary Fund. And there are growing concerns about Portugal's ability to handle its debts.
Investors have been on edge for months about Greece's fiscal crisis even as they've sent stocks higher on signs of an improving U.S. economy. They have also been worried that Portugal could be the next European country to need help. That has undermined confidence in the euro, and raised questions about whether some of the 16 nations that share the currency might abandon it.
"This is a major test case for the euro," said Quincy Krosby, a market strategist with Prudential Financial. The European Union "needs a viable template on how to deal with these issues," Krosby added, noting that troubles extend beyond just Greece.
The drop in the euro can be a problem for U.S. companies that do business in Europe. When the dollar is up against the currency, the profits they earn in European countries translate to fewer dollars and can cause a dip in earnings.
Greece agreed last week to tap a rescue package from the euro nations and the International Monetary Fund. However, there are now worries that Greece won't have access to the money before it is forced to make a big debt repayment on May 19.
A setback in the European economic recovery "sends a U.S. recovery back and spreads to emerging markets," said Eric Thorne, an investment adviser at Bryn Mawr Trust Wealth Management in Bryn Mawr, Pa.
The debt problems have the potential "to have devastating effects," Thorne said. Thorne noted, however, he doesn't yet predict a worst-case scenario that would put a global recovery completely on hold.
Tuesday's downgrades overshadowed a jump in consumer confidence and the latest upbeat earnings reports from U.S. companies including 3M and Dupont. Still, many analysts, noting that the market has been going up almost relentlessly the past two months, have said stocks were due for a pullback.
Tensions mount in GreeceTensions mount amid Greek bailout deal suspense
1 May 2010
The Greek prime minister urged his country to accept unpopular spending cuts as the price to pay for an international debt bailout, as trade unions geared up for rallies to protest the plan.
Prime Minister George Papandreou warned that the nation's survival was at stake, ahead of a crucial meeting of eurozone finance ministers called to discuss a giant international debt bailout for Greece.
"Today what is most important is the survival of the nation, that is our red line," Papandreou told the Greek parliament.
"The measures which we must take... are necessary for the protection of our country, for our survival, for our future," he said.
Finance chiefs of the 16 euro nations are set to meet in Brussels for talks on Sunday chaired by Luxembourg Prime Minister Jean-Claude Juncker.
But Greek union leaders have called for rallies on Saturday, May 1, the traditional day for labour marches and protests, to oppose the austerity plan that any bailout would entail.
They have already launched some work stoppages and have called a 24-hour general strike by public and private sector workers for Wednesday, May 5.
Already on Thursday, police fired tear gas at hundreds of demonstrators trying to march on the finance ministry to protest against the cuts. Further clashes erupted outside parliament.
According to union officials who have spoken to Papandreou, the IMF and EU are demanding wage cuts, lower pensions and higher taxes.
They said the EU and IMF were demanding spending cuts of 25 billion euros ($A35.68 billion) in the next two years on top of sacrifices already made.
A diplomatic source in Brussels told AFP that the finance ministers meeting on Sunday would "give their blessing, but not trigger" the release of funds.
A summit of European leaders on May 7 or 8 was the most likely final step in agreeing emergency loans for Greece worth tens of billions of euros, the source added.
But some parliaments, including in Germany, still have to vote on the bailout before final approval by Europe's heads of state and government.
May 19 deadline
Greece, whose public deficit rose to an estimated 13.6 per cent of gross domestic product last year, is racing to beat a May 19 deadline to secure funding that would avoid a devastating debt default.
German politicians have said the loan package could be worth as much as 120 billion euros ($A171.28 billion) over three years.
European officials have previously talked about 45 billion euros ($A64.23 billion) being made available this year at a rate of "around five per cent."
But EU leaders have also made clear that Greece will have to implement tougher austerity measures in return for the money.
Foreign banks are exposed to $US236.2 billion ($A254.69 billion) of public and private debt in Greece, nearly a third of it held by French banks, data from the Bank for International Settlements in Switzerland showed.
Of the total involving Greek debt of all types, a share of some $US188.6 billion ($A203.36 billion) was held by European banks, according to the BIS.
While fears persist that the crisis could spread to other heavily indebted European nations, markets appear to have been reassured by the news that some kind of a bailout for Greece was imminent.
Greece rocked by general strikeGreece rocked by anti-austerity general strike
May 5, 2010 Wednesday
A general strike paralysed Greece on Wednesday in the first major test of the socialist government's resolve to push through unprecedented austerity cuts needed to avert a fiscal meltdown.
Protest fever swept the country with public transport paralysed, ferries holding at docks and air traffic grounded as unions went on the warpath against the latest wave of spending cuts and tax hikes.
Financial markets worldwide suffered heavy losses as fresh fears spread overnight from Europe and Wall Street to Asia on Wednesday that
massive Greek bailout will not be enough to stop its debt crisis from hitting Spain and Portugal. Tuesday and a group of about
200 communists also stormed Athens Acropolis, unfurling banners reading "Peoples of Europe, Rise Up."
"The Greek people have been called to make sacrifices while the rich pay nothing," said the head of the million-member strong GSEE private sector union, Giannis Panagopoulos.
Wednesday's walkout, the third general strike in as many months, came as the government raced to
push the austerity drive through parliament,
looking to its comfortable majority there to pass the package on Thursday.
Greece's main unions were to mass in central Athens at 11:00 am (0800 GMT) before marching through the streets of the capital to converge on the parliament building.
May Day marches on Saturday led to clashes between anarchists and police who fired tear gas to restore order.
A government official downplayed the walkout saying that "for years there's been strikes and protests in this country without much consequence. We're used to it."
Despite the mounting tensions, political scientist Ilias Nikolakopoulos at polling institute Opinion predicted that "people are going to put up" with the belt-tightening.
"Of course surprises are always possible but I don't believe in an explosion of social discontent," he said.
Pushed to the brink of default, the government agreed at the weekend to slash spending and jack up taxes in return for 110 billion euros
(143 billion US dollars) in loans over three years from eurozone countries and the International Monetary Fund.
Among the major measures, the government is to cut 13th and 14th month bonus pay for civil servants and retirees;
require 3 years more for pension contributions; and raise the retirement age for women to 65, the same level as men currently.
"Given the scale of the public opposition to the austerity measures it is still unclear whether Greece will ultimately be willing to take
years of fiscal punishment and recession to get its fiscal house in order," economist Ben May at Capital Economics said.
"Accordingly, it is still unwise to rule out the government eventually defaulting or restructuring its debts," he added.
After months of hesitation, eurozone countries and the IMF agreed to lend Greece billions at below market rates after concerns soared last week that the Greek debt crisis could trigger a knock-on effect elsewhere.
Fighting accusations of holding up a bailout for Greece, German Chancellor Angela Merkel said on Wednesday that the
Greek debt crisis marked a turning point for the European Union, urging an overhaul of its embattled fiscal rules.
"The future of Europe and the future of Germany within Europe is at stake," Merkel said in a German parliament in a debate on
Berlin's unpopular decision to lend 22.4 billion euros in taxpayers' money to Greece.
IMF chief Dominique Strauss-Kahn, in comments to the French daily Le Parisien published Wednesday, said the EU-IMF package had been put together with the idea of preventing such a scenario.
But he added there was always a risk of "contagion" and that "we must nevertheless remain vigilant."
Contagion fears triggered a major sell-off of European and US stocks on Tuesday that spread to Asian markets on Wednesday while the euro fell to fresh one-year lows below 1.30 US dollars.
European markets recovered slightly at the opening of trading on Wednesday.
3 dead as Greece protest turns violent . . . . . 3 dead as Greece protest turns violent
THESE ARE MURDERERS, NOT SIMPLY RIOTERS!
5 May 2010
At least 3 people have been killed in the Greek capital as protesters set fire to a bank during a general strike over planned austerity measures.
The fire brigade said three bodies were found inside the bank in Athens. Two other buildings are also on fire.
Petrol bombs were thrown at police who responded with pepper spray, tear gas and stun grenades.
Protesters are angered by spending cuts and tax rises planned in return for a 110bn euro (£95bn) bail-out for Greece.
Parliament is to vote on the measures by the end of the week.
Measures include wage freezes, pension cuts and tax rises. They aim to achieve fresh budget cuts of 30bn euros over three years, with the goal of cutting Greece's public deficit to less than 3% of GDP by 2014. It currently stands at 13.6%.
Outside parliament, a group of protesters rushed up a flight of steps, taunting MPs to come out and calling them "thieves".
Riot police forced them back, but right next to parliament, others groups set buildings on fire - including a tax office.
Quite simply Europe's future is at stake. Europe is at a fork in the road
German Chancellor Angela Merkel
Merkel urges support for Greece
The Greek protesters' ire is aimed against symbols of capitalism, says the BBC's Malcolm Brabant in Athens.
Our correspondent says the deaths will change the equation, increasing pressure Greek Prime Minister George Papandreou who has spoken of "great sacrifices" needed.
The general strike is the third to hit Greece in as many months.
Meanwhile, the German parliament has begun considering the bail-out plan for Greece.
Chancellor Angela Merkel urged MPs to back the emergency loan package agreed by European finance ministers at the weekend.
It requires Germany to pay the largest proportion of the loans.
"Quite simply, Europe's future is at stake," she said.
The EU has agreed to provide 80bn euros (£69bn) in funding - of which around 22bn euros would come from Germany - while the rest will come from the International Monetary Fund (IMF).
Flights in and out of Greece stopped at midnight, and trains and ferries were not running. Schools, hospitals, and many offices are shut.
The government has appealed to demoralised staff in the military, police, schools and hospitals not to retire, fearing the surge in demand for benefits could further drain treasury resources.
I'm feeling more and more angry every day, because those who got us into this mess are not held responsible
Foreign governments and investors are watching events in Greece with concern.
Chris Lowe of FTN Financial in New York told the BBC that the US financial community had been shocked by the violent protests.
"The [US] reaction is that [Greek] people will simply refuse to accept the austerity plan," he said.
"If the Greeks are this upset, then maybe we need to worry about the Portuguese and Spanish and Italians being upset with the cuts they're going to have to make."
Union leaders say the cuts target low-income Greeks.
"There are other things the [government] can do, before taking money from a pensioner who earns 500 euros (£430) a month," Spyros Papaspyros, leader of the public servants' union ADEDY, told Greek private television.
Greece's economic reforms that led to it abandoning the drachma in favour of the euro in 2002 made it easier for the country to borrow money.
The opening ceremony at the Athens Olympics
Greece went on a debt-funded spending spree, including high-profile projects such as the 2004 Athens Olympics, which went well over budget.
A defunct restaurant for sale in central Athens
It was hit by the downturn, which meant it had to spend more on benefits and received less in taxes. There were also doubts about the accuracy of its economic statistics.
A man with a bag of coins walks past the headquarters of the Bank of Greece
Greece's economic problems meant lenders started charging higher interest rates to lend it money and widespread tax evasion also hit the government's coffers.
Workers in a rally led by the PAME union in Athens on 22 April 2010
There have been demonstrations against the government's austerity measures to deal with its 300bn euro (£267bn) debt, such as cuts to public sector pay.
Greek Prime Minister George Papandreou at an EU summit in Brussels on 26 March 2010
Now the government has announced that it needs to access the 30bn euros (£26bn) in emergency loans it has been offered by other EU countries.
In Athens, Greeks spoke of their anger at the tough economic measures.
Businessman Dmitris Mentis told the BBC that wealthy Greeks had to pay their "fair share of the burden".
"The rich class has been evading taxes for decades now," he said.
Athens-based journalist Christos Michaelides told the BBC: "There is a big fear in the whole of society - a sense of injustice in most of the measures.
"There is a fear that things could get very, very ugly if people don't feel that what they are doing now, in these austerity measures, is going to be worthwhile."
On Tuesday, several thousand teachers and students marched to parliament carrying black flags and banners.
The demonstration was largely peaceful but some scuffles broke out near the parliament building.
The bail-out deal is designed to prevent Greece from defaulting on its massive debt.
However, it must first be approved by some parliaments in the 15 other eurozone countries.
Chaos as Crisis Deepens in GreeceChaos as Crisis Deepens in Greece
MAY 6, 2010 - ATHENS
Greece's fiscal crisis took a new turn to violence Wednesday when
3 people died in a firebomb attack
amid a paralyzing national strike, while governments from Spain to the U.S. took steps to prevent the widening financial damage from hitting their own economies.
U.S. Treasury officials have been quietly urging their European and International Monetary Fund counterparts to put together a Greek rescue plan more quickly to contain the damage, it emerged Wednesday,
as U.S. policy makers worry the continent's problems could undermine a U.S. recovery much as U.S. housing woes hammered Europe in 2008.
In Spain, rival political leaders came together Wednesday with an agreement that aims to shore up shaky savings banks by the end of next month.
Banks in France and Germany, which are among Greece's top creditors, pledged to support a Greek bailout by continuing to lend to the country.
Investors, meanwhile, are pouring money into bonds of countries seen as less exposed to the crisis, from Russia to Egypt.
Anxiety over the euro-zone economies sent the euro down to about 1.29 to the dollar, its lowest level in more than a year.
The Dow Jones Industrial Average fell for the second straight day, losing 58.65 points, or 0.54%, to close at 10868.12.
Greece's 24-hour nationwide general strike brought much of the country to a standstill, closing government offices and halting flights, trains and ferries.
At the same time, tens of thousands of protesters marched through Athens in the largest and most violent protests since the country's budget crisis began last fall.
Angry youths rampaged through the center of Athens, torching several businesses and vehicles and smashing shop windows.
Protesters and police clashed in front of parliament and fought running street battles around the city.
Witnesses said hooded protesters smashed the front window of Marfin Bank in central Athens and hurled a Molotov cocktail inside. The three victims died from asphyxiation from smoke inhalation, the Athens coroner's office said. Four others were seriously injured there, fire department officials said.
A police spokesman said eight fires in Athens office buildings and bank buildings had been brought under control.
Later Wednesday, black smoke billowed from fires on one of Athens's main shopping streets. Glass shards and smoldering garbage littered the sidewalks.
Greek Prime Minister George Papandreou condemned the violence. "Everyone has the right to protest," he said in a statement to parliament. "But no one has the right to violence and especially violence that leads to the death of our compatriots."
Wednesday's protests were sparked by Greece's weekend agreement to adopt austerity measures in exchange for a €110 billion ($143 billion) bailout loan from the European Union and the IMF. Unions challenged Greece's parliament, which could consider the measures as soon as Thursday, to vote them down.
The general strike marks the broadest challenge to date to the government of Mr. Papandreou, which is pressed to pass the austerity legislation to unlock bailout funds to meet a debt payment later this month that it otherwise couldn't meet.
The protests also brought out many Greeks who were resigned to belt-tightening. Their unhappiness at the cuts was matched with rancor toward a generation of politicians who they say spurred the crisis with decades of corruption, kickbacks and accounting legerdemain aimed at obscuring to the EU the true level of Greece's annual deficits.
"For 30 years the Greek people have been held hostage," said Periandros Athanassakis, 48, a garbage collector in Piraeus, the port near Athens. "Those who stole the money should pay."
Some officials saw in Wednesday's protests the seeds of broader discontent. "We may have an uprising in the making," one senior Greek official said.
Greeks generally don't blame Mr. Papandreou for the country's problems, however, saying he inherited them from predecessors. It was his administration, elected in October, that announced the government's budget deficit for 2009 would be equivalent around 13% of gross domestic product, compared with the 6% claimed by the previous administration.
Mr. Papandreou's approval ratings are higher than those of the leader of the main opposition party.
Analysts also said the shock of Wednesday's deaths could nudge Greece's fractious political parties toward closer cooperation in dealing with the crisis and making it easier to pass reforms.
"This changes the political scene," said George Sefertzis, an independent political commentator with the Athens consultancy Evresis. "There is no doubt that the deaths ease some of the political pressure."
Under terms of the bailout deal, Greece's government has announced a €30 billion package that will slash public-sector wages, cut pensions, freeze public- and private-sector pay, liberalize Greece's labor laws and raise some taxes.
In Berlin on Wednesday, Chancellor Angela Merkel called on parliament to approve Germany's contribution of €22.4 billion in loans to Greece. German public opinion opposes a Greek bailout but Ms. Merkel said it was essential. "Europe stands at a crossroad," she said. "With us, with Germany, there can and will be a decision which lives up to the political, historical situation."
In Greece's northern city of Thessaloniki, there were reports of violence as police clashed with demonstrators who were attacking shop fronts amid a rally that drew at least 20,000 protesters to the streets.
Police officials estimated there were 20,000 protesters in Athens. Union officials said union-affiliated protesters alone totaled more than 60,000. Others put the number higher still. "This rally was double the size of the largest rally that has ever been held in Greece," said Spyros Papaspyros, president of Adedy, a civil-service umbrella union. "If the government doesn't listen, there will be more strike action next week."
The day's general strike, the year's third, shut ministries and public offices. State hospitals and public utilities operated with skeleton staff. Shopkeepers joined the strike at midday, while journalists, bank workers, teachers, court workers, lawyers and doctors also walked off the job.
Many Greeks taking part in the demonstration saw little alternative than to accept the government measures and brace for a long, deep recession.
"I don't expect the measures to be withdrawn," said Pericles Papapetrou, 61, an architect and engineer who used to be mayor of the town of Elefsina. But, he said, the measures "could lead to extreme situations, such as an increase in crime, and also to an explosion of young people with no future."
Artemis Batzak Panayou, a cleaning lady working for a local government, saw her €1,200 monthly salary, on which she supports three children, cut by €250 at the beginning of the year.
She believes it will fall further. "There is no way to survive on the daily wages in the public sector," she said, adding:
"Greece won't be fixed until all the crooks are removed from government."
Printed in The Wall Street Journal, page A1
And the USA wont be fixed either unless this evil criminal govt is removed from the whitehouse!
Gerald Celente on Greece RiotsGerald Celente on Greece Riots
Greece riots on one side - ObamaCare on the other
same picture, time difference
Bomb explodes inside Greek courthouseBomb explodes inside Greek courthouse
May 14, 2010 THESSALONIKI, Greece
A powerful bomb exploded inside a courthouse in the northern Greek city of Thessaloniki Friday, sending smoke billowing in the building and wounding one person.
It was the second bombing in 2 days, after a blast Thursday outside a jail in Athens that also wounded one person, raising concern that a recent crackdown on Greek militant groups could spur a new series of attacks.
Bombings and other militant attacks are frequent in Greece, but they usually occur at night and rarely target buildings during working hours.
Police had evacuated most of the court building after a Greek newspaper and television station received an anonymous call warning that a bomb had been planted in the toilets in the building's basement.
Dozens of people inside the building were seen running out the court moments before the blast.
Lawyer Babis Apostolides said one man sustained leg injuries, and he had transported him to a nearby hospital, where he received stitches.
"The man was bleeding and was in shock ... fortunately he got medical attention quickly and he's OK," Apostolides told private Alpha television.
He said many people inside the building had been reluctant to leave, because bomb hoaxes at the court are common.
"Police were virtually pulling people out ... there were a sense of panic because the blast was very strong and the dust and smoke was terrible."
Police said the blast knocked down some walls inside the building. A police investigator, who asked not to be identified because he is not authorized to talk to the media, described the damage to the lower part of the building as "extensive."
Court officials said the building will be closed Monday and Tuesday.
The attack came less than a day after a powerful bomb exploded Thursday night outside Greece's largest prison, Korydallos, in the Greek capital, Athens. One woman was slightly injured in that blast, cut by flying glass. That blast had also been preceded by a warning call to a newspaper.
There was no immediate claim of responsibility for either attack, but suspicion fell on radical Greek militant groups that have stepped up attacks in recent years and have been targeted in a recent police crack down.
Krugman Misleads On Greece
Bomb explodes near Athens courthouse
December 30, 2010 A bomb hidden on a parked motorcycle exploded outside two court buildings in central Athens on Thursday, damaging cars and shattering windows but leaving no one hurt, officials said.
The powerful rush-hour blast occurred at 8:20 a.m. (0620 GMT) following a warning telephone call to a newspaper and private TV station, authorities said. Police had evacuated the targeted buildings, which are used for administrative purposes. State health officials confirmed that no one was injured.
A strong bomb blast shook one of the main courthouse buildings in central Athens on Thursday morning, Greek police said.
The explosion occurred about 40 minutes after an unidentified person placed warning calls to a local TV station and newspaper, saying a bomb would explode outside the "administrative first instance courthouse." The advance notice gave police enough time to evacuate the building.
Police said the blast came from a motorbike rigged with explosives that was parked in the median across from the courthouse in the Ambelokipi district. The caller provided the place number on the bike.
A cloud of smoke was visible in the area and there was some damage to the front of the building and nearby cars from the explosion.
Greece Considers Exit from Euro Zone, Plans New Currency
May 6, 2011 Athens Greece is considering withdrawing from the euro zone.
Greece's economic problems are massive, and they are considering abandoning the euro and reintroducing its own currency.
Greece default would hurt other countries - 24 May 2011
June 15, 2011 Police have blocked off one street to keep striking workers away from parliament.
Thousands of demonstrators have gathered in Athens.
PM George Papandreou is trying to push through fresh policies as part of the conditions for the EU and IMF's bail-out package.
Everything about the IMF is BAD. Evil.
Ports, public transport and banks are badly disrupted as unions go out on strike.
State-run companies have also joined the walkout, while hospitals are only offering emergency care.
Folks, the USA is no better off than Greece, we just are not told this by controlled press
Eurozone must act before Greek crisis leads to global meltdoEurozone must act before Greek crisis leads to global meltdown, IMF warns
June 20, 2011 The International Monetary Fund (IMF) has expressed its growing concern about the deepening crisis in Greece, stressing that a
failure by the European Union to take decisive action could lead to a domino effect through the single-currency zone and result in a second global financial meltdown.
In its starkest warning yet that Greece has the potential to replicate the system-wide shock triggered by the collapse of Lehman Brothers in September 2008, the IMF told Europe's policymakers to stop squabbling over the terms of a bailout and act immediately to prevent contagion.
"While courageous attempts have been made to address the crisis, policymakers are yet again facing uncomfortable dilemmas, raising uncertainty about the final outcome,"
the fund said in its annual health check on the eurozone.
"With deeply intertwined fiscal and financial problems, failure to undertake decisive action could rapidly spread the tensions to the core of the euro area and result in large global spillovers."
The warning from the IMF was issued by acting managing director John Lipsky, who has been in charge since the resignation of Dominique Strauss-Kahn last month.
It came as Europe's finance ministers said the price of a fresh €12bn (£10.5bn) bridging loan to Greece was agreement by the parliament in Athens to fresh austerity measures. George Papandreou, the Greek prime minister, is currently trying to secure agreement for a package of measures that would involve deep wage cuts and sweeping privatisation.
A team of officials from the IMF has been studying the eurozone economy and concluded that continued financial support for Greece from the other 16 members of the single currency was needed.
It said a "more cohesive and co-operative approach is needed to manage the crisis in the periphery" – the group of nations including Greece, Ireland and Portugal that have needed financial help from the IMF and the EU over the past year. The IMF fears that without decisive action there is a risk of the crisis spreading to other heavily indebted eurozone countries such as Spain and Italy.
Despite strong opposition to the austerity measures imposed as a condition of bailout funds, the IMF said it was vital that Greece and the other struggling nations embrace deep structural reform. "Crucial is a determined commitment to adjustment in the programme countries, including immediate and far-reaching structural reforms and an ambitious drive to open up the economy to foreign competition and foreign ownership along programme commitments. Privatisation will contribute to these objectives beyond helping to establish debt sustainability."
The fund added: "Rapid implementation of the commitment to scale up the European financial stability facility and a further extension of its potential uses would sent a much needed signal that member countries 'will do whatever it takes to safeguard the stability of the euro area'. In this context, it will be essential to bring the unproductive debate about debt reprofiling or restructuring to closure quickly, and avoid and impression that the European stability mechanism will be conditional on debt restructuring."
In its report, the IMF said the sovereign debt crisis threatened the "broadly sound" recovery in the euro area, adding that "much remains to be done to secure a dynamic and resilient monetary union".
The IMF also said: "A strong core is pulling ahead of a periphery facing daunting challenges, with very high debt levels, severe competitiveness problems, and fragile banking systems. Strong policy action by national authorities is a prerequisite, but should be backed by a truly cohesive approach from all euro area stakeholders."
Protesters clash with riot police in Athens strike
ATHENS, Greece (AP) — Youths hurled rocks and fire bombs at riot police in central Athens on Tuesday as a general strike against new austerity measures brought the country to a standstill.
Lawmakers were embarking on their second day of debate on austerity measures that must be passed in votes on Wednesday and Thursday if Greece's international creditors are to release another batch of bailout funds to see it beyond the middle of next month.
The package must be passed so the European Union and the International Monetary Fund release the next installment of Greece's euro110 billion ($156 billion) bailout loan. Without that euro12 billion ($17 billion) installment, Greece faces the prospect of a default next month — a potentially disastrous event that could drag down European banks and hurt other financially troubled European countries.
The new austerity drive is proving hugely unpopular in Greece, and the demonstration in central Athens soon degenerated into violence. For several hours, police fired volleys of tear gas and stun grenades at masked and hooded youths who pelted them with petrol bombs and chunks of smashed marble. Police said 18 people were detained, with five of them later arrested, while 21 policemen were injured.
The clashes came at the start of a two-day strike called by unions furious that the new euro28 billion ($40 billion) austerity program will slap taxes on minimum wage earners and other struggling Greeks. The measures come on top of other spending cuts and tax hikes that have sent Greek unemployment soaring to over 16 percent.
"The situation that the workers are going through is tragic and we are near poverty levels," said Spyros Linardopoulos, a protester with the PAME union blockading the port of Piraeus. "The government has declared war and to this war we will answer back with war."
Two demonstrations by a total of about 20,000 people began peacefully, but tension escalated into violence when two groups of protesters clashed.
The situation quickly degenerated, with rioters setting fire to giant parasols at an outdoor cafe, using some to form barricades, and smashing windows of a McDonald's outlet and other snack shops. Staff at upscale hotels handed out surgical masks to tourists and helped them with rolling luggage past the rioting, over ground strewn with smashed-up marble and cement paving stones.
Youths set fire to a satellite truck parked near parliament, which rolled downhill into a kiosk whose freezer exploded. Hooded youths ducked behind the burning truck to help themselves to ice-cream cones.
"The troublemakers are attacking the police fiercely" and trying to disrupt a peaceful protest, police spokesman Athanasios Kokalakis said.
The scale of the strike bought large parts of the Greek public sector to a halt. Everyone from doctors and ambulance drivers to casino workers and even actors at a state-funded theater were joining the strike or holding work stoppages for several hours.
An ongoing strike by electricity company workers kept up rolling blackouts across Greece. Not far from the violent protest, cafes and ice cream vendors popular with tourists used portable generators to keep the power on.
Hundreds of flights were canceled or rescheduled as air traffic controllers walked off the job for four hours in the morning. Another walkout is scheduled later. Strikes by public transport workers snarled traffic across the capital and left tourists stranded around Piraeus.
Many Greeks insist they should not be forced to pay for a crisis they believe politicians are responsible for.
"We don't owe any money, it's the others who stole it," said 69-year-old demonstrator Antonis Vrahas. "We're resisting for a better society for the sake of our children and grandchildren."
Even lawmakers from the governing Socialists have been upset over the latest measures and Prime Minister George Papandreou has struggled to contain an internal party revolt. He reshuffled his Cabinet earlier this month to try to ensure his party's support for this vote, but the Socialists still only have a 5-seat majority in the 300-member Parliament.
Papandreou urged lawmakers Monday to fulfill a "patriotic duty" by voting in favor of the new measures, but two of his own lawmakers have suggested they won't.
European officials have also been pressuring Greece's the main conservative opposition party to back the austerity bill, but so far their urgings have failed to convince conservative party leader Antonis Samaras.
"I trust that the Greek political leaders are fully aware of the responsibility that lies on their shoulders to avoid default," European Monetary Affairs Commissioner Olli Rehn said.
In addition to seeking the next batch of bailout funds, Greece looks like it will need another financial rescue. Papandreou has said a second bailout would be roughly the same size as the first and hopefully on better terms.
"I call on Europe, for its part, to give Greece the time and the terms it needs to really pay off its debt, without strangling growth, and without strangling its citizens," he said.
Even with the new austerity measures and a second bailout, many investors still think Greece is heading for some sort of default because its overall euro340 billion debt burden is too great.
Greek parliament passes key austerity bill
29 Jun 2011 — Greece's lawmakers approved a key austerity bill Wednesday needed to avert default, despite a second day of rioting on the streets of Athens that left dozens of police and protesters injured.
The passage of the bill was a decisive step for the country to get the next batch of bailout loans from international creditors due from last year's financial rescue. Another bill has to be passed Thursday for the government to secure the money.
The bill to cut spending and raise taxes by €28 billion ($40 billion) over five years has provoked widespread outrage, coming after a year of deep cuts that have seen public sector salaries and pensions cut and unemployment rise to above 16 percent.
While deputies voted, stun grenades echoed across the square outside the Parliament building and acrid clouds of tear gas hung in the streets. Authorities and emergency services said 21 police and 15 protesters were injured and transferred to hospitals, while 26 people were detained.
The European Union and International Monetary Fund have demanded both bills pass before it releases €12 billion of bailout funds — without the money, Greece was facing defaulting on its debts by the middle of next month, potentially triggering a banking crisis, particularly in Europe, and turmoil in global markets.
"We must avoid the country's collapse with every effort," Prime Minister George Papandreou said in his speech prior to the vote. "Outside, many are protesting. Some are truly suffering, other are losing they privileges. It is their democratic right. But they and no one else must never suffer the consequences and for their families of a collapse. We must do everything so that there is no freeze in payments."
The Greek vote was greeted by a sense of relief in Europe's capital cities, who have been fretting about the impact of a potential Greek default both on their banking systems and on the future of the euro currency itself.
"That's really good news," German Chancellor Angela Merkel said when told of the outcome of the vote on her way out of an economic forum in Berlin. Germany is Greece's biggest creditor.
Equally, relief was the main response in markets too. Soon after the vote, the euro was trading at a fairly elevated level around the $1.44 mark while stock markets around the world were posting big gains.
In Greece, the main Athens stock market closed up 0.5 percent at 1,264, while borrowing costs eased some 80 basis points from a morning high, with the yield on 10-year bonds settling at the still high 16.55 percent.
"The fact that the Greek parliament has passed the government's medium-term fiscal plan clearly reduces the chances of a near-term disaster," said Ben May, European economist at Capital Economics.
The unpopular package of spending cuts and tax hikes passed by 155 votes to 138, with five opposition deputies voted "present" — a vote which backs neither side.
A sole deputy from the governing socialists, Panayotis Kouroublis, dissented over government plans to sell a further stake in Greece's state electricity company and was soon expelled from the parliamentary group by Papandreou.
In a dramatic vote, socialist deputy Alexandros Athanassiadis, who had previously vowed to vote against the bill, overturned his decision at the last minute and backed the package, saying he had been swayed by the prime minister's comments in parliament.
A conservative deputy broke ranks with her party's line to also vote in favor, bolstering the government's majority of five seats in the 300-member parliament.
In the run-up to the vote, violence engulfed the square outside for the second day, while services across the country ground to a halt in the last day of a 48-hour general strike. Riot police fired volleys of tear gas at swarms of young men who were hurling rocks and other debris as well as setting fire to trash containers.
After a lull in the fighting around the time of the vote, the riot started up again with intensity.
Protesters threw flares and orange and green smoke bombs, and a few sprayed fire extinguishers at police, who picked up rocks and tossed them back. Heavy clouds of tear gas wafted over the chaotic scene in front of parliament.
Greece set for further vote on cuts package
Greeks want the rest of the world to pay for their greed
30 Jun 2011
Second day of voting on government austerity package follows overnight clashes that rocked the capital.
Greece government expects to pass a second austerity bill today, to pull them back from default by securing more funds from the European Union and the IMF
The Greek government has tried to enact legislation to crack down on tax evasion.
But the package of taxes, spending cuts and privatisations has angered many Greeks, with thousands taking to the streets, and police clashing overnight with protesters.
Dow stocks tumble on Greek Gloom
Greece set to default on massive debt burden, European leaders concede
European leaders bowed to the inevitable and conceded that Greece is likely to default on its massive debt burden, which would be a first among the 17 countries using the euro.
They also abruptly shifted tack in the eurozone debt crisis by raising the possibility of using the eurozone's bailout fund to buy back Greek debt on the markets, meaning sizeable losses for Greece's private investors and reduced debt levels for Athens.
Following 12 hours of fraught negotiations in Brussels haunted by the risks of contagion in the eurozone spreading to Italy, now being targeted by the financial markets for the first time in the 18-month crisis, the 17 governments of the eurozone pointedly failed to rule out a sovereign debt default by Greece.
A statement said that, at the meeting, the European Central Bank "confirmed its position that a credit event or selective default should be avoided". There was no declaration of governments' support for the ECB position. Jean-Claude Juncker of Luxembourg, president of the Eurogroup, and Olli Rehn, EU commissioner for monetary affairs, both declined to offer one.
"That does not mean that the Eurogroup as such would do everything to provoke a credit event," quipped Juncker.
As recently as last week, eurozone ministers stressed the need to avoid default in Greece, indicating the rapid shifts under way in an escalating crisis.
Deep-seated divisions remained between the wealthy northern creditor governments and southern Europe, with market pressures pushing up Italian and Spanish borrowing costs and appearing to vindicate ECB warnings of the risks of contagion from Greece.
Italian borrowing costs hit 5.7%, their highest levels in more than a decade, while the yields, or borrowing rates, on Spanish government bonds reached 6% – the highest level since the creation of the euro.
Dealers reported a race to "safe havens" and gold priced in euros and sterling reached record levels of €1,110.48 and £979.89 an ounce in early trading before falling back, while the euro hit a record low against the Swiss franc – a safe-haven currency. Wall Street was also caught up in the anxiety, with US stocks falling 1% in early trading, while the FTSE 100 was also 1% lower.
Analysts said there was little hope of calm returning to the markets while eurozone governments remained gridlocked over how to respond despite weeks of negotiations aimed at encouraging Greece's private creditors to take part in a new bailout.
France has proposed rolling over Greece's privately held debt, mostly for 30 years, while Germany revived calls for a Greek debt swap, entailing "haircuts" for investors. The meeting remained split on the scale and modality of private creditor involvement in the new Greek bailout, the second in more than a year, EU officials said.
European diplomats said the meeting needed to be "cathartic", paving the way for a breakthrough to stave off a wider catastrophe in the months ahead. The major new developments were that eurozone governments accepted for the first time that a Greek default may be inevitable and that the eurozone's €440bn euro bailout fund should be reconfigured to buy back Greek debt.
"We stress our intention to make Greek debt more sustainable," said Jean-Claude Juncker, the Luxembourg prime minister who chairs the 17-country Eurogroup.
The interest Greece is paying on the bailout loans would be lowered, their maturities lengthened, and the "flexibility and scope" of the eurozone bailout fund would be "enhanced".
Sources said the proposal was to use the fund to reduce Greece's debt burden by buying back Greek debt from bond-holders at a discount. This is likely to be contested by Germany, the central player among the creditor countries, and could run into problems in Germany's parliament. The rules for the bailout fund would need to be rewritten, meaning the deal would need to go before MPs in Berlin, EU officials said.
But the scheme would also require the participation of Greece's private creditors who would suffer losses, long a German demand. There was no final agreement this morning amid murmurings of an emergency EU or eurozone summit being called before the end of the month.
The outlines of the new rescue emerging this morning pitted Germany against the European Central Bank, with elements of the deal designed to accommodate both camps. Bailout fund buybacks are supported by the ECB, while private creditor losses are a German condition.
Accepting that a Greek default was now impossible to avoid, EU governments are hoping it will be brief and "selective", not triggering a "credit event" on the financial markets that could wreak havoc on the credit default swap markets, also in the US, and unleash contagion.
Last week two of the three big ratings agencies predicted a Greek-style scenario for Portugal, downgrading its debt to junk, while predicting any private-sector involvement in the second Greek bailout being negotiated would be viewed as a default.
Those verdicts provoked rage from the EU. Viviane Reding, the EU justice commissioner, said: "Europe can't allow three private US enterprises to destroy the euro."
Either their "cartel" was smashed or "independent" European and Asian ratings agencies would be set up. "We can't have a situation where a cartel of three US enterprises decides the fates of entire national economies and their citizens," she said.
Greece in the spotlight after evoking selective default16 July 2011, by Isabel Malsang - Athens (AFP)
Greece heads to another EU summit next week on fresh aid for its debt-wracked economy after evoking -- before pulling back -- the thorny notion of a selective default that could unleash a eurozone storm.
The term is understood to mean a pick-and-choose approach to a country's maturing debt, with a government arranging to delay repayment on certain obligations while continuing to fully honour others.
But to many investors, and more importantly to credit rating agencies that have already demoted Greece's bonds to junk status, these are just semantics.
A French plan for private banks to rollover Greek government bonds as they came due was effectively shot down this month when ratings agency Standard and Poor's said that such an arrangement would be tantamount to default.
Fellow evaluator Fitch this week also warned that "private sector involvement would likely be viewed as a sign of sovereign credit impairment and could trigger a rating default event."
European officials have sought to square the circle and lighten Greece's crushing repayments timetable on its 350-billion-euro debt without triggering a horror scenario that could have unforeseen consequences for the troubled eurozone.
The Dutch finance minister broke the ice this week by revealing that the 17 eurozone ministers "did not exclude" the notion during talks in Brussels.
He was swiftly overruled by colleagues but later statements by the Belgian finance minister showed that the EU is still trying to tiptoe around the issue.
"There needs to be an absolutely voluntary (private sector) participation so that it is not seen as a default," he told AFP on Saturday.
Greece itself seems torn on the issue, with its finance minister appearing to downplay the dangers before Prime Minister George Papandreou stepped in to condemn "wordplay" on the matter.
"The word selective default scares without reason," Finance Minister Evangelos Venizelos told reporters after Tuesday's Eurogroup ministerial summit.
"It is not a real event, it is not default. It is an evaluation by the three familiar rating agencies," he said, meaning Fitch, Moody's and Standard and Poor's.
"It does not on its own create a reality, nor does it activate the notorious CDS mechanism," Venizelos said, referring to credit default swaps that have gained in value in expectation of Greek insolvency.
"If we are calm and wise, if we have a plan and apply it, we can manage anything to our benefit, because all this ultimately leads to a more viable debt...all this is done to provide a solution," the minister said.
Main opposition leader Antonis Samaras swiftly chastised Venizelos for even bringing up the issue of selective default.
"Just uttering the term could have disastrous results...and this is true for all its variants," Samaras said.
And Prime Minister Papandreou said "wordplay should not be allowed, in particular the deliberate confusion of terminology used by rating agencies in their reports with painful situations for the real economy."
Regardless of the outcome, Greece officially entered "uncharted territory" this week, a senior banker told AFP.
Greek officials this week held two days of talks with private creditors in Rome for a third time in less than a month.
Eurozone nations will hold an extraordinary summit on July 21 in Brussels on ways to tackle the debt crisis.
The problem, however, has spread: Ireland and Portugal have also had to be bailed out, while Italy and Spain are seen to be at risk given the strained state of their public finances.
The EU and International Monetary Fund bailed out Greece in May 2010 with a package worth 110 billion euros ($160 billion) in exchange for a series of drastic austerity measures to stabilise its public finances.
The package has had some success but Greece is still in serious difficulty and needs another bailout estimated to be around the same amount.
Moody's warns Greek default virtually 100 percenthttp://news.yahoo.com/moodys-warn...tually-100-percent-074635812.html
Moody's warns Greek default virtually 100 percent
ATHENS, Greece (AP) — Moody's downgraded Greece's bond ratings by a further three notches Monday and warned that it is almost inevitable the country will be considered to be in default following last week's new bailout package.
The agency said the new EU package of measures implies "substantial" losses for private creditors. As a result, it cut its rating on Greece by three notches to Ca — one above what it considers a default rating.
Though Moody's said a Greek debt default is "virtually certain," it noted that the new measures will increase the likelihood that Greece will be able to stabilize and eventually reduce its overall debt burden.
It also said the package also benefits other eurozone countries by "containing the near-term contagion risk that would likely have followed a disorderly payment default or large haircut on existing Greek debt."
In recent weeks, financial markets have been rocked by fears that much bigger economies like Spain and Italy may get dragged into Europe's debt crisis mire, which has also seen Ireland and Portugal bailed out alongside Greece.
Eurozone countries and the International Monetary Fund last week agreed to give Greece a second bailout worth euro109 billion ($155 billion), on top of the euro110 billion granted in rescue loans a year ago.
If all goes to plan, banks and other private investors will contribute some euro50 billion ($71 billion) to the rescue package until 2014 by swapping Greek bonds that they hold for new ones with lower interest rates or slightly lower face value, or selling the bonds back to Greece at a low price
"The support package incorporates the participation of private sector holders of Greek debt, who are now virtually certain to incur credit losses," Moody's said in a statement. "If and when the debt exchanges occur, Moody's would define this as a default by the Greek government on its public debt."
Despite Greece's new package, which was more comprehensive than many in the markets had predicted, Moody's said it's going to take many years of hard graft for Greece to get complete control of its debts.
"Greece will still face medium-term solvency challenges — its stock of debt will still be well in excess of 100 percent of GDP for many years and it will still face very significant implementation risks to fiscal and economic reform," Moody's said.
The agency added that it will reassess Greece's rating once the bond exchange has been completed "to ensure that it reflects the risk associated with the country's new credit profile, including the potential for further debt restructurings."
On Friday, ratings agency Fitch also said Greece faced a default but that it would reassess the rating once the new bonds are issued — implying that the bad rating might only last for a few days.
While Greece's brush with default will be a first for a euro country, the immediate practical consequences of the rating for Greece should be limited.
For weeks, the overriding fear was that, because of the bad rating, already struggling Greek banks would be frozen out of the European Central Bank's emergency liquidity operations.
However, last week eurozone leaders found a way around that threat by promising to temporarily deposit euro35 billion with the ECB to boost the creditworthiness of defaulted bonds used as collateral by Greek banks, until the default rating has been lifted.
Crucially for Greece and Europe as a whole, the International Swaps and Derivatives Association, a trade association, said the new rescue deal is not expected to trigger payment of bond insurance because private sector involvement is voluntary.
Greek government spokesman Elias Mossialos brushed off Moody's downgrade as of "no practical value," arguing that domestic lenders can count on secure credit lines under the terms of the new bailout.
"Unfortunately for them, (ratings agencies) won't have anything to work on for many years," he said in a radio interview. "Perhaps the finance ministry should cancel its subscriptions, because I think the Greek government pays subscriptions to these agencies to receive their results ... I don't think we need them any longer."
Greek economy shrinks 6.9% in a year
12 August 2011, by Simon Kennedy - London (MarketWatch)
The Greek economy contracted 6.9% in the second quarter from the same period year earlier, according to data from the Hellenic Statistical Authority.
The non-seasonally-adjusted figure, which is measured at constant prices of the year 2000, followed an 8.1% annual decline in the first quarter.
The statistics agency said a decrease in domestic demand in the quarter was partially offset by improvements in the external trade balance.
Greece under financial pressure
September 17, 2011 Decision on Greek bailout delayed till October. Less than 75% of private sector creditors will take part to buy back Greek debt,
far less than the 90% target set by Greece, a shortfall that could jeopardize the euro zone's second bailout package for Athens.
WHY should be entire EU finance Greek (or any other) unions? I consider unions communismardian.co.uk/business/2011/sep/16/greece-finance-ministers-bailout-p.
Nothing like a war to unite people unhappy at home
Turkey threatens Cyprus, Greece, Israel
TURKEY, mideast threat
Is September 20 Greek Default Day?
Submitted by Tyler Durden on 09/17/2011 - 14:52
CDS default Greece headlines International Monetary Fund None Poland Sovereigns
If Greece is going to default, September 20th seems to be as good a day as any. Actually, it is far better than most to be GD-Day. Two big bonds, the 4.5% of 2037 and the 4.6% of 2040 both have coupon payments due that day, totalling 769 Million Euro. So if the IMF wanted to avoid letting another billion euro go down the drain, September 20th would be a good day to do it. The IMF seems to have delayed approving another tranche for now, so Greece must already have the money for this payment? The Fed Scheduled their meeting for 2 days. It now starts on September 20th. Maybe a co-incidence, but what better way to be prepared for new emergency policies? CDS "rolls" on the 20th. On the 21st, all Sept 2011 CDS will have expired. My guess is that banks own more protection than they sold to the September 20th date, so defaulting while those contracts are still valid would be a net benefit to the banking system. As a whole, triggering CDS will likely benefit banks as I can find banks that say they own protection against positions, but find more hedge funds are uninvolved or have sold protection to fund shorts in other sovereigns.
New Greece austerity, more riots
September 22, 2011 Thursday
Tougher measures affect pensions, taxes.
Greece is being hit by a 24-hour public transport strike.
Train, bus and taxi services have been crippled and air traffic controllers will stop work for several hours.
Rebellion of public sector workers in Athens.
The government has cut pensions further in order to get euro and IMF aid.
Greece is trying to prevent a default on debt payment.
Greece to default on massive debt
Greece to default on massive debt, European leader
Greece To Track Citizens' Purchases To Solve Tax Evasion Problem
October 6, 2011 The only thing certain in life is death and taxes. Except if you live in Greece, where as the New Yorker’s James Surowiecki puts it, “tax evasion is the national pastime.” To fix the problem, the government is going to start tracking its citizens’ spending in real-time.
Surowiecki and others have attributed much of Greece’s financial woes to its huge untaxed shadow economy, which is estimated to be more than a quarter of its GDP (In the U.S., just 9% of our GDP is in the dark.) Greece has come up with interesting, technological ways to find tax evaders, including looking at satellite images to see how many people were lying about having home pools. While 324 people in one area had reported having a pool on their tax forms, almost 17,000 homes in that area in fact had water-filled holes in the ground in their backyards when viewed from above. (Thanks, Google Maps!)
Some studies suggest that Greece is missing out on $30 billion in taxes, so the cash-strapped country is trying something new: forcing consumers to track their spending with a government-issued tax card.
The cards look like credit cards, but contain no personally identifiable information beyond the person’s tax id number. They will swipe during a purchase; the amount of the sale will be sent to their bank; and then the banks will report the spending to the Ministry of Finance at the end of each month, according to the Greek Reporter. The cards, made available at Greek banks this week, are voluntary (for now).
According to the GR Reporter, the cards followed a law in 2010 that requires Greeks to produce receipts accounting for how they spent 25% of their declared annual income. The card will make it easier to do that, through digital capture. In a way, it could even be more privacy protective in that the cards will capture only the amount spent, not what it was spent on (as a receipt would). Though purchases at some places — like Aphrodite’s Palace — may lead to some guesses about the nature of the goods.
Surowieki wrote that “the reason tax reform will be such a tall order for Greece, in sum, is that it requires more than a policy shift; it requires a cultural shift.” Perhaps knowing that Big Brother is watching every loosening of the purse strings will help accomplish that.
Time short for eurozone
October 09, 2011 David Cameron has urged European leaders to take a “big bazooka” approach to resolving the eurozone crisis, warning they have just a matter of weeks to avert economic disaster.
The UK prime minister wants France and Germany to bury their differences and to adopt before the end of the year what he claims would be a decisive five-point plan to end the uncertainty,
which was having a “chilling effect” on the world economy.
Greece shuts down in 48-hour strike
Oct. 19, 2011 A 48-hour general strike has grounded flights, disrupted public transport and shut down everything from customs offices to shops and schools in Greece.
All sectors, from dentists, state hospital doctors and lawyers to shop owners, tax office workers, pharmacists and dock workers walked off the job today as unions lash out at another round of austerity measures to be voted on by MPs on Thursday.
Police were deployed on the streets ahead of planned demonstrations, blocking a major road passing by parliament and shutting down two metro stations.
Demonstrations during a similar 48-hour strike in June left the centre of Athens convulsed by violence as rioters torched cafes and clashed with police.
Flights were grounded in the morning but were to resume at noon after air traffic controllers scaled back their initial strike plan from 48 hours to 12.
Ferries remained tied up in port, while public transport workers staged work stoppages but were to keep buses, trolleys and the Athens metro running for most of the day.
Ilias Vrettakos, deputy president of the civil servants' union ADEDY, said the strike could be the largest in decades.
"The fact that other sections of society that are suffering from government policies are also participating gives a new dimension to the social resistance by workers and the people in general, and we hope that this mobilisation will have an impact on political developments."
Piles of rubbish continued to fester on street corners despite a civil mobilisation order issued on Tuesday to order bin lorry crews back to work after a 17-day strike. Earlier in the week, private crews were contracted to remove rubbish from along the planned demonstration routes, but mounds remained on side streets and in city neighbourhoods.
Protesting civil servants have also staged sit-ins at government buildings, with some, including the finance ministry, under occupation for days.
Prime minister George Papandreou appealed on Tuesday for the protests to end.
"I would like to ask all those who occupy ministry buildings, choke the streets with garbage, close off ports, close off the Acropolis, if this helps us stand on our feet again - of course it does not," he told parliament.
Most stores in the city centre, including bakeries and many of the ubiquitous kiosks which sell everything from newspapers, cigarettes and chewing gum to tourist trinkets and snacks, were shut. Several shop owners said they had received threats that their stores would be smashed if they attempted to open during the first day of the strike.
The measures to be voted on in Parliament tomorrow come after more than a year and a half of repeated spending cuts and tax increases, and include tax hikes, further pension and salary cuts, the suspension on reduced pay of 30,000 public servants out of a total of more than 750,000, and the suspension of collective labour contracts.
A Communist party-backed union has vowed to encircle Parliament tomorrow in an attempt to prevent deputies from entering the building for the vote.
The reforms have been so unpopular that even some MPs from the governing Socialists have indicated they might vote against at least some of them.
But Greece must pass the bill if it is to continue receiving funds from its 110 billion euro international bailout. Unless it receives the now long overdue disbursement of an 8 billion euro instalment, it has said it will run out of funds to pay salaries and pensions by mid-November.
Meanwhile, European countries are trying to work out a broad solution to the continent's deepening debt crisis, ahead of a weekend summit in Brussels.
It became clear earlier this year that the initial bailout for Greece was not working as well as had been hoped, and European leaders agreed on a second, 109 billion euro bailout. But key details of that rescue fund, including the participation of the private sector, remain to be worked out.
October 21, 2011 BERLIN (AP)
Greece's international debt inspectors warn that a second bailout for the country tentatively agreed in July does not make its massive debts sustainable.
They say in a report that while the July 21 deal reduced Greece's immediate financing needs, "this could not suffice for the debt dynamics to be described as sustainable" if implementation of reforms by Greece remains weak.
The conclusion was made in a review of Greece's first bailout program by the European Commission and the European Central Bank, a copy of which was obtained by the Associated Press.
The report adds tension to discussions among EU leaders in which Germany is pushing for Greece's private creditors to take bigger losses on Greek than the 21 percent agreed in July.
Greece adopts austerity bill, 1 dead in riots
October 21, 2011 Athens
Coming soon to USA ... err .. coming? its here, with the OWS.
Cutting union public sector wages and raising taxes.
A union member taking part in anti-austerity protests has been killed.
The Greek parliament approved a painful set of austerity measures, defying riots in Athens and a general strike which shut down much of the country.
This should ensure the EU and International Monetary Fund release a vital 8 billion euro ($11 billion) loan which the government needs to keep paying its bills past November.
The mix of deep pay and pension cuts, tax hikes and changes to collective bargaining agreements has been bitterly opposed.
It is time for all of us now to assume our collective responsibility.
Banks agree to take big loss
27 October 2011 Brussels
Leaders agree on eurozone deal
Europe agree to rescue Greece
German chancellor Merkel wants permanent supervision of Greece
Peace should not be taken for granted if the euro fails.
Germanys own state assets could be taken as collateral.
European Union leaders announced an agreement on debt crisis measures, including a deal with private sector investors to take a 50% loss on Greek bonds.
The deal will reduce Greek debt to 120 percent of its GDP in 2020.
Banks must also raise more capital to protect them against losses resulting from any future government defaults.
The deal is aimed at preventing the crisis spreading to larger eurozone economies like Italy.
Greek default is just a matter of time
Obama to pitch economic program at Group of 20 summit
October 30, 2011
President Obama, who has struggled to advance his vision for economic renewal at home, will take his pitch overseas this week to an audience of world leaders who could prove equally skeptical of his message at a time of global anxiety.
“It’s very hard for us to preach the economic gospel to Europe when they watched our debt-ceiling debate here and our [credit-rating] downgrade,” said Heather Conley, director of European programs at the Center for Strategic and International Studies (CSIS).
Obama is scheduled to depart Washington late Wednesday for a two-day trip to Cannes, France, where the heads of the world’s 20 largest economies will gather for the Group of 20 summit. Organizers said the meetings will focus on how to contain Europe’s debt crisis while also trying to forge consensus on a path to stimulating worldwide economic growth, even as many countries, including the United States, wrestle with painful budget cuts.
The trip, the first for Obama outside the United States since he attended a smaller summit in France in the spring, could provide a crucial test of whether his political problems at home have compromised his influence abroad.
In the five months since the last global summit, Obama has focused on the domestic economy, fighting with Congress over ways to reduce the deficit and crisscrossing the nation to promote his $447 billion American Jobs Act, which remains stalled on Capitol Hill.
At a series of bilateral meetings in France, the president is expected to lay out his growth proposals: a mix of immediate spending to create jobs and longer-term fiscal discipline to reduce U.S. deficits.
But Obama faces a tough challenge after pointedly criticizing Europe’s handling of its debt crisis. During a town-hall-style event in Mountain View, Calif., last month, Obama said the Europeans were “scaring the world.”
European leaders struck back, telling administration officials to butt out and focus on their own fiscal problems. The Austrian and German finance ministers chided U.S. Treasury Secretary Timothy F. Geithner in September for intervening in Europe’s affairs, with Germany’s Wolfgang Schauble dismissing as “stupid” a bailout idea advanced by Geithner. White House officials counter that the bailout plan adopted last week by European nations to help cash-strapped countries such as Italy and Spain borrow at least a trillion dollars is similar to an idea that Geithner proposed.
“The president said Europe was scaring the world; Europe thinks the U.S. is scaring the world,” said CSIS’s Conley, who was deputy assistant secretary of state for European and Eurasian affairs from 2001 to 2005. “We’re both finger-pointing at one another. I do not think the president has lost legitimacy, but it’s just very hard for us to tell other countries what to do.”
On his national jobs tour, Obama has consistently cited Europe’s economic malaise, along with the Japanese earthquake and the uprisings in the Middle East, as factors that have slowed the U.S. economic recovery. The president has called on Europe to take bold action to resolve its debt crisis.
November 2, 2011 Wednesday
|Leave the Euro zone Although not a given if Greece rejects the rescue package, the country may very likely decide to exit the Euro zone and return to the drachma. Landon Thomas, Jr. at The New York Times explains the downsides to that. "Default on the nation’s $500 billion in public debt would become a certainty, depositors would take their money out of local banks and, with a sharp devaluation of as much as 50 percent, inflation would loom. A return to the international credit markets would take years," he writes. Additionally, John Cassidy notes that "the country’s banking system would probably collapse—it’s pretty much a basket case already—inflation would rise, and there would be a period of chaos." |
France, Germany give Greece ultimatum on euro
..CANNES, France (Reuters) - The leaders of Germany and France told Greece on Wednesday it would not receive another cent in European aid until it decides whether it wants to stay in the euro zone.
They also made clear that saving the euro was ultimately more important to them than rescuing Greece.
After emergency talks with Greek Prime Minister George Papandreou, German Chancellor Angela Merkel said: "We would rather achieve a stabilization of the euro with Greece than without Greece, but this goal of stabilizing the euro is more important."
Sarkozy hammered home the same message, telling a joint news conference with Merkel: "Our Greek friends must decide whether they want to continue the journey with us."
Papandreou outraged European partners and caused panic on financial markets by announcing on Monday that Greece would hold a referendum on a second bailout plan negotiated with euro zone leaders last week.
The Greek leader, looking chastened after a torrid dinner with European Union decision-makers that Merkel called "tough and hard" on the eve of a summit of G20 major world economies, said the plebiscite would take place around December 4.
"It's not the moment to give you the exact wording, but the essence is that this is not a question only of a program, this is a question of whether we want to remain in the eurozone," Papandreou said.
Despite opinion polls showing a majority of Greeks, weary of two years of deepening austerity, think the bailout package was a bad deal for Greece, he said he expected more support from the wider population than he could muster in parliament.
"I believe the Greek people are wise and capable of making the right decision for the benefit of our country," he said.
Sarkozy and Merkel said euro zone finance ministers would meet next Monday to speed up decisions on leveraging the euro zone's rescue fund to build a firewall to protect other weaker members of the 17-nation currency area.
The EU and IMF said Greece would not receive an urgently needed 8 billion euro ($11 billion) aid installment, due this month, until after the vote because official creditors wanted to be sure Athens would stick to its austerity program.
European Commission President Jose Manuel Barroso delivered this message to Papandreou before his arrival in Cannes, EU sources said.
This was after the Greek leader sent a letter to EU leaders saying he wanted to negotiate the details of the second package before the referendum, they said. The letter angered European officials, raising the level of mistrust toward Greece.
Papandreou said Greece had enough money to keep running until mid-December, when it has to redeem more than 6 billion euros in debt.
WEEKS OF UNCERTAINTY
Sarkozy's office said several euro zone leaders attending the G20, including the Spanish and Italian prime ministers, would meet on Thursday morning in Cannes to review the crisis.
In fresh signs of the market turmoil unleashed by the Greek move, the euro zone's EFSF rescue fund, which lends money to troubled member states, was forced to put on hold plans to raise 3 billion euros in the bond market.
And Italy's financial stability panel said some Italian banks were having difficulty raising money on international markets.
Asian G20 members piled pressure on Europe to tackle the crisis before it wreaks serious harm on the world economy.
China's deputy finance minister, Zhu Guangyao, said he hoped the uncertainty over the Greek referendum could be contained, adding that Beijing could not consider investing more in the euro zone's bailout fund given the lack of detail on proposals to leverage it.
South Korean President Lee Myung-bak said the G20 must act swiftly and boldly to contain the crisis, which was spilling over to the rest of the world.
If Papandreou loses the referendum, Greece faces a disorderly default which would hammer Europe's banks and threaten the much larger economies of Italy and Spain, which the bloc may not have the means to bail out.
The chairman of euro zone finance ministers, Jean-Claude Juncker, said Greece could go bankrupt if voters rejected the bailout package and Japanese Finance Minister Jun Azumi said: "Everyone is bewildered."
Juncker, Barroso, European Council President Herman Van Rompuy, IMF chief Christine Lagarde and a senior European Central Bank official attended Wednesday's talks in the southern French resort town.
ECB IN SPOTLIGHT
Doubt about Europe's ability to contain the debt crisis has once more sent markets into a spin and put Italy firmly in the firing line.
The risk premium on Italian bonds over safe-haven German Bunds hit a euro-lifetime high on Tuesday, despite European Central Bank buying of its bonds.
Italian Prime Minister Silvio Berlusconi scrambled to come up with measures to placate markets, holding an emergency cabinet meeting to accelerate budget reforms amid mounting calls for his resignation.
Ireland's finance minister said the ECB would be forced to pledge "a wall of money" to buy bonds, something many of its policymakers are deeply uncomfortable about.
Until the Greek situation is clearer, last week's package of measures is likely to be in limbo, leaving the ECB as the only bulwark against market attacks.
The head of Germany's banking association, Michael Kemmer, said agreement on a 50 percent writedown of Greek debt by its private creditors would have to wait. "I can't imagine a debt exchange taking place before the referendum," he said.
The Greek press, including dailies traditionally friendly to the government, almost unanimously condemned Papandreou.
Center-left newspaper Eleftherotypia described the prime minister on its front page as "The Lord of Chaos". Ethnos, another pro-government paper, called the referendum "suicidal".
(additional reporting by Dina Kyriakidou in Athens, Gernot Heller, Lesley Wroughton, Luke Baker and Gui Qing Koh in Cannes, and James Mackenzie in Rome; writing by Paul Taylor; editing by Noah Barkin)
Greek Exit From Euro Zone Just a Matter of Time
November 3, 2011
Last week, it looked as though the euro had been saved. Now, in the wake of Greek Prime Minister Papandreou's announcement of a national referendum on the bailout package for his country, the common currency is even closer to the abyss. Still, say German commentators, it may have been the right move.
Despite its location on France's glamorous Cote d'Azur, Wednesday evening's meeting likely won't be a pleasant one for Giorgios Papandreou. The Greek prime minister is set to meet with German Chancellor Angela Merkel and French President Nicolas Sarkozy. None of them, one presumes, will be in the mood to enjoy their enchanting surroundings.
Leaders of the world's most powerful economies begin arriving on France's south coast on Wednesday night for the Thursday kick-off of this year's G-20 summit. Host Sarkozy had been hoping the gathering would focus on raising funds to boost the effectiveness of the euro backstop fund, the European Financial Stability Facility (EFSF), but the success of the meeting is now in doubt. Papandreou's announcement on Monday evening that he was planning to hold a referendum on the EU bailout package for his country has shocked and infuriated his would-be benefactors -- and sent global markets into yet another tailspin.
The news came less than a week after an all-night bargaining session in Brussels that resulted in an agreement to slash Greek debt by 50 percent, make a further €130 billion in loans available to the country and leverage the EFSF to €1 trillion. Markets immediately calmed and the euro began climbing against the dollar.
The Greek prime minister's announcement, however, quickly transformed the budding optimism into deep pessimism about the future of the common currency. Should Greek voters, frustrated by round after round of deep austerity measures, reject the bailout deal, it could result in an uncontrolled national bankruptcy. Markets will likely remain nervous until the results of the ballot are in -- meanwhile the euro will move even closer to the abyss.
As if to highlight the dangers, German banks on Wednesday announced they were postponing their acceptance of the Greek debt haircut until after the referendum. Without voluntary bank approval, Greece faces a disorderly bankruptcy which could accelerate contagion throughout the euro zone.
Papandreou's decision, said European Commissioner for Energy Günther Oettinger, "puts the euro in even greater danger."
Still, not everyone was completely repulsed by Papandreou's decision. After all, the Greeks are being asked to put up with severe belt-tightening measures and providing those austerity packages with even more democratic legitimacy could take the wind out of the sails of those who would protest them. The cabinet in Athens on Wednesday unanimously approved the referendum plan. It remains unclear exactly when the referendum might take place, but some officials hinted on Thursday that it could happen before the end of the year.
German commentators on Wednesday take a look at the impending referendum.
"There are many who have, since Monday, been posing the impolite question: Has the Greek prime minister gone crazy? The answer is 'no.' Papandreou merely recognized that his back is to the wall as never before - and that he will have just as much trouble selling last week's bailout package to the Greek public as he has the radical austerity path his government has followed. Greece's debt crisis has long since become a crisis of democracy. Given this situation, Papandreou decided to take the option of last resort."
"There is much to criticize: the lack of coordination with his European partners; the apparent lack of a real plan to present to his countrymen and women. Most of all, however, his apparent indifference to the collateral damage a negative vote would have for Europe and its common currency."
"It is a risky bet. If, however, Papandreou ... is able to convince his people of the correctness of his path, then the euro bailout efforts would be on much more stable ground than has been the case thus far."
"As tough as it sounds, Greek politics is no longer just the business of the Greeks alone. ... Greece's fate also determines that of the other 16 euro-zone members. And if it's true that the future of the European Union hangs on the euro, then the entire project is in jeopardy. The summits in Brussels last week were an expression of the responsibility that Europe is willing to take on for Greece. But where then is Greece's responsibility for Europe?"
"With his unilateral decision to hold a referendum, Papandreou has tossed Europe back into the uncertainty of the days before the EU summit. Worse still, while it was at least possible to take steps forward in the last few weeks, now a complete standstill looms. What further steps could possibly be taken when no one will know for weeks, or perhaps months, how much longer Greece will remain part of the euro?"
"Giorgios Papandreou has some hard months behind him. The courage and political resolution that he has shown so far deserve the highest respect. One can even understand that the prime minister finally wants some clarity, and not least to discipline the destructive opposition in his country. Therefore it wouldn't be just bitter irony if he were to lose in the parliamentary vote of confidence or later in the referendum. It could also be very expensive for Europe."
"The Greek exit from the euro zone seems like only a matter of time. This doesn't mean an end to European solidarity. Greece will certainly need further support from its partners. But an exit would only be the very late acknowledgment of economic realities. Only with a national currency do the Greeks have any real chance of strengthening their competitiveness through currency devaluation."
"But even this radical step won't quiet the situation in Europe. The fear that Italy will also begin to tumble has long worried the financial markets.... Should debt-plagued Italy need to take shelter under the rescue fund, none of the EU resolutions made thus far would be adequate. Then the conflict between Germany and France over whether we're willing to give all we have to guarantee the indebted countries will start anew. And that would mean that measures successfully rejected so far by Chancellor Angela Merkel -- such as euro bonds or a bank license for the European rescue fund -- would be back on the table."
"The Greek prime minister is comparable to a Roulette player who bets everything on a single number. And unfortunately it seems like he's not the only gambler among Europe's politicians."
The center-right Frankfurter Allgemeine Zeitung writes:
"Papandreou, who could fall any day, is playing a game of 'all or nothing.' ... That could lead some Germans -- who may no longer feel represented by the unanimity of German political parties on European issues -- to question why Greeks are allowed to vote on the bailout package even as Germans aren't allowed to vote on whether they and their children want to shoulder billions for this purpose. That could clarify why the outrage over this news from Athens is so great in Berlin."
The left-leaning daily Die Tageszeitung writes:
"Predictions that the Greek voters will reject the debt haircut are too premature. Most know that their country would have been bankrupt in November without bailout measures. But they also know that the 'haircut' from Oct. 26 also won't protect them from being scalped in the end. It's clear to everyone that the rigorous austerity measures that are strangling their future prospects will continue."
"To mobilize the voters, Papandreou must emphasize what the EU debt haircut agreement has brought them -- the promise that their country won't be shut out of the euro zone. A return to the drachma is a nightmare scenario for two-thirds of the population. But even an affirmation in a referendum won't end the protests against the austerity measures. The prime minister's high-wire act will continue even if he's victorious."
Financial daily Handelsblatt writes:
"It would probably be best for the euro zone if Greek Prime Minister Papandreou lost the parliamentary vote of confidence at the end of this week. Then it would be clear that Greece would denounce its partners and the euro zone could concentrate on countries, like Ireland and Portugal, which are determined to contribute for their part of the rescue fund."
"Internally Greece is so divided that one can no longer be sure if the will for self-help survives. And a drowning person who throws the life preserver back can't be saved."
"The question is, however, whether there is still enough time to wait out the referendum, and whether, after the last two years of the Greek drama, another quarter of a year of uncertainty is imaginable. ... Euro-zone politicians have hardly any other choice but to avoid another months-long cliffhanger. That could be successful if the irresponsible conservative opposition is finally put under some serious pressure. Europe could turn the tables and begin a game of blackmail by threatening to take back the rescue aid if Greece doesn't quickly clear things up. But that would be risky too -- and it also means more waiting."
Greek govt teeters, lawmakers urge PM to resign
November 3, 2011 ATHENS, Greece (AP)
Greek Prime Minister George Papandreou came under intense pressure Thursday from his own party and opposition lawmakers alike to resign and let a coalition government approve a European bailout plan instead of holding a risky referendum on it.
Papandreou's unexpected announcement Monday that he intended to put the hard-fought bailout package to a referendum horrified Greece's international partners and creditors, triggering turmoil in financial markets as investors fretted over the prospect of a disorderly default and the country's exit from the 17-nation eurozone.
The instability in Greece has sent immediate ripples throughout Europe. Premier Silvio Berlusconi's government in Italy was teetering as well after it failed to come up with a credible plan to deal with its dangerously high debts, and Portugal demanded more flexible terms for its own bailout. European Central Bank made a surprise decision Thursday to cut interest rates by a quarter of a percentage point to 1.25 percent, responding to the financial turmoil.
The drama also dominated the G-20 meeting in the French resort of Cannes, where the leaders of the world's economic powerhouses had gathered to solve Europe's debt crisis, which threatens to push the world back into recession.
Papandreou was holding an emergency meeting Thursday with his ministers. Several of them called for a coalition national unity government that would approve the bailout package without a referendum and make sure the country receives vital funds to prevent imminent bankruptcy.
The latest turmoil began after Papandreou's own finance minister, Evangelos Venizelos, broke ranks with him Thursday and declared his opposition to a referendum.
"Greece's position within the euro area is a historic conquest of the country that cannot be put in doubt," Venizelos said, adding that it "cannot depend on a referendum."
Venizelos said the country's attention should be focused on quickly getting a crucial €8 billion ($11 billion) installment of bailout funds, without which it faces bankruptcy with weeks.
Rumors abounded about a possible Papandreou resignation — but two officials in his office denied reports that he would visit the country's president and tender his resignation in the afternoon. The president's office also said it had no knowledge of such a meeting.
State TV said lawmakers were sounding out former European Central Bank vice president Lucas Papademos as a possible unity government leader.
Several of Papandreou's close associates said they did not know what his intentions were, but he was delivering a speech to his ministers.
"He wrote the speech himself. Nobody knows what's in it," said one close associate who spoke on condition of anonymity to discuss the prime minister's actions.
Papandreou has also called a confidence vote his is government for Friday night — although with mounting pressure, it was unclear if the government would survive that long. Socialist lawmaker Eva Kaili said she would not back the government in the vote. Without her support, the Socialists' majority for the vote would be down to a bare minimum of 151 in the 300-member parliament.
One Socialist party official said Papandreou was determined to remain in his position at least until the vote.
"The prime minister will deliver his speech as planned tonight (during the confidence vote debate) and the confidence vote will be held normally on Friday," the official said on condition of anonymity as he was not authorized to discuss the matter with the press.
He said Thursday's cabinet meeting was expected to last "for several hours."
Antonis Samaras, the leader of the conservative opposition, called for a transitional government to ratify the European debt deal and prepare for early elections.
"Under the weight of these dramatic events, we have witnessed a crisis of the ability to govern. The country must immediately return to a state of normality," Samaras said. "Under the current conditions, the new debt deal is unavoidable and must be safeguarded."
A party official said the conservatives' call was for a transitional government that would not include members of any political party members, and especially not their own. The official spoke on condition of anonymity to disclose the party's thoughts.
If the Greek government falls, it would mean that every EU nation that had already received a bailout — Greece, Portugal and Ireland — saw their governments fall during the economic turmoil.
The strong Greek rejection of Papandreou's referendum proposal helped calm frayed nerves in the markets. Athens' main stock market outperformed its peers, rising 4 percent in midday trading following three days of big falls.
In Cannes, French President Nicolas Sarkozy and German Chancellor Angela Merkel told Papandreou on Wednesday night that any referendum should be on whether Greece wants to stay in the eurozone or not, suggesting that it be held no later than Dec. 4. They said the country would not get the next €8 billion ($11 billion) batch of its existing bailout until after the vote.
Greece's new debt deal would give the country an extra €100 billion ($138 billion) in rescue loans from the rest of the eurozone and the IMF — on top of the €110 billion ($152 billion) it was granted a year ago — and would see banks forgive Athens 50 percent of the money it still owes them.
Speaking in Cannes, Papandreou said he was forced to call the referendum after it became clear there was no "broad support" from opposition parties for the bailout deal reached with the rest of the eurozone and big banks just a week ago.
Turning the referendum into a popular vote on whether Greece wants to remain in the eurozone is a risky bet that could lead to turmoil throughout the bloc.
"We cannot permanently ride a rollercoaster on Greece; we have to know where things are going, and the Greeks have to tell us where they would like things to go," Jean-Claude Juncker, who chairs eurozone finance ministers' meetings, told Germany's ZDF television Thursday.
Greek government on brink of collapse
..ATHENS (Reuters) - The Greek government teetered on the brink of collapse on Thursday over plans for a referendum on a euro zone bailout with turmoil in the ruling party casting grave doubt on whether Prime Minister George Papandreou can survive a confidence vote.
Conservative opposition leader Antonis Samaras demanded that a transitional government be formed immediately to run the country until snap elections, with the current parliament ratifying the financial rescue for debt-choked Greece.
State television and the state ANA news agency said that Papandreou would meet the Greek president after an emergency cabinet session on Thursday, without giving further details.
Papandreou would have to submit his resignation or a request for a unity government to President Karolos Papoulias.
Papandreou's chief of staff denied the prime minister intended to resign although sources within his PASOK socialist party said some senior lawmakers wanted a Greek former top official at the European Central Bank to head a new government.
"I don't think the government will last until tonight," said Costas Panagopoulos, managing director of pollsters ALCO.
Papandreou's surprise decision to call a referendum on the 130 billion euro bailout to save Greece from bankruptcy and prevent a global financial crisis provoked an uproar at home and across the euro zone.
Rejection of the package, which includes yet more austerity measures for the long suffering Greek electorate, would unravel the euro zone's plan for tackling its wider debt crisis, and cut off Greece's international financial lifeline.
Finance Minister Evangelos Venizelos broke ranks with Papandreou, coming out against holding the referendum after a bruising meeting with the German and French leaders, who made clear that Greece would not receive a cent more in aid until it votes to meet its commitments to the euro zone.
"REFERENDUM IS DEAD"
Chaos over Greece's role in the euro zone swept financial markets with early losses in stocks and the euro turning to gains on hopes Athens might ditch its referendum plans.
The Greek stock exchange rose 4 percent on speculation the referendum would be abandoned. World stocks as measured by MSCI were flat after earlier being sharply lower.
In Europe, the FTSEurofirst 300 lost 1 percent initially but later stood close to 1 percent higher. Earlier, Japan's Nikkei closed down 2.2 percent.
"The referendum is dead," Greek ruling party lawmaker Nikos Salayannis said on state radio.
The cabinet was due to hold an emergency session followed by a likely meeting of PASOK lawmakers amid speculation that they will call on him to resign.
However, his chief of staff Regina Vartzeli rejected the idea. "The prime minister has not resigned and does not intend to resign," she told the website of Proto Thema newspaper.
Nevertheless, plotting was in full swing. A small group of senior PASOK lawmakers are preparing a proposal for a coalition government headed by former European Central Bank Vice President Lucas Papademos, party sources told Reuters.
The group was trying to convince Papandreou to quit and open the way for Papademos, a respected figure in Greece, to head a so-called "unity" government to pull the nation from the brink.
One PASOK lawmaker said she would not support the government in a parliamentary vote of confidence on Friday, cutting its majority for that vote to just one.
PASOK has 152 deputies in the 300-member parliament. Lawmaker Eva Kaili announced she would stay in the party but refused to support the government in the confidence vote expected late on Friday, meaning Papandreou could count at most on the support of 151 deputies.
If the government fell and snap elections were called, the referendum would be canceled. The bailout would have to be approved by the next parliament that emerges from elections.
Some lawmakers are calling for a government of national unity which would have the job of getting the bailout through parliament before calling early elections. But the main opposition New Democracy has repeatedly refused cooperation.
Venizelos, one of the most powerful men in the PASOK government, originally supported Papandreou's plan. His change of mind came after he and Papandreou attended an emergency summit in Cannes on Wednesday with German Chancellor Angela Merkel and French President Nicolas Sarkozy.
A finance ministry source told Reuters on condition of anonymity that Venizelos believed the vote on the bailout, which was agreed by euro zone leaders only last week, should not be held while immediate funding to keep Greece afloat still had to be secured.
A VERY DIFFICULT MEETING
"Under these conditions a referendum is exactly what the country does not need. He would not have objections if all our pending issues such as the loan installment and the completion of the bailout plan had been sorted out," the source said after the meeting with Merkel and Sarkozy.
"It was a very difficult meeting," the source added.
Papandreou's bombshell announcement on Monday of the referendum and parliamentary vote of confidence pitched Greece into a political as well as an economic crisis.
About 10 PASOK lawmakers have publicly called for a coalition government to approve the EU bailout deal and proceed to new elections. About 15, including five ministers and deputy ministers, have rejected the referendum idea.
PASOK lawmaker Costas Gitonas said the referendum should not take place. "No, by no means," he told Mega TV. "It's a madhouse."
The spectre of a hard Greek default and euro exit hung over a meeting of G20 leaders beginning in Cannes on Thursday.
The French Riviera summit had been meant to focus on reforms of the global monetary system and steps to curb speculative capital flows, but the shock waves from Greece have upended the global talks.
(Additional reporting by Reuters Athens bureau; Writing by David Stamp; Editing by Mark Heinrich)
Exclusive: Greek Prime Minister George Papandreou has struck a deal with ministers to step down and hand power to a negotiated coalition government if they help him win a confidence vote on Friday, government sources with knowledge of a cabinet meeting said.
I wonder what this means - the same guy who wants the Reforendum agrees to step down IF they help him win a "confidence vote"? Sounds like the train is speeding faster...
Things look like it could really be heating up now - I read that the vote on the Greece Reforendum could be on 12/4, however, if they don't get any bailout money soon, they will be forced to default as early as this mid-month, as they have their bills to pay by then.
Bank exodus from euro zone sovereign debt quickens
3 November 2011
(Reuters) - Banks including BNP Paribas and ING are ditching billions of euros of euro zone government bonds, cutting their exposure to the region's trouble spots.
..Analysis: Leaving the euro carries massive costs
By DON MELVIN - Associated Press | AP – 2 hrs 44 mins ago..
...An coin trader holds a euro coin above old Greek drachma that was replaced by the …
.Death toll from listeria outbreak rises
8 photos - Tue, Oct 4, 2011Herman Cain denies harassment claims
76 photos - Tue, Nov 1, 2011WikiLeaks founder Julian Assange
7 photos - Wed, Nov 2, 2011...See latest photos »....BRUSSELS (AP) — European leaders have struggled mightily to keep Greece in the eurozone, despite the drag that its economic weakness places on their growth. The reason is this: If Greece abandons the euro, the chaos it would wreak on the global economy can hardly be overstated.
A Greek exit from the euro would almost certainly cause the country to default completely on its debts. A bankrupt Greece would be unable to pay pensions and salaries, and there would be a run on banks, causing them to collapse as people lined up to withdraw euros before the currency changed to drachmas.
Greeks owing money in euros but being paid in drachmas — essentially, a huge currency devaluation — would find their debts suddenly too large to pay, and would go bankrupt themselves. In a country where street violence accompanies even minor civil servant demonstrations, that's a volatile mix.
And for any help, the only place Greece would be able to turn would be the International Monetary Fund, which is already one of its bailout creditors and would insist on even more austerity measures in return for rescue loans, bringing the entire equation full circle.
Beyond Greece, the consequences would be even more dire.
Rather than 50 percent losses on Greek bonds that the banks have already said they can handle, private creditors would see those bonds simply disappear. Eurozone countries, the European Central Bank and the IMF would also give up hope of getting back the money they lent Greece.
Above all, a messy default would trigger massive insurance payouts on those bonds. Because financial groups do not usually disclose how much they hold in sovereign debt, such as Greek bonds, global markets would be seized by a panic over who would collapse.
That would essentially be a repeat of what happened in 2008 after U.S. investment bank Lehman Brothers failed — only worse.
The uncertainty would likely push other weak eurozone states like Italy and Spain from chaos into disaster. And failures that size would destroy the euro altogether.
Already, Italy's borrowing rates have jumped to record levels at the mere thought of a Greek default. If Greece does default, investors would be prone to think that other countries might, too — and they know full well that Italy's economy is too big for Europe to bail out.
French President Nicolas Sarkozy claimed it would never come to that.
"We cannot accept the explosion of the euro, which would mean the explosion of Europe," he said in Cannes at a summit of leaders from the Group of 20 most powerful economies.
But Europe's defenses are still weak. If it were aggressive in buying national bonds, the European Central Bank might be able for a time to keep a lid on those borrowing costs before they rose to the point that Italy's government would no longer be able to finance itself on capital markets.
On the other hand, if the ECB were to shy away from such an approach then the risk of contagion would grow. The ECB made clear Thursday it is uncomfortable playing such a role.
Greece appeared to step back from the brink on Thursday and canceled plans for a referendum. If its feuding politicians can agree to the plan launched in Brussels last week, they'll get the next batch of euro8 billion ($11 billion) in bailout money.
But even then, the problems are far from over.
True, the agreement would reduce Greece's debt — but not by much. In 2020, in the best scenario, Greece would have the same level of debt that it did three years ago.
When the crisis began.
Greek PM scraps referendum on Greek debt plan
November 3, 2011 Thursday ATHENS, Greece (AP)
Greece's prime minister abandoned his explosive plan to put a European rescue deal to popular vote and opened emergency talks Thursday with his opponents, demanding their support in parliament to pass the hard-fought agreement into law.
Prime Minister George Papandreou changed his mind after a widespread rebellion from within his own Socialist party over the referendum idea, but ignored repeated calls to resign. He faces a critical vote of confidence in his government Friday.
Papandreou sparked a global crisis Monday when he announced he would put the latest European deal to cut Greece's massive debts — an accord that took months of negotiations — to a referendum. The idea horrified other EU nations and Greece's creditors, triggering turmoil in financial markets as investors fretted over the prospect of Greece being forced into a disorderly default.
Papandreou was summoned to an emergency European meeting in Cannes, France, on Wednesday night, where the visibly irate French and German leaders said any referendum would in fact be a question of whether Greece retains its cherished membership of the euro common currency. They also said Greece would not receive the next, vital €8 billion ($11 billion) installment of its existing bailout until after a vote was held.
Finance Minister Evangelos Venizelos accompanied him — and led a revolt against the referendum idea on his return to Athens before dawn Thursday.
With Greece's euro membership and bailout loan lifeline suddenly in danger, pressure mounted for Papandreou to resign, with the conservative opposition and even his own deputies calling for the creation of a transition government to pass the new European debt deal.
Venizelos said as the opposition now indicated it would support the European debt deal, a referendum was no longer necessary.
"The government went to Cannes with the position that if the necessary consensus is formed there will be no need to hold a referendum," he said.
"We must highlight the fact that there is a window of a consensus that even late, even under conditions, can change the climate under which the Oct. 26 decisions will be implemented and voted," Venizelos said. "This development, irrespective of motives is particularly beneficial for the country."
He said the new debt deal would be brought to parliament under a procedure that would require a super-majority of 180 lawmakers to vote in favor. With the governing Socialists holding 152 seats, that means the debt deal will only pass if the opposition votes in favor.
So now that Greece has abandoned their reforendum deal, they still need their Parliament to pass the new debt deal for the euro, meaning the opposition party(Socialists) have to vote for it.
Dunno - the last paragraph sounds, well...one minute they say everything's all good, the next minute, well...
Despite the reforendum being scrapped...
November 3, 2011 Thursday
After Greece, Italy - Berlusconi Could Be Forced to Resign
Greece appeared to take a step back from the brink of a debt default Thursday as Prime Minister George Papandreou, under fire from the opposition and members of his own party, backed away from a surprise call for a referendum on whether to accept the terms of the latest bailout package for the heavily indebted country. With Papandreou’s fate hanging on a confidence vote scheduled for Friday that he is in danger of losing, market focus has increasingly turned to Italy, which poses true systemic risk to the European Union. A disorderly default in Greece would raise the ante for Italian Prime Minister Silvio Berlusconi, who would probably be forced to resign, analysts at Barclays said.
Last week’s three point plan unveiled by Euro area leaders, led by Merkel and Sarkozy, which delineated the framework for an expanded EFSF, bank recapitalization, and a second Greek bailout, sparked a substantial relief rally. So substantial that it was clearly an overreaction.
Markets quickly tumbled as Greece’s Papandreou called for a confidence vote and a referendum, putting his political career, and the fate of the EU, to a certain extent, on the line. Yields on Italian 10-year bonds surged well past the key 6% mark, even reaching a 450 basis point spread over German bunds.
The possibility of a disorderly default in Greece is now higher than ever. Without the next €8 billion tranche of bailout money, Barclays estimates Greece has money up until some point in December. The next tranche would allow the troubled country to fund itself until February or March. Barclays now believes that Papandreou will lose the confidence vote, if indeed it goes through, sending markets further down and putting pressure on the whole system.
“With Italian government bond yields signaling increasing stress in this key segment of the EGB market, the negative feedback loop into euro area banks is likely to persist, as it amplifies the risk of a credit crunch emerging at least in parts of the eurozone,” explained the analysts.
A disorderly default in Greece would cause German bunds to rally and would push Italian yields even higher. Italy’s problem is not one of solvency, but of an excessive debt-to-GDP ratio and deep-rooted structural problems, according to Barclays. Rising borrowing costs, though, will raise the heat substantially in Italy, where Prime Minister Berlusconi is already under fire.
The final outcome in Italy appears to be Berlusconi’s resignation, according to Barclays. Il Cavaliere, as Berlusconi is known, must pass key pro-growth structural reforms, which he promised to Merkel, Sarkozy, and the ECB, to continue to receive support. The ECB, now under Mario Draghi’s control, has been instrumental in buying Italian debt and maintaining some sort of market confidence.
“The outcome of an emergency cabinet meeting held [Wednesday] night suggests that the Italian government will be unable to approve unpopular measures needed to restore market confidence in the very near term. In fact, among the hypotheses circulated yesterday (i.e., a one-off charge on domestic deposits, the re-introduction of a property tax, further increases in the VAT rate, pension and labour market reforms), none seems likely to be tabled today at the G20 meeting in Cannes.”
Il Cavaliere’s failure to pass key reforms would push opposition members, with the Democratic Party’s (PD) Pierluigi Bersani at the helm, to call for Berlusconi’s resignation, which reportedly President Giorgio Napolitano will approve. Napolitano will then call for the formation of a “technocratic government”, which, historically, “has been able to pass pro-growth structural reforms, including politically difficult labor reform.” This, in turn, would provide incentives for the ECB to support Italian debt further and could possibly help Italy decouple from other peripherals.
As reported earlier today, contagion risks are huge. BNP Paribas holds €22 billion in peripheral debt, €12 billion of that in Italian bonds. MF Global recently went bust on its exposure to Europe and large Wall Street banks like Goldman Sachs, Morgan Stanley, Citi, and JPMorgan Chase, have seen their stock prices tank on every turn of the market.
The stakes are higher than ever. The global market is now hostage to Greece’s and Italy’s political systems. The odds of success appear to be decreasing by the hour.
Greece drops referendum plan
Athens, Nov. 3: After a tumultuous day of political gamesmanship, Prime Minister George Papandreou called off his plan to hold a referendum on Greece’s new loan deal with the EU, withdrew his previous offers to resign and opened talks on a unity government with his conservative opponents.
In an address to his party’s central committee this evening, he said there was no need for a referendum now that the Opposition New Democracy party had said it would back the debt deal. He invited that party to become “co-negotiators” on the new deal.
“The question was never about the referendum but about whether or not we are prepared to approve the decisions on October 26,” he said, referring to the EU debt deal. “What is at stake is our position in the EU.”
Shortly afterwards, the finance minister, Evangelos Venizelos, confirmed the cancellation of the referendum and added that the government will now seek approval of the loan deal from a full majority of 180 in Parliament, rather than the simple majority of 151 that has supported previous measures.
The developments re-established a tentative stability in Greece that still could be dashed in a stroke. Papandreou must sweat out a vote of confidence tomorrow whose outcome is far from assured. If he survives that, he and the Opposition leader, Antonis Samaras, will have to negotiate their conflicting visions for the future. Samaras would like to see a transitional government of technocrats leading to early elections, perhaps in two months, while the Prime Minister prefers a coalition government that would rule for at least six months.
The decision to drop the referendum came after Samaras switched course and decided to back the loan deal which would involve a 50 per cent write-down of Greece’s debt. Earlier, Samaras had been content to sit on the sidelines and scoring political points by opposing the deal and previous bailouts.
Speculation had been rife all day today that Papandreou would abandon the referendum plan if the Opposition would back the European deal. Before going into a brief emergency cabinet meeting, Papandreou suggested that he was prepared to walk away from the referendum proposal, saying that it “would not have been necessary if there had been consensus with the Opposition”.
At first, Papandreou was said to have offered to resign before a confidence vote scheduled for tomorrow. By late afternoon, however, Greek news media reported during the cabinet meeting that he not only was refusing to resign but was in fact calling off the referendum plan. He only did so later in the day.
Papandreou had said the referendum was aimed at broadening consensus, which meant forcing the Opposition to back the loan deal. Analysts said that he may have been happy to drop the idea once that goal was accomplished today. After the cabinet meeting ended, Papandreou spoke with Samaras by phone.
Even if he survives the coming hours or days in office, the Prime Minister is widely seen as having expended nearly all his political capital. Ever since Greece asked for a bailout from the EU in April 2010, he has struggled to satisfy seemingly irreconcilable constituencies: the Greek electorate and Greece’s foreign lenders, who have insisted on tough austerity measures in exchange for aid, pushing Greek democracy to the breaking point.
Papandreou had stood by his referendum plan when he met European leaders in Cannes, France, yesterday, where they were gathering for the Group of 20 summit.
The referendum announcement on Monday angered European leaders and threw the entire debt deal into chaos, causing turbulence in world markets.
Divisions within Papandreou’s government flared into the open today when the finance minister, Evangelos Venizelos, and his deputy broke ranks with the Prime Minister to oppose a referendum, saying it could jeopardise Greek membership in the single currency euro zone.
Faced with the growing insurrection among his own ministers, who only a day earlier appeared to have rallied around the referendum plan, Papandreou called the urgent cabinet meeting this afternoon.
French President Nicolas Sarkozy said European leaders cannot accept the “explosion” of the euro and cautiously welcomed Greece’s decision to scrap a referendum on a hard-fought European bailout plan.
Sarkozy said European leaders will meet again to try to work out ways to stem Europe’s debt crisis. Speaking in Cannes today, Sarkozy said: “We cannot accept the explosion of the euro, which would mean the explosion of Europe.”
Does this whole scenerio sound familiar? Problem-Reaction-Solution, alot like what the Freemasons do?
Greeks Need Guts!Greeks Need Guts!
Lets tell the people the big picture! From my Greek friend
November 4, 2011 Friday
Greece has natural sources such as gas, oil, gold so it should not be poor if managed right.
Other European countries and USA didnt want Greece to become a strong power in the region, so they were not developed.
Part of Greece in aegean sea, the gas comes out of the bottom of the sea on its own and vanishes to the air.
What a waste! Harness that and pay your debt.
Turkey threatens it will consider it an act of war if Greece seeks to benefit from the sources in the Aegean sea, so Greek govt needs guts!
Put Turkey in their place, dont cower!
TURKEY, greatest mideast threat, bully, 3 pages
Greece expelled from EU if bailout rejected
France warned that if Greece does not accept the the EU financial bailout plan, they will be expelled from the union.
Greek PM Papandreou faced a confidence vote after retracting his plans for a referendum.
Investors fear that rejection of the hard-fought debt relief plan would force a disorderly Greek default.
Greece leave the euro if Greeks reject the euro.
Prime Minister George Papandreou has said that rejection of the bailout would mean an exit from the eurozone.
27 members in European Union.
French leader Nicolas Sarkozy told Greeks: "Abide by the eurozone rules or leave."
With Greece unable to devalue its currency, the country is hobbled with crippling debt payments it can't afford.
Many economists (and Greek people taking to violent protests) think leaving the euro is the best way to get out of this mess.
If Greece were exit eurozone it would introduce a new currency, a drachma.
The new currency would fall through the floor and inflation would go through the roof.
It would be a legal minefield. Living standards would be hit hard.
Greek PM wins confidence vote, vows unity government
November 5, 2011 Saturday
Greek Prime Minister George Papandreou won a nail-biting confidence vote in parliament early Saturday after vowing to start talks to form a government of national unity in the crisis-hit country.
Papandreou carried the vote, watched nervously by financial markets and fellow European leaders, despite a razor-thin majority for his socialist party and a rebellion within the ranks.
A total of 153 deputies among 298 present approved the motion, the parliament speaker said to sustained applause within the chamber.
The result hung in the balance amid unbearable tension as each MP voted in favour or against the motion, with the "yes" and "no" camp neck-and-neck right to the end.
The vote makes it more likely Greece will be able to implement the terms of a massive EU bailout designed to keep the near-bankrupt country afloat and is likely to be cheered across Europe.
Calling for a broad coalition to put into action the EU package, the hard-pressed premier told parliament he was open to a government of national unity.
Shortly before lawmakers began voting, Papandreou had announced he would see the Greek president later on Saturday to hand in his mandate and start talks on the formation of such a government.
"Honest and broad backing is called for," he told deputies ahead of the vote. "The changes that need to take place are historic and require citizens' participation."
He dismissed opposition calls for an early election, saying such a vote would be a "catastrophe".
And it was not clear whether he would be the person to lead the coalition government when it is formed.
But, in a clear hint that he might step aside, he said he would not put personal considerations before saving the country.
"I am not interested in a chair, the last thing I am interested in is whether I am re-elected.
"If by my deeds I can give a message that we are not enemies ... then I will have made the greatest contribution to the country in my 30-year career," he said.
"The tradition of my family would not permit me to do anything different," said Papandreou, whose father and grandfather were also leaders of Greece.
As the debate took place, several thousand communists staged noisy protest in front of the flood-lit building.
Chanting, banging drums and waving red and Greek flags, the protestors overflowed the central Syntagma Square under the watchful eye of several hundred police officers carrying riot gear.
In a poignant expression of the hardships ordinary Greeks are suffering, one little girl, high on her father's shoulders, carried a sign which read:
"My grandma needs care, my mother wants a job and I want schoolbooks."
The vote capped a tumultuous week for Greece that began with Papandreou's disastrous call to hold a referendum on the 100-billion-euro ($138-billion) EU bailout package that sparked revolt in his own party and roiled markets.
Analysts had warned that renewed political uncertainty could halt the disbursement of a new 8-billion-euro loan package that Greece needs by December 15 to pay the bills.
Finance Minister Evangelos Venizelos said that early elections could be held once negotiations on the EU bailout package are complete.
Papandreou's call for a referendum earned him a humiliating dressing-down this week from European leaders, who warned it could derail the rescue package and even raised questions about Greece's continued EU membership.
On the street, people appeared to be in favour of a government of national unity. One pensioner who gave his name as Takis told AFP: "As matters stand, nothing can save us.
"There must be a government of national salvation with all the parties until we have elections. They way things are now George (Papandreou) cannot continue."
On Syntagma Square, where violent demonstrations have taken place during the crisis, Sofia Papadimitriou, a 25-year-old student said: "Papandreou must go."
"He's had it. He can't get anything done. He hasn't got any energy left."
The Ta Nea daily said the country was "on the edge of a cliff" and Eleftheros Typos rounded on Papandreou, saying he was "destroying Greece."
For the first time, German Chancellor Angela Merkel and others raised the spectre of Greece leaving the euro, hiking the pressure on the politicians in Athens to strike a deal if they wanted to remain in the bloc.
Bemoaning the fact that "Greece is once again in the world media spotlight for all the wrong reasons," the Athens News said the country was in a state of "confusion and inconsistency."
Vangelis Ipadimou, a worker studying the headlines at one of the several newspaper kiosks in central Athens, said he wanted power removed from politicians.
"We should give the responsibility to technocrats, not to politicians any more," he said.
|The new European deal, agreed on Oct. 27 after marathon negotiations, would give Greece a euro130 billion ($179 billion) rescue package. It would also see banks write off 50 percent of the money Greece owes them, about euro100 billion ($138 billion). The goal is to reduce Greece's debts to the point where the country is able to handle its finances without relying on constant bailouts.
To receive funds from the initial bailout, Greece was forced to embark on a punishing program of tax hikes and cuts in pensions and salaries that sent Papandreou's popularity plummeting and his majority in parliament whittled down from a comfortable 10 seats to just two.
Yes, the purpose of this "bailout" is to DESTROY Greece's economy!
Moody’s cuts Cyprus’ credit grade by 2 notches to Baa3 over banks’ exposure to Greece
November 5, 2011 Saturday Nicosia
International ratings agency Moody’s cut Cyprus’ credit grade by two notches to Baa3, or just above junk status,
and warned of further downgrades because its banks will likely need state support next year over their heavy exposure to Greek debt.
Moody’s said in a statement that Cypriot banks’ losses have more than doubled under last month’s new European debt deal for Greece that would see banks write off 50% of the money the country owes them.
Those higher losses make it more likely that the government would need to step in and provide a financial backstop of around €1 billion ($1.38 billion),
raising the government debt-to-gross domestic product ratio by 5-10 percentage points.
Cyprus’ top 3 banks hold an estimated €5 billion ($6.89 billion) in Greek government bonds.
Cypriot Finance Minister Kikis Kazamias said the island’s debt currently stands at around 65.5% of GDP.
Moody’s also cited the Cypriot government’s inability to borrow from international markets which raises the possibility that
authorities will need to seek emergency funding from official sources like Europe’s bailout fund, or European Financial Stability Facility.
Rising interest rates on Cypriot bonds have made it increasingly difficult for the government to borrow from the secondary markets in order to finance the island’s debt and cover costs.
Greece begins talks on emergency govt
5 November 2011, (AFP)
Greece on Saturday was to begin talks on forming an emergency government to drag itself out of political stalemate caused by two years of austerity after Prime Minister George Papandreou won a nail-biting confidence vote.
He said the new government would be in power "until the end of February" when details on the EU bailout package are expected to be completed "so they can be submitted to the electoral inspection of the Greek people."
Greece is NWO Test Ground
This is on page 1 of this thread. The NWO plan is to destroy Greece and bring down all world economies. SOON.
Greek PM Launches Coalition Effort
November 05, 2011
Greece prime minister survives confidence vote, may step aside
New 4-month cross-party government could safeguard a European debt pact
You Can’t Spell Tooth Faeries Without EFSF5 November 2011, by Peter Tchir of TF Market (Zero Hedge)
Well, actually you can, but I guess that is my point. We have been reacting so much to headlines there has been no focus on details.
Even the political farce in Greece drew attention away from the real problems.
Lost in the shuffle this week is the fact that there still is no IIF plan.
No definition of what an NPV haircut is, or how much EFSF support is going to the banks as part of this “haircut” and which prong of EFSF money this will come from.
Merkozy can complain about Papandreou backing out of “the plan” but honestly, don’t you think he should have been given a plan?
A vague promise by bankers of a 50% NPV haircut so that Greece can achieve 120% debt to GDP in 9 years, doesn’t sound that great.
I don’t believe Greece was on board with any plan, and probably haven’t even seen what it will look like.
Once the IIF comes up with their plan, I suspect some people will be disappointed – Greeks and the taxpayers of countries that see more money going to banks, rank right up there as candidates to be disappointed.
What I have finally seen, is some actual discussion of what default would mean. For all the talk about “Greek Default” very little serious work has been done on it.
The instant reaction is “horrible for Greece”, “stone ages”, “togas and sandals”, “hyperinflation”, etc., yet as some analysis starts to come out,
more and more is showing that Greece could have a much better debt burden while retaining core state assets if they head down the path of default or repudiation.
After the initial nasty comments that came out of European leaders forced Greece back on the “path”, more reasoned voices are coming out – slowly, but at least starting to come out.
If Greece defaults, would they even have to give up the Euro?
Important leaders have said they would, yet there is no mechanism to force them, and would be a great way for Greece to wipe out its debt and not experience hyperinflation.
If Greece left the Euro, could it remain in the EU?
There are 17 countries that use the Euro, but 27 in the EU, so it would seem possible that they could leave the Euro but remain in the EU. That too is only starting to be discussed.
The initial headlines were all about – don’t pay and get kicked out and starve, but the reality is likely much different and probably much better for Greece.
The EU leaders may be able to stop this line of thinking, but as people get over the initial “shock and awe” of the word “default” they are realizing it is not the end of the world for Greece and may in fact be the fresh beginning they need – Argentina and Russia might be better examples than Zimbabwe.
I am not sure what exactly has happened to the Greek government. So far, it is being interpreted as positive because they will go along with the plan.
I guess that is the case, but I find it hard to believe that the people will be pleased that the referendum was taken away.
I think as they also start seeing proper and reasoned arguments against accepting the terms being forced on them, the level of dissent will grow.
There were no tanks rolling into town squares to send the people back to their homes in fear, but enough has potentially been done to turn the tide of the people against the politicians.
I don’t think we have seen the end of dissent in Greece, and if anything, I would expect it to become more vocal, and supported by more facts about what Greece could do, rather than just fear mongering of default and fewer summit invitations.
Greek premier struggles to end political deadlock
November 5, 2011 ATHENS, Greece (AP)
Greece's prime minister struggled Saturday to form a temporary coalition government in the near-bankrupt country, extending a political deadlock threatening billions in international rescue funds.
In an impassioned plea to parliament late Friday, George Papandreou agreed to step aside as premier if necessary to help hammer out a coalition,
offering to include the conservative opposition party — a possibility swiftly rejected by its leader.
Papandreou said a new coalition government would need four months to secure the new €130 billion ($179 billion) rescue agreement and demonstrate the country's commitment to remaining in the eurozone.
"Cooperation is necessary to guarantee — for Greece and for our partners — that we can honor our commitments," Papandreou said at a meeting Saturday with President Karolos Papoulias, hours after his Socialist government narrowly survived a confidence vote.
"I am concerned that a lack of cooperation could trouble how our partners see our will and desire to remain in the central core of the European Union and the euro."
But Papandreou's plea was snubbed by conservative opposition leader Antonis Samaras.
"We have not asked for any place in his government. All we want is for Mr. Papandreou to resign, because he has become dangerous for the country," Samaras said in a televised address. "We insist on immediate elections."
Samaras was due to meet the president at 1:00 p.m. (1100GMT) Sunday.
Frustrated with Greece's protracted political disagreements, the country's creditors have threatened to withhold the next critical €8 billion ($11 billion) loan installment until the new debt deal is formally approved in Greece.
Greece is surviving on a €110 billion ($150 billion) rescue-loan program from eurozone partners and the International Monetary Fund. It is currently finalizing a second major deal: to receive an additional €130 billion ($179 billion) in rescue loans and bank support, with banks agreeing to cancel 50 percent of their Greek debt.
Midway through his four-year term, Papandreou was forced by his austerity-weary Socialist party into seeking cross-party support after he abandoned a disastrous proposal to hold a referendum on a new European debt deal — which prompted havoc on world markets and anger from creditors.
Papandreou's popularity has been battered by two years of punishing austerity, causing crippling strikes, violent protests and sharp
drop in living standards for ordinary Greeks who face repeated rounds of tax hikes and cuts in pension and salaries.
Late Friday, Papandreou won a confidence vote in the Socialist-led parliament on a pledge that he was willing to quit and form a caretaker coalition.
But he insisted an immediate election would paralyze government and endanger the new rescue deal.
The conservative snub left Papandreou with limited options: negotiating with conservative splinter groups and independents to attract consensus, and possibly invite respected non-politicians to join the effort.
"(Papandreou) will not resign immediately and he cannot resign before there is a new government. What remains to be seen is how flexible he will be in seeking a different governmental makeup," Ilias Nicolacopoulos, a prominent political analyst told AP television.
"There will be a tough game of poker."
Opposition demands PM quit
November 6, 2011 Sunday
Antonis Samaras, the snaky looking Greece opposition chief demands PM quit over the debt crisis.
Samaras has backed the idea of a short-term coalition government to secure parliamentary approval of a new eurozone bail-out package.
However, he does not want a unity government to be headed by Papandreou.
And he has insisted on early elections.
Papandreou will step down if a government of national unity can be formed, but warns early elections would have
catastrophic consequences for the economy and for the Greek people. Greeks prefer a national unity government.
My personal contacts in other nations say ....
In other euro nations everybody is nervous about the situation with Greece. Its a very serious problem.
The institutional impact of its collapse is huge. The leaders dont want to acknowledge any chance for a member to leave the eurozone.
Its about the power and relevance of the monetary union. If anybody can leave or thrown out, then it would mean the power of the currency is limited.
Greece is a NWO Test Ground
The purpose of euro bailout is to DESTROY Greece economy!
The bailouts and stimulus destroyed the American economy.
Greek Coalition Government Deal Agreed
November 6, 2011
A deal on a new coalition government in Greece has been reached - but current prime minister George Papandreou will not be at the helm.
The draft agreement between Mr Papandreou and the country's opposition leader, Antonis Samaras, came after a day of speculation that the PM would resign.
The two sides said they would take the country to an election after the implementation of the bailout deal and would meet on Monday to work out the details of the new caretaker government.
Samaras had earlier insisted the PM must go to save the economy and said he was willing to help in the formation of a coalition government - but not until Mr Papandreou had stepped down.
Despite winning a confidence vote in parliament, Mr Papandreou has struggled to form a temporary coalition government to back the controversial EU bailout package.
The prime minister had gone into talks with president Karolos Papoulias on how to construct an administration to negotiate the deal to write down Greek debt and release billions in emergency aid.
The country is under pressure from the eurozone's power brokers to implement the bailout package agreed in Brussels on October 27.
If the bailout stalls in the Greek parliament, that would hamper the release of money Greece needs to pay salaries, pensions and international creditors.
After the prime minister won a confidence vote in the early hours of Saturday morning, European finance ministers, who meet next week, will want to see progress in Athens.
However the opposition New Democracy party is angry Mr Papandreou decided to tough out his tenure, rather than call snap elections.
Greece's shadow finance minister Notis Mitatarakis believes the leader of the country's new interim government did not have to be a politician.
"We need elections because we need a stable government to be able to negotiate the new loan agreement," he said.
"However, we realise the need for an interim government in order to conclude the loan agreement [and] the restructuring of the Greek debt.
"That would need a person that is mutually accepted, not necessarily a politician - rather, not a politician - to run an interim government and then go to elections."
The wrangling comes after almost a week of market anxiety over whether the near-bankrupt country will actually embrace the bailout deal.
Mr Papandreou has already abandoned a proposal to hold a referendum on the package, which would result in years of financial austerity for Greece.
On Friday world leaders drew a blank in their efforts to resolve the wider eurozone crisis, as a G20 summit ended with no agreement on crucial measures to shore up ailing economies.
The Group of 20 leading economies failed to thrash out a detailed plan to stabilise the single currency or to boost the International Monetary Fund's ability to respond to emergencies.
Prime Minister David Cameron warned squabbling eurozone leaders "the world can't wait" for them to finalise plans to bailout Greece, recapitalise banks and erect a one trillion euro (£870bn) firewall to protect the single currency.
He acknowledged that the ongoing uncertainty in the eurozone was having a "chilling" effect on the British economy.
TUI prepares Greek hoteliers for euro zone exit
6 November 2011, Frankfurt (Reuters)
German tour operator TUI AG (TUIGn.DE) has asked Greek hoteliers to sign new contracts spelling out
how it will pay its bills in the event Greece leaves the euro zone and starts using a new currency.
"As a responsible company, we should protect ourselves for a potential exit of Greece from the euro zone," said Robin Zimmermann, adding TUI's Nordic unit had sent a letter to the hoteliers.
He was confirming a report in German newspaper Bild, which quoted the letter as saying: "If the euro should no longer be the currency (...),
TUI is entitled to pay the sum of money in the new currency. The exchange rate shall be made at the exchange rate set by the government."
Tourism is key for Greece’s €230 billion (£197.9 billion) economy and accounts for about 1/5 of GDP.
More than 2 million Germans travelled to Greece last year, making them the biggest group of visitors there..
The President of the Greek Tourist Board, Andreas Andreadis, told Bild that several Greek hoteliers had received the letter from TUI, the owner of London-listed TUI Travel (TT.L), and were asked to sign it.
"No hotelier will do that and we turned to the Greek Ministry of Tourism. TUI can not put pressure on hoteliers to sign such a thing," he was quoted as saying.
Morgan Stanley Says Europe’s Pandora’s Box Has Been Opened
6 November 2011 Zero Hedge
And what is even more disturbing is that Germany itself is now demanding a referendum. According to Welt, 71% of Germans want a referendum, and want to to vote directly on important decisions for Europe and the Euro.
Only 27% oppose the motion.
And the same poll has found that 63% of Germans think Greece should be kicked out of the Euro, with just 32% believing the country can still be saved.
GREECE is a MESS!
November 7, 2011 Monday
The new PM of Greece is Mpakodimos, the former vice president of the european central bank.
Some Greeks truly WANT Greece to LEAVE the EU and return to their own currency.
That is what other nations fear.
Greece coalition unity government to lead until 19 February 2012 elections.
The elections to be held once the government has approved an EU bailout package.
(That sounds wrong to me.)
The EU says no more funds will be released to Greece until the new bailout deal has been approved.
Greece prime minister Papandreou and Antonis Samaras, his main opposition form an interim government.
Papandreou will step down halfway through his 4 year term.
He and Samaras will decide who will be PM and the makeup of the Cabinet.
Papandreou had been trying to build a national unity government, but Samaras refused to negotiate unless his rival resigned first.
The two men also disagreed on the timing of elections.
Should we feel sorry for Greece?
How might Greece leave the euro?
Greece to get another 8 bln euros in bailout)
7 November 2011 MarketWatch
Greece will reportedly receive 8 billion euro ($11 billion) in the six tranche of its first bailout package and will begin working on the new rescue deal if the troubled country's leaders can commit to the terms.
Without the payment, which has been delayed for two months, Greece would potentially default in December.
Meanwhile, eurozone ministers, in an effort to bolster emergency funds, are working to raise the 440 billion euro European Financial Stability Facility to 1 trillion euro
by seeking outside investors and insuring bonds from the more unstable countries in the eurozone, like Italy and Spain.
Greece ends deal with advisor banks
6 November 2011, by Chris Oliver - Hong Kong (MarketWatch)
Greek news media reported Sunday that Athens has terminated agreements with Deutsche Bank, BNP Paribas, and HSBC -- the three banks hired to advise on the private-sector writedown of Greek debt as part of the debt deal agreed July 21 at the European Union summit.
The contracts were terminated late last week and involve the coordinators of the "Private Sector Involvement" agreement, the centerpiece of the second bail-out package valued at $109 billion, the Athens News reported Sunday.
It wasn't clear whether the Greek government would hire new advisors or negotiate directly on the PSI agreement reached last month, in which private creditors accepted a 50% haircut on their holdings of Greek sovereign bonds, the report said.
The three advising bank, had reportedly completed significant legal and technical work on the writedowns and were to be paid 70 million euros ($96.4 million) for their work.
I see the world rapidly going into the Revelation 13 beast system (antichrist) .. and all television as BeastTV
Beware BeastTV - All the sheepl are told is what the Beast wants us to know.
A Chinese man was asked about China bailing out Europe. He said,
If you look at the troubles which happened in European countries, this is purely because of the accumulated troubles of the worn out welfare society.
I think the labour laws are outdated. The labour laws induce sloth, indolence, rather than hardworking.
How might Greece leave the euro?
8 November 2011 from my Greek friend
Loukas Papademos, former Vice president of the European Central bank was named New Greek PM but he declined the no-win job.
Papademos does not accept position. He wants to appoint his own ministers.
Lucas Papademos is a Greek economist. He worked as an assistant research scientist and an expert at MIT.
In 1980 he worked as an economic expert to the Federal Reserve of US.
In 1985 he returned to Greece by undertaking economic adviser to the Bank of Greece.
In 1993 he was appointed Deputy Governor of the Bank of Greece and the next time governor of the Bank remained until 2002.
He took over Vice European Central Bank position which he left in 2010.
He was an unpaid economic adviser to Prime Minister George Papandreou.
Papandreou-Samaras talks on new Greek government
Prime Minister George Papandreou will not be part of the next Greek government.
Greek politicians are under international pressure to resolve their differences
Greece's political leaders are still locked in debate over the formation of a unity government they hope can save the country from imminent bankruptcy.
Power-sharing talks in Greece drag on
November 8, 2011 Tuesday ATHENS, Greece
Power-sharing talks between Greece's prime minister and the opposition leader dragged on into Tuesday evening,
with senior government officials saying a deal was close and European leaders ratcheting up the pressure for a resolution.
Talks between Prime Minister George Papandreou and opposition leader Antonis Samaras began Monday. The two agreed over the weekend to forge an interim government that will shepherd the country's new euro130 billion ($179 billion) European rescue package through Parliament and end an intense political crisis that threatened Greece's solvency and membership of the euro.
Without the Oct. 27 deal, which took European leaders months to work out, Greece would go bankrupt, potentially wrecking Europe's banking system and sending the global economy back into recession.
"I believe that we are now close to an agreement with New Democracy," Papandreou said during a Cabinet meeting, referring to Samaras' conservative party.
When one cooperates with another party, there are some red lines on either side which of course restrict things," he said in comments released by his office. "Therefore, while one could imagine ideal situations, in reality these do not exist, and one seeks simply to find the best possible solution."
Senior government officials promised a deal would come by the end of Tuesday, with one government official saying a former vice president of the European Central Bank, Lucas Papademos, was the most likely candidate to replace Papandreou as premier. He spoke on condition of anonymity because no names had officially been made public.
The official said the delay on a public announcement of a deal was mainly due to objections from the opposition party over demands from European officials for written committments by both parties that they supported the new debt deal.
On Monday, eurozone finance ministers said the heads of the two main parties had to commit in writing to the terms of the country's bailouts before Athens can receive a vital euro8 billion ($11 billion) loan installment without which the country faces default within weeks.
"It is indeed essential that a new government will express its explicit and unequivocal commitment in writing concerning all the decisions taken by the 17 euro area member states on Oct. 27," EU economic affairs commissioner Olli Rehn said in Brussels Tuesday.
The next rescue loan installment "can then be disbursed once there is full clarity about Greece sticking to the agreed course and policies," Rehn said. "It should be clear in Athens that solidarity is a two-way street and we expect a united political class to carry out its part of responsibilities."
Samaras, however, appeared to take offense.
"There is national dignity," he said in a statement issued shortly before Rehn's comments. "I have long and repeatedly explained why, in order to protect the Greek economy and the euro, the implementation of the (new European debt deal) has become 'inevitable'. I do not allow anyone to cast doubt on these statements."
His party's spokesman, Yiannis Michelakis, was even blunter, issuing a direct response to Rehn's comments.
"The fact that Europe has lost any trace of trust in the (Socialist) government, does not mean it can insult our national dignity," he said.
Another senior Greek government official said Tuesday that Greece's eurozone partners demanded more — that Papandreou and Samaras, the Bank of Greece governor, the new prime minister and the new finance minister all co-sign a letter reaffirming their commitment to the country's bailout deals and economic reforms.
During an earlier Cabinet meeting, Socialist ministers offered their resignations to Papandreou to pave the way for the creation of the interim government, which is to last until an early election expected Feb. 19.
"We have made our resignation available to the prime minister in order to help him with his actions," Tourism Minister George Nikitiadis said. "My feeling is that tonight we will have a name (of the new premier). It's going well."
The political crisis erupted last week, when Papandreou said he would put the new European rescue package to a referendum. Other eurozone nations were horrified by the delay, markets around the world tanked and Greece's international creditors froze the payment of the next bailout.
Papandreou withdrew the plan Thursday after Samaras indicated he would back the new deal. They then reached a landmark agreement Sunday for Papandreou to step down and the temporary government to be formed.
Greece has survived since May 2010 on a euro110 billion ($150 billion) rescue-loan program from its eurozone partners and the International Monetary Fund, but all agree it's not enough. A second rescue package has been created that involves private bondholders voluntarily agreeing to cancel 50 percent of their Greek debt.
In return for its bailout cash, Greece has endured 20 months of punishing austerity measures. The efforts by Papandreou's government to keep the country solvent have prompted violent protests, crippling strikes and a sharp decline in living standards for most Greeks.
Its still a mess.
USA and FOREIGN MARKETS DOWN November 9, 2011
Italian government borrowing costs soar to new highs, with yields on 10-year bonds hitting 6.86%
New Greek government to be unveiled, but negotiations far from over.
Greek political leaders will announce a new coalition government on Wednesday, though there is no indication of a deal on a new prime minister to lead the country back from the brink of bankruptcy.
The socialist and conservative parties wanted Papademos, Greek media mentioned parliamentary speaker Filippos Petsalnikos and socialist lawmaker Apostolos Kaklamanis for premier, but both have denied the reports.
Greece must have a new coalition to secure the bailout to safeguard its place in the euro zone.
The EU needs to put out the fire in Greece to prove they can tackle the fire in Italy.
Greek Bank Deposits Plunge By €5.5 Billion In September: Biggest Monthly Drop Ever8 November 2011, by Tyler Durden (Zero Hedge)
Where Does The Greek Bailout Money Go?
8 November 2011, by Tyler Durden (Zero Hedge)
Lucas Papademos new Greek prime minister
November 10, 2011 Thursday
Greek party leaders have FINALLY agreed on Lucas Papademos, a former vice-president of the European
Central Bank, to head a new interim government until early elections are called some time next year.
The office of Greek President Carolos Papoulias said on Thursday that after talks with party leaders,
the president had "given Mr. Papademos the mandate to form a government."
Lucas Papademos is highly regarded internationally for his banking expertise.
His appointment was held up for 4 days as Greek party leaders squabbled over his demands.
One man in the New Greek Cabinet hates Israel, Jews
November 11, 2011 Friday - 11.11.11 Friday
Greece is due to name new cabinet today, Friday.
Lucas Papademos determined who would staff his cabinet.
When he chose a Jew-hater he cursed Greece. I didnt think he'd be good, just my feeling.
Jews in Germany are shocked that Greece has put Georgios Karatzaferis into their new government. Karatzaferis has compared IDF to Hitler
Karatzaferis made a long line of anti-Semitic and anti-Israeli statements.
New interim government will push through a new European debt deal and secure continued bailout funding to prevent a catastrophic default.
New Eurozone govt forsees collapse of euro
New Europe, the Rise of the Fourth Reich
New Eurozone govt forsees collapse of euro
New Europe, the Rise of the Fourth Reich
Europe's real problem: Lack of growth
November 14, 2011 Monday
The mood in Germany is pretty grim. Europe is facing its most severe challenge since 1945. The entire structure of Europe could unravel.
European leaders will not address Europe's core problem, a lack of growth.
Germans are trying to find some solution to this crisis that will not let countries like Greece and Italy off the hook.
The real problem Greece budget numbers look bleak is because its growth forecast looks bleak.
What can the Greek economy do to attract capital and investment? And at what wage levels?
Italy economy has not grown for 10 years.
German growth in only 1.5%.
Greek conservative hard stance threatens bailout
14 November 2011
Samaras, Greece's conservative party leader vowed to reject any toughening of austerity measures in return for a multi-billion euro bailout,
signaling the new coalition government may not enjoy the kind of cross-party support demanded by lenders.
New Democracy leader Antonis Samaras said he would not vote for any new austerity measures and added that the policy mix of
spending cuts and tax rises agreed with international lenders should be changed in favor of economic growth.
"I agree with the goals to cut government spending to reduce debt, to erase the deficit, to make structural changes.
I do not agree with whatever stunts growth," he told party MPs ahead of a 3-day confidence debate, starting on Monday.
Although Samaras' party are part of the new administration of former ECB vice president Lucas Papademos,
its support for the 3-day old government has so far been lukewarm and his backing is crucial for passing legislation needed to satisfy international lenders' demands.
Samaras said he would not sign any letter pledging support for conditions on a 130 billion euro bailout as EU Economic and Monetary Affairs Commissioner Olli Rehn has demanded.
"I don't sign such statements," he said, adding that his word should be sufficient.
His refusal to sign could imperil an 8 billion euro loan Greece needs by mid-December to avoid default.
Nations mull Greek exit from euro
Ever since the idea of the euro currency really took off in the late 1980s, it has been accepted wisdom that entry was forever.
But now, with no less than the leaders of France and Germany conceding that Greece could leave the euro, everyone is scrambling to figure out exactly what would happen.
The stakes couldn't be higher: many economists say it could plunge the global economy into another crisis on the scale of what ensued following the collapse of U.S. investment bank Lehman Brothers in 2008. Others say it would spell the beginning of the end of the dream of building a unified Europe from the ashes of World War II.
Yet some are saying it's the least bad of all possible outcomes, part of the only remedy available for a currency, launched in 1999, whose design flaws have led to three countries requiring rescue.
The crisis is now threatening Italy — the eurozone's third-biggest economy — and is showing alarming signs of infecting France — its second-biggest.
If Greece decides to go back to the drachma following what would likely be a disorderly default, there would likely be a run on banks as depositors uncertain of the value of the new currency yank out their euros — that is if they are still given a chance. With deposits potentially running dry, banks would stop lending to one another and fail as they lost access to cash needed for their daily operations. Without capital, businesses would collapse and consumers would stockpile goods.
And that's just in Greece.
Investors would immediately begin speculating on which euro country would be next to fall, leading to the same kind of chaos across the continent.
"This, unfortunately, is the cost of a badly designed monetary union," said Dario Perkins, an economist at Lombard Street Research. "While in the long term, some countries leaving the euro area might be a good thing — for them and the countries that remain — it will surely be some time before those benefits are realized."
Until recently, discussions about a country's exit from the euro had been confined to market commentary and academic papers (British Foreign Secretary William Hague derided the currency as "a burning building with no exits").
Suddenly, top officials are openly discussing the possibility. At a recent summit during discussion of a possible Greek referendum on its rescue deal, French President Nicolas Sarkozy and German Chancellor Angela Merkel said in a statement that "the question is whether Greece remains in the eurozone."
"That is what we want, they said, "but it is up to the Greek people to answer that question."
The referendum has since been canceled. A new Greek government now has seemingly not much more than 100 days to push through a package approving Europe's latest rescue package and another round of punishing austerity, over the objections of many Greeks who have staged months of violent protests.
A growing number of analysts believes those efforts will fail, and that Greece's days in the euro are numbered.
They say Greece would do better to cut and run, avoiding the straitjacket of a decade's worth of austerity.
The current plan would give Greece euro100 billion ($176 billion) more in bailout loans and get the private sector to forgive half of Greece's debt. But even in the best-case scenario it would leave the country saddled with a debt burden of 120 percent of gross domestic product a decade from now — which is the level that's causing Italy so much trouble at the moment.
"Right now they are committing themselves to 10 years of Draconian austerity that won't work," said Peter Morici, a professor at the University of Maryland. "If you want to become the Burma of Europe, this is the way of getting that done."
Morici and other proponents of a euro exit concede that the short-term pain for Greece would be huge, as deposits are converted into much-cheaper drachmas, import prices go through the roof and the financial system faces potential collapse.
But they argue that Greece would eventually be able to re-invent itself through its ability to print its own currency and set an appropriate economic policy for its own needs. Tourism, Greece's number one industry, could reap a massive windfall as it becomes a cheaper place to holiday.
"Letting the value of the drachma fall to levels consistent with a trade surplus that permits Greece to service its debts, Greece's economy would begin growing again, and many of Greece's army of unemployed would be put back to work," Morici said.
Others are highly skeptical that Greece — or anyone else — would benefit from it exiting the euro. A Greek departure would open up a whole new set of uncertainties in the markets: Instead of wondering which country may have difficulty paying its debts, investors would begin to wonder who is next to leave the euro.
If that would mean people converting euros to Italian liras, Portuguese escudos or Spanish pesetas, then depositors around the world may look to get their money out of Europe altogether, a likely shock to the international financial system that could take decades to mend.
Christopher Pissarides, a Nobel Prize-winning economist at the London School of Economics, said the changes in the global financial system over the past few decades mean it would be hard to prevent such a scenario from unfolding.
"It could be the biggest bank run in history," he said.
Greek third-quarter GDP shrinks 5.2% on year16 November 2011, by William L. Watts - Frankfurt (MarketWatch)
Greek third-quarter gross domestic product contracted 5.2% compared to the same period last year, the country's statistical agency said Tuesday.
That follows a 7.4% year-on-year contraction in the second quarter.
The European Commission earlier this month forecast the Greek economy to shrink by 5.5% this year and 2.8% in 2012 after contracting 3.5% in 2010.
Isn't the Yield Curve supposed to be INCREASING?
Greek 1 year bonds: 266%
Greek 2 year bonds: 111%
Greek 10 year bonds: 28%
Greek conservatives reject signing reform pledge
A major conservative party in Greece's new unity government refused Saturday in talks with EU and IMF officials to drop its opposition to signing written reform pledges in return for crucial loans, reports said.
Antonis Samaras, head of the New Democracy party, said its support for the government set up last week specifically to enact reforms tied to a eurozone bailout deal was commitment enough, Mega television reported.
He reportedly made the remarks to senior auditors from the European Commission, the European Central Bank and the International Monetary Fund.
The officials had on Friday also held talks in Athens with Finance Minister Evangelos Venizelos and Prime Minister Lucas Papademos, a former ECB deputy chief parachuted in to lead the new coalition on November 11.
They also met on Saturday with George Papandreou, the former prime minister who leads the socialist Pasok party, the other major party in the unity government.
Poul Thomsen, the IMF deputy director for Europe who is leading the delegation to Athens, declined to comment after the talks.
George Karatzaferis, whose small far-right LAOS party completes the government coalition, is due to meet the officials on Sunday. He has also expressed opposition to a written pledge to Brussels.
Eurozone finance ministers have demanded written commitments from Athens on austerity measures and structural reforms before releasing an instalment of eight billion euros ($11 billion) from a May 2010 bailout deal.
The funds are all that stands between Greece and bankruptcy next month.
A new eurozone lifeline agreed in Brussels last month, slashing the country's 350-billion-euro debt by nearly a third, also hangs in the balance.
The three coalition parties on Wednesday backed Papademos's government in a vote of confidence carried by 255 votes to 38.
Papademos will discuss the deadlock with EU President Herman Van Rompuy and European Commission chief Jose Manuel Barroso in Brussels on Monday, and then with eurozone leader Jean-Claude Juncker in Luxembourg on Tuesday.
The interim government is slated to hold early elections in February, and the winner will be charged with pushing through the rest of the rescue programme. Samaras is currently leading polls to win a four-year term.
As the euro area's sovereign debt and economic crises escalate, a two-front attack looms for banks in weak-link countries.
On one front, international financial intermediaries risk being caught dead — like MF Global — holding an excess of debt from Europe's PIIGS: Portugal, Italy, Ireland, Greece and Spain.
For banks relying on funding from financial markets, their too-hot-to-handle debt has created a liquidity crunch, but one that analysts think may be within the European Central Bank's ability to stem with aggressive action.
The more lethal threat comes from the inside via an old-fashioned run on bank deposits.
Any sign that a country is gearing up to quit the euro would trigger "the mother of all capital flights," said Jacob Kirkegaard, research fellow at the Peterson Institute for International Research.
As fears that Greece will leave the euro have grown, a quiet bank run has proceeded. Deposits held by corporations and households fell 22% from the start of 2010 through September.
Deposit outflow from Greek banks reportedly accelerated in recent weeks, spurred by a threat that Europe would rescind its bailout package if Athens failed to meet austerity demands.
Bank runs are wildfire .. watch this spread
Protest builds against unpopular Greek property tax
Opposition to an unpopular property tax imposed to help secure bankruptcy-saving EU loans gathered pace in Greece on Wednesday ahead of a new general strike called by unions against austerity cuts.
They ignored a prosecutor's order to evacuate the building after receiving support from Greece's main left-wing parties, KKE and Syriza, who are also fighting against a new wave of spending cuts.
"We're not cutting power to the poor even if they throw us in prison," reads a Genop-Dei banner hanging from the building.
Several mayors in working-class Athens districts are also encouraging their residents to contest the tax, which is among measures taken to plug budget shortfalls persisting after two years of tough belt-tightening.
The main unions have called a general strike on December 1, the sixth this year, against an austerity budget that will be pushed through parliament by a new unity government under ex-European Central Bank deputy chief Lucas Papademos, which was installed a fortnight ago.
The property tax was introduced by the previous government in September and would charge residents between 0.5 and 16 euros ($21.6) per square metre, depending on their circumstances.
Portugal's Rating Cut To 'Junk' By China's Dagong
23 November 2011, by Tyler Durden (Zero Hedge)
Arguably the least biased (or perhaps least cognitively dissonant) of the major ratings agencies,
China's Dagong has just moved Portugal's rating to junk (BB+) from comfortably investment grade (BBB+) - a 3 notch drop.
The rating agency also left the peripheral nation on negative watch.
This action follows Monday's Greek downgrade from C to CCC.
Is this a ploy for better entry levels when they save the world with their EFSF-buying bazooka?
Or more likely a more honest reflection of a debt-laden, slow-growing, austerity-facing nation burdened with inadequate leadership and an inability to control its own fate?
Greece may miss 2012 selloff target due to EU crisis
Nov. 26, 2011
Greece may miss its target for privatization revenues next year because of the worsening economic climate in Europe, the head of the agency responsible for selling state assets said in an interview to be published on Sunday.
Greece's repeated failure to meet budget targets including for privatization revenues has angered international lenders, raising questions about whether they will continue indefinitely to keep the country afloat with bailout loans.
Costas Mitropoulos, head of the Hellenic Republic Asset Development Fund, told the Kathimerini newspaper the privatization revenue target of 9.3 billion euros ($12.3 billion) for 2012 was "achievable," based on the draft budget assumptions.
"But reality will show whether these assumptions were right. In order to be able to sell, there should be buyers," he said, noting that even Germany failed this week to sell all its bonds at an auction.
"If this (difficult economic) situation continues, then it is certain that it will be difficult for us to find buyers for our assets."
Greece gets $10.7 billion but rescue plan stalls
BRUSSELS (AP) — Eurozone ministers sent Greece an euro8 billion ($10.7 billion) Christmas rescue package Tuesday to stem an immediate cash crisis yet failed to resolve fears that the common euro currency might be doomed.
Stock markets around the world rose earlier in the day, hoping that intense pressure from the bond markets would finally force the 17-nation eurozone into quicker and more robust action.
But even as Italy's borrowing costs skyrocketed to a euro-era record, the 17 finance ministers only found a veneer of credibility to coat the euro's rescue fund with more leverage. They failed to increase the bailout fund to match earlier predictions and kicked other major financial issues — like a closer fiscal union — over to their bosses, the EU leaders meeting next week in Brussels.
The ministers did agree to use the fund to offer financial protection of 20 to 30 percent to investors who bought new bonds of troubled eurozone nations, an effort to help those countries get back to borrowing on global markets again.
IMF releases 2.2 billion euro in aid for Greece
12/5/11 WASHINGTON (Reuters) - The International Monetary Fund on Monday agreed to release a 2.2 billion euro ($2.95 billion) aid disbursement to Greece,
part of a three-year IMF-EU bailout package to help the debt-stricken country avoid bankruptcy.
"The executive board of the International Monetary Fund today completed the fifth review of Greece's economic performance under a program supported by a three-year Stand-By Arrangement for Greece," the IMF said in a brief statement.
The disbursement brings to 20.3 billion the sum paid out to Greece so far under the 30 billion euro IMF loan agreed in May last year. It is part of a bigger 110 billion euro rescue package for the country.
The approval of the latest aid tranche followed assurances by Prime Minister Lucas Papademos and his new unity government that the country would stick to terms of a debt reduction deal.
Last week, European leaders approved an 8 billion euro tranche for Greece.
An IMF mission will travel to Athens between December 12 and December 16 for preliminary discussions with the new coalition on economic policies.
Bank run in Greece
December 6 2011 Tuesday
Many Greeks are draining their savings accounts because they are out of work, face rising taxes or are afraid the country will be forced to leave the euro zone. By withdrawing money, they are forcing banks to scale back their lending - and are inadvertently making the recession even worse.
Greek lawmakers approve 2012 austerity budget
Greek lawmakers overwhelmingly back 2012 austerity budget in parliamentary vote
Greece's lawmakers overwhelmingly approved next year's austerity budget early Wednesday, extending tough spending cuts that have already left Greeks struggling as the country tries to slash its vast debts and tame a severe recession.
With three parties, including the majority socialists and their rival conservatives, participating in Greece's new coalition government, the budget was passed with a 258-41 majority in the 300-seat Parliament.
"This is a difficult budget ... with ambitious targets," Prime Minister Lucas Papademos told lawmakers just before the after-midnight vote. "But we must achieve our targets and implement the measures that are foreseen."
"The financial crisis in our country is not a passing storm," Papademos warned. "Given the size of the problems, our national effort will not be completed in 2012. It will take many years, and will require the efforts and insistence of several governments."
Greece Financial Crisis Opens Door December 2011
The Greek government fell into chaos when Greece prime minister called for a referendum on a new debt deal.
There was a new agreement that updates the previous agreement that was approved, so that has to be approved by the Greek Parliament again.
Eurozone leaders agreed on a second financial rescue for Greece in return for more unpopular austerity.
The angry Greeks are unlikely to like this, so the PM wants a vote in January.
However, the revolt came from Greek lawmakers who planned a no-confidence vote.
There is a possibility of a government collapse, and Europe is alarmed.
Greece could spark a financial market panic that could hurt other shaky European economies.
Germany and France are very upset because this undermines their efforts to save the euro, and Greeks dont care about the euro.
However, they dont realize the cost. The debt deal was meant to help Greece stay out of bankruptcy.
People are trying to leave Greece to pursue a better future. Thousands of Greeks have filed to immigrate to Australia and other countries.
The middle class started feeling the pressure as the cuts in salaries and heavy taxation increased.
BUT THE SITUATION is the SAME - WORLDWIDE!
PRAY for St. Luke and staff
The facility is under Greek public health system and depends on government payments for its financial well-being.
The Greek government owes the hospital a tremendous amount of money and needs help.
AMG (Christian ministry dealing with hospitals) Christians run St. Luke Hospital in Thessalonica and CosmoVision Center in Athens.
AMG continues to proclaim the gospel and the hope found in Christ. There is definitely a lot more interest in spiritual matters.
People are desperate. And when people get desperate, they tend to do a lot of soul searching, great opportunity to share the gospel.
The mobile medical unit can minister to Muslims in northern Greece.
Greece is a spiritual battleground
We need prayer for our leaders of the ministry, particularly St. Luke.
We need prayer for Greece, that God will work in the hearts of the people and the hearts of the leaders, and that there is a resolution.
Greek Budget Deficit To Pass 10% Of GDP, Country Stops Most Cash Outlays
20 December 2011
While European banks may or may not succeed in delaying the inevitable unwind of the Eurozone by a month or two, the European credit catastrophe is taking on a grotesque form, first in Greece, where following news that the budget deficit will soar past an unprecedented 10% of GDP, the Greek government has halted virtually all cash outflows.
Ekathimerini reports that "The government has decided to stop tax returns and other obligation payments to enterprises, salary workers and pensioners."
In other words, the entire government has now virtually halted one half of its operations - the outlays - as the country reverts even more to its status as European bank debt slave, in perpetuity, or until the country breaks away from the Eurozone and reinstitutes the Drachma (which as Zero Hedge pointed out first in August, continues to trade When Issued at various desks) whichever comes first.
Now, before we forget, there is this one other country that runs 10% deficits of GDP... Oh no, we just forgot who it was... Whoever could it be?
What’s Up in Greece on Dec 20?
My allergy is up against bad news, negative economic figures, missing targets, governmental inaction, social injustice, collective misery and personal dramas.
I wonder how much more I can take and for how long… No matter which side you turn at the pessimism, hopelessness and a difficult daily life is on.
A permanent struggle. So hard. The austerity does not offer a chance even to have a break for Christmas.
Greek Hospitals Turned Away Pregnant Women
Dec. 23, 2011
Pregnant mothers are advised to remain calm at all times, but Elli Zachariadou could not hide her shock a few weeks ago when she heard reports about women having to pay at least €900 up front in order to give birth at public hospitals. Even more shocking to Zachariadou and other Greeks was the news that a number of hospitals had turned away pregnant women because they did not have the necessary cash.
“My immediate thought on hearing about the hospital charges was, how am I going to have this baby?” Zachariadou said. “You know, €900 is about three months’ rent. It’s not the kind of money we have lying around.” In years gone by, the 33-year-old Athenian’s social-security fund would have picked up most of her hospital bill, but she has joined the growing ranks of Greece’s long-term unemployed who have no such coverage.
As their country grapples with its economic problems, accessible and affordable health care is one of many things Greeks like Zachariadou can no longer take for granted. Burdened with a crippling public debt of some €350 billion, Greece’s economy is about to complete a worse-than-expected year. The recession will be deeper and the public deficit larger than the Greek government and its international lenders, the European Union and the International Monetary Fund, had forecast.
The added element to the Greek crisis is that amid this economic maelstrom, the government has to carry out much-delayed structural reforms. One of these is the overhaul of Greece’s health service, where attempts are being made to cut spending and waste. However, this comes at a time when cash-strapped Greeks are relying on free or subsidized medical care in greater numbers. The Health Ministry said earlier this year that the number of patients being treated was up 8 percent this year on 2010. As a result, Zachariadou is one of tens of thousands caught in a fiscal crunch.
Greek tax officials on strike over salary cutsGreek retail sees worst Christmas sales in decades
December 2011 ATHENS (Reuters)
Greece's stores had their worst Christmas in decades, with retail sales dropping by 30 percent compared with the same period last year as the economic crisis shattered consumer confidence, the ESEE retail federation said on Tuesday.
"Nine out of 10 Greeks are less generous, not out of choice but out of necessity," ESEE said. "Retailers endured a Christmas gloom that chipped away any optimism they had before the holidays."
The sharp drop in sales came despite widespread discounts by retailers in the run-up to Christmas.
Greeks have been suffering wage and pension cuts, rising inflation and a recession now into its fourth year, which has slashed living standards and forced them to cut spending.
Clothing and footwear sales dropped 40 percent, electrical goods by 30 percent, and sales in the food and drinks sector by 15 percent compared with the same period
December 29, 2011 ATHENS, Greece (AP)
Greek tax officials walked off the job Thursday at the start of a 48-hour strike to protest salary cuts and other austerity measures, as the government struggles to meet revenue targets demanded by the country's international creditors.
Tax offices shut down for the last two working days of the year, prompting hundreds of Greeks on Wednesday to rush to settle last-minute issues before the strike. Many handed over their car license plates, preferring to keep their vehicles off the road rather than paying an increased tax.
The Athens Chamber of Small Industries said it sent a letter to the country's finance minister, Evangelos Venizelos, urging a change in the higher road tax and arguing it was clear the government would be unable to collect the euro1.2 billion ($1.55 billion) it hoped for from the levy.
The chamber said there had been a 30 percent increase in the number of people turning in their vehicle registration plates compared to previous years. That would lead to decreased road tax revenues and hurt the economy through a fall in the consumption of fuel, vehicle spare parts and spending on car maintenance and insurance, it said.
Greek bond swap deal may soon be reached: official
Greece could soon reach a deal with banks and private creditors on a bond swap to reduce its mountain of debt, as it tries to resolve differences with its creditors and avoid default.
The deal is a pivotal part of a second, 130 billion euro ($168.3 billion) bailout package for Athens agreed by euro zone leaders in October. Greece, which faces bond redemptions of 14.5 billion euros in March, needs to seal the deal to avert a costly default.
"I think there will be an agreement relatively soon. I don't think there will be a problem with this deal," government spokesman Pantelis Kapsis told Real News radio.
"Apart from that, (the issue is) how many (bondholders) will participate, which will be seen at the end of next month or in early February," he said.
Greek economic crisis turns tragic for children abandoned by their families
Nation shocked by stories of parents forced to give up children because of poverty – but charities warn of more cases to come
Even before Greece's economic crisis engulfed his own home, Dimitris Gasparinatos found it hard to provide for his six sons and four daughters. His wife, Christina, who was struggling to make ends meet with his salary of €960 (£800) a month and welfare aid of about €460 every two months, was unhappy and desperate.
Deep in debt, the couple owed money to the butcher, baker and grocer – the very people who had kept them going in the port of Patras, west of Athens. In their tiny flat, the family slipped increasingly into a life of squalor.
"Psychologically we were all in a bit of a mess," said Gasparinatos. "We were sleeping on mattresses on the floor, the rent hadn't been paid for months, something had to be done."
And so, with Christmas approaching, the 42-year-old took the decision to put in an official request for three of his boys and one daughter to be taken into care.
Well good...hopefully these pharmacists can see the evils of pharmakia will they are on hiatus!
Greek pharmacists, doctors on strike
January 2, 2012 ATHENS, Greece (AP)
Greece is already seeing its first strike of the year, with pharmacists and doctors walking off the job to protest health sector reforms that include cuts in drug prices.
Pharmacists across the country began a 48-hour strike Monday to protest government plans to trim their profits by cutting the retail prices of drugs. They are also demanding payment of hundreds of thousands of euros owed by social insurance funds.
State hospital doctors started a four-day strike, objecting to government reforms to the state health system. The doctors were to be present at work but would be treating only emergency cases.
Greece has been surviving on international rescue loans since May 2010. It is negotiating the details of a second bailout.
Sign bailout or face euro exit, Greece warns
3 January 2012 MarketWatch
Greece could be forced to leave the euro if it fails to seal an agreement on a second 130 billion euro ($169.5 billion) bailout from the European Union, International Monetary Fund and private bond holders, a government spokesman warned Tuesday.
"The bailout agreement has to be signed, otherwise we will be out of the markets, out of the euro," the spokesman, Pantelis Kapsis, told Skai TV, according to a BBC report.
The agreement has faced sharp domestic criticism.
European leaders agreed in principle last October on a new bailout plan for the country. EU, IMF and European Central Bank officials are set to arrive in Athens in mid-January to work out details of the plan.
Summary Box: Greece could nix euro without bailout
January 3, 2012
WARNING: A spokesman for the Greek government said it might have to ditch the euro and push more austerity on its people if it can't get a second major international bailout.
PACKAGE ON HOLD: Greece is being kept afloat by a May 2010 bailout. An additional rescue package was set in October, after it became clear the first one wouldn't suffice.
PRIVATE CREDITORS WARY: Banks and insurance funds that hold a lot of Greece's debt agreed then to cut the value of their holdings by 50 percent, which would in effect slash Greece's borrowing. But the talks have snagged on crucial details.
Millions of Greeks living in poverty
January 4, 2012 IRAN media
Millions of people in the cash-strapped Greece are now living in poverty, as a result of the government's harsh austerity measures aimed at ending its financial crisis.
According to the Hellenic Statistical Agency's first official report in 2012, about 20 percent of Greek citizens, which is over two million people, are considered poor.
The monetary poverty line for Greece is set at the annual amount of 7,178 euros per person and 15,073 euros per household with two adults and two dependent children under the age of 14.
The poverty rate for children under 17 years was at 23 percent in 2011, which is three points higher than the poverty rate for the whole population.
This is Iran media - hence, do not trust.
Latest Greek bailout called insufficient; report
6 January 2012, by Tom Fairless - Frankfurt (MarketWatch)
Greece's second bailout package will probably have to be larger than the €130 billion planned, in part because of the country's worsening budget figures, German newspaper Financial Times Deutschland reports Friday, citing people in euro-zone circles.
The agreed amount of new aid won't be sufficient, FTD reports, adding that the exact sum Greece will eventually need depends on ongoing "tough" talks over the participation of private creditors.
The Greek government expects to wrap up talks seeking a 50% write-down on its debt owed to creditor banks by the end of this month, after banks appeared to make concessions on the terms they would accept under a new bailout, people with knowledge of the situation told Dow Jones Newswires Thursday.
On Wednesday, Greek Prime Minister Lucas Papademos said Greece faces the risk of a disorderly default in March if it doesn't complete negotiations for the country's second bailout loan.
The troika of the European Commission, the European Central Bank and the International Monetary Fund is in the process of negotiating a second, €130 billion bailout package that could provide Athens additional money if Greece is considered to be implementing agreed reforms.
IMF losing confidence in Greece's ability to reform-report
7 January 2012,by Brian Rohan - Berlin (Reuters)
The International Monetary Fund is losing confidence in Greece's ability to clean up its public finances and work off its mountain of debt, German magazine Der Spiegel reported on Saturday.
Citing an internal IMF memo, the news weekly said the body considered Greece's current readjustment programme insufficient and that new measures would have to be taken if the country is to avoid default and meet targets agreed with creditors.
The magazine said the IMF saw three options: either Athens enacts further austerity measures, private creditors write off more of their investments in the country's sovereign debt, or states in the euro zone increase bailout aid.
Earlier on Saturday, an adviser to Germany's finance minister Wolfgang Schaeuble told a Greek newspaper that a 50% write-down on Greek debt holdings, part of Greece's debt swap deal, is not enough to put the country on a viable path.
Banks and investment funds have been negotiating with Athens for weeks on the scheme, which aims to cut Greece's debt-to-GDP ratio from 160% to a more manageable 120 percent by 2020 -- a key part of the country's second, €130 billion bailout.
Der Spiegel, in its edition that hits news stands on Sunday, says this 120% target is now in question.
It said the IMF had strong criticism for Athens' sluggish structural adjustment, especially regarding tax collection and state asset sales.
Greece to 'sell bonds backed by state property'
07 January 2012, (AFP)
Crisis-hit Greece plans to sell bonds with state property as collateral to buy back sovereign debt and postpone a privatisation drive under unfavourable market conditions, a report said on Saturday.
To Vima weekly said the Hellenic state asset development fund, an agency set up last year to manage Greece's asset sales, plans to create a privatisation bond to buy back part of the country's enormous debt on the secondary market.
For every one billion euros earned by the planned bond, the state will be able to buy back older debt worth €2.5 billion given the currently depressed value of Greek debt, unnamed agency officials told the newspaper.
Greek state debt, which has exploded to over €350 billion ($447 billion), is currently trading up to 35% below its face value, To Vima said.
Athens last year pledged a sweeping privatisation drive in return for bailout loans from the European Union and the International Monetary Fund.
The process originally aimed to raise €5.5 billion by the end of the year, and €50 billion overall by 2015.
But targets have been revised owing to procedural delays and fears that a hurried sale in the present economic downturn will only bring limited revenue.
In December, Greece sold four disused Airbus A340 jets for $40.4 million, a sum which aviation unionists dismissed as scrap value.
The privatisation list includes ports, regional airports, utilities and motorways, a leading casino, public-owned defence, train and mining companies, and a key stake in Greece's monopoly gaming operator.
Greece should quit euro unless "massive" funding given: Czech
(Reuters) - Greece should leave the euro zone and devalue its new currency unless Europe is willing to provide "massive" funding for the indebted country, Czech central bank Governor Miroslav Singer said in a newspaper interview.
Singer told daily Hospodarske Noviny Europeans should focus on helping banks which may need recapitalisation and on issues that can be resolved, rather than devoting attention for years to Greece which represents just two percent of the European economy.
"If there is not the will to give Greece a massive amount of money from European structural funds, I do not see any other solution than its departure from the euro zone and a massive devaluation of the new Greek currency," he said in the interview to be published on Monday.
"So far Greece has been given loans that served mainly for buying time and for rich Greeks to move their money out of the country. This lowers the trustworthiness of Europe and the willingness of non-European countries to lend or provide new capital to the International Monetary Fund for helping Europe."
Greece Spends Bailout Cash On European Military Purchases
9 January 2012, by Tyler Durden (Zero Hedge)
European Companies Are Now Funding European Banks And The ECB - Is "Investment Grade" Cash Really Just Italian Treasurys?
9 January 2012, by Tyler Durden (Zero Hedge)
ECB policymaker wants banks off Greece bailout hook
6 January 2012, by Paul Carrel - Frankfurt (Reuters)
Furor in Greece over pedophilia as a disability
January 9, 2012
Greek disability groups expressed anger Monday at a government decision to expand a list of state-recognized disability categories to include pedophiles, exhibitionists and kleptomaniacs.
The National Confederation of Disabled People called the action "incomprehensible," and said pedophiles are now awarded a higher government disability pay than some people who have received organ transplants.
The Labor Ministry said categories added to the expanded list — that
also includes pyromaniacs, compulsive gamblers, fetishists and sadomasochists — were included for purposes of medical assessment and used as a gauge for allocating financial assistance.
But NCDP leader Yiannis Vardakastanis, who is blind, warned the new list could create new difficulties for disabled Greeks who are already facing benefit cuts due to the country's financial crisis.
Private creditors tell Greece time running short
12 January 2012, by Polya Lesova - London (MarketWatch)
Charles Dallara and Jean Lemierre, co-chairs of the Steering Committee of the Private Creditor-Investor Committee for Greece, said in a statement on Thursday that talks with the Greek government will continue in Athens on Friday, but "time for reaching an agreement is running short."
Dallara and Lemierre met in Athens on Thursday with the Greek prime minister and the finance minister to discuss a voluntary debt exchange between Greece and the private sector.
"It is essential in order to finalize the voluntary PSI agreement that support be given by all official parties in the days ahead,"
Dallara and Lemierre said in a statement.
Some media reports have said that private-sector investors may have to accept a 60% haircut on the face value of their Greek debt holdings, which would be above the 50% agreed by euro-zone leaders last October.
S&P, Greek standoff pressure euro zone to boost defenses
LONDON (Reuters) - Financial markets are unlikely to be derailed by mass euro zone downgrades but with Greek debt talks at an impasse, pressure has been loaded on the bloc to shore up its defenses and glimmers of optimism from last week have been firmly doused.
With the United States and Japan already downgraded from "AAA" the likes of France and Austria are in good company and Standard & Poor's ratings cuts had been flagged in December. Nonetheless, the upbeat tone that surrounded last week's strong Spanish bond auction now seems a distant memory.
"The euro zone crisis is now dominating market activity again, after a period in which better economic news from the U.S., and easier monetary policy in China had helped markets move higher," said Dominic Rossi, chief investment officer, equities, at Fidelity Worldwide Investment.
U.S. markets are closed Monday for the Martin Luther King holiday but the euro zone will not have to wait long for a test of investor appetite.
Greek default fears grow as talks stall
January 16, 2012 ATHENS/LONDON (Reuters)
Greece's private sector creditors warned on Monday that the Athens government must urgently break a deadlock in debt swap talks triggered by "unreasonable" demands from international lenders if is to avoid a disorderly default.
Barely a month after an injection of bailout funds helped to avert bankruptcy, Greece is back at the centre of the euro zone crisis as fears of a default and a subsequent euro zone exit overshadow a mass credit downgrade of euro zone countries.
Cash-strapped Athens needs a deal with the private sector within days to avoid going bankrupt when 14.5 billion euros of bond redemptions fall due in late March.
But talks with its creditor banks broke down on Friday over the interest rate on new bonds Greece will offer and a plan to enforce investor losses. Negotiations were suspended until Wednesday, and Athens sent senior officials to Washington to consult with the International Monetary Fund.
Greeks strike against austerity as EU, IMF visit
January 17, 2012 ATHENS (Reuters)
Thousands of angry Greek workers marched to parliament on Tuesday to protest against austerity, waving banners reading "EU, IMF out!" as Athens' lenders arrived for talks in a race against the clock to avert a messy bankruptcy.
Greece's private sector creditors warned on Monday that the government must urgently break a deadlock in negotiations on a plan to slash the country's debt if is to avoid a disorderly default when a major bond redemption comes due in late March.
A team of EU, IMF and ECB officials start combing through Athens' books on Tuesday as part of efforts to put together a 130-billion-euro rescue package the country needs, together with the debt swap deal, to stay afloat.
But ordinary Greeks, who have been hit hard by tax hikes and spending cuts which were part of a first bailout agreed in 2010, fear more austerity and wage cuts with the second bailout and say they cannot take more belt-tightening.
They Are Actually Going To Let Greece Default!
The only question is whether it is going to be an orderly default or a disorderly default. Of course the EU (led by Germany) could save Greece financially if it wanted to. But Germany has decided against that course of action. Many in the German government are sick and tired of pouring bailouts into Greece and then watching Greek politicians fail to fully implement the austerity measures that were agreed upon.
At this point a lot of German politicians are talking as if a Greek default is a foregone conclusion.
For example, Michael Fuchs, the deputy leader of Angela Merkel's political party, recently made the following statement: "I don't think that Greece, in its current condition, can be saved." But that is not entirely accurate. Greece could be saved, but the Germans don't want to make the deep financial sacrifices necessary to save Greece. So instead they are going to let Greece default.
Many prominent voices in the financial world that have been watching all of this play out are now openly declaring the Greece is about to default. Moritz Kraemer, the head of S&P's European sovereign ratings unit, made the following statement on Bloomberg Television on Monday: "Greece will default very shortly. Whether there will be a solution at the end of the current rocky negotiations I cannot say."
Greece: Eurozone won't add cash if bond talks fail
ATHENS, Greece (AP) — Eurozone countries won't increase financial support for Greece if it fails to secure a bond-swap deal with private creditors, the country's foreign minister warned Thursday.
Foreign Minister Evangelos Venizelos's remarks came hours before he held a second day of talks with banking negotiators to reach a deal, known as the Private Sector Involvement, aimed at slashing the country's debt by euro100 billion ($130 billion).
Greece is facing a renewed threat of defaulting on its debts, with a euro14.5 billion ($18.7 billion) repayment looming March 20 and no funds to cover it.
"If there is a (financing) gap, this would have to be covered by a larger contribution from the official sector — that means the eurozone countries, directly or indirectly. And at this point, I do not see any willingness or readiness to increase that contribution," Venizelos told parliament. "So there must be no gap, and the Private Sector Involvement is very important."
What happens if Greece defaults?
January 20, 2012 (Reuters)
Greece is expected to announce a bond swap deal with private sector creditors which will see at least half the value of their investments in its debt written off.
Such a deal is likely to tip the country into default, although that could mean several different things.
The three big credit rating agencies - Fitch, Moody's and Standard & Poor's - downgraded Greece in July after the debt swap plan was unveiled, assigning it "highly speculative" status and warning that losses for private creditors would imply a default. Fitch rates Greece CCC, S&P rates it CC and Moody's Ca.
Fitch and S&P make a distinction between a selective or restricted default, where a borrower stops making interest or principal payments on some debts, and an outright inability or refusal to repay creditors.
Market players often make similar distinctions, referring to "orderly and disorderly," "soft and hard" or "managed and messy" defaults.
Both rating agencies have said a debt exchange under which creditors take losses, whether voluntary or otherwise, would be a selective or restricted default.
"Greece will default very shortly. Whether there will be a solution at the end of the current rocky negotiations I cannot say," Moritz Kraemer, the head of S&P's European sovereign ratings unit, told Bloomberg Television on Monday.
"There is a lot of brinksmanship (going) on and a disorderly default will have ramifications on other countries but I believe policymakers will want to avoid that ... The game is still on."
"It is going to happen. Greece is insolvent so it will default," Edward Parker, Managing Director for Fitch's Sovereign and Supranational Group in Europe, the Middle East and Africa, told Reuters on Tuesday. "So in that sense it shouldn't be a surprise to anyone.
"We have said for a long time that we don't think this (private sector involvement) is the way to go, and we would treat it as a default," Parker said. "It clearly is a default, however they try to spin it."
"It would be a default regardless of the size of the NPV (net present value) loss," Fitch's lead analyst for Greece, Paul Rawkins, said on Wednesday.
]S&P says likely to declare Greece in default
Jan. 24, 2012 NEW YORK (Reuters)
Standard & Poor's will likely downgrade Greece's ratings to "selective default" when the country concludes its debt restructuring, but that will not necessarily destroy the credibility of the European Union, an official with the ratings agency said on Tuesday.
"It's not a given that Greece's default would have a domino effect in the euro zone," John Chambers, the chairman of S&P's sovereign rating committee, said in an event organized by Blooomberg Link.
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Stocks slightly lower on Greek talks worries
NEW YORK (AP) — Stocks fell in the United States and Europe on Tuesday as investors worried that a deal to cut Greece's national debt and hold off a possible financial crisis might fall through.
The Dow Jones industrial average was down 49 points at 12,660 just after 2 p.m. EST. It has risen or fallen less than 100 points in 13 straight trading sessions, the longest stretch of calm since March and April of last year.
Treasury prices rose Tuesday from their lowest levels this year on uncertainty about whether Greece will reach a deal with its creditors. That drew money back into safer investments.
In Europe, Greece's stock market index fell 5.5 percent. Stocks fell less than 1 percent in Germany, France and Spain.
Canadian dollar slides as Greek debt fears weigh
TORONTO (Reuters) - Canada's dollar weakened against the U.S. currency on Tuesday, pulled lower with the euro and commodity prices as a setback in the latest efforts to restructure Greek debt triggered fresh worries about the stability of the euro zone economy.
Athens needs a deal very soon to ensure it can get its hands on funds from a 130-billion-euro rescue plan drawn up by its European partners and the International Monetary Fund. It needs the money before 14.5 billion euros of bond redemptions come due in March.
The market has already priced in an orderly default whereby private stakeholders would take a 50- to 70-percent haircut on their Greek debt holdings, said Benjamin Reitzes, senior economist and foreign exchange strategist at BMO Capital Markets.
"When talks break down you get a little bit more concerned that things aren't going to evolve that way and you get the chance of a disorderly default coming back on the table," he added.
Economic ruin on the horizon for Greece: Germany cast doubts on saving country from financial meltdown
January 26, 2012 – GREECE - Angela Merkel has cast doubt for the first time on Europe’s chances of saving Greece from financial meltdown and sovereign default, conceding that Europe’s first ever multibillion euro bailout coupled with savage austerity was not working after a two-year crisis that has brought the single currency to the brink of unraveling. In an interview with the Guardian and five other leading European newspapers, the German chancellor also insisted – against widespread resistance elsewhere in the eurozone and in the UK – that the European court of justice (ECJ) be empowered to police public spending and budget policies of the 17 countries in the euro. She also called for the eventual creation of a European political union, with many more national powers ceded to a central government, a strengthened bicameral European parliament, and the ECJ assuming the role of Europe’s Supreme Court. Days before the latest EU summit, which, at Merkel’s insistence and evoking scant enthusiasm elsewhere, is to finalize an international treaty between eurozone governments entrenching German-style fiscal and budgetary rigor in all single currency countries, the chancellor admitted having doubts about the strategy she had pursued during the crisis. “We haven’t overcome the crisis yet. Of course, there’s Greece, a special case where, despite all the efforts that have been made, neither the Greeks themselves nor the international community have yet managed to stabilize the situation.” Asked about the European response over the past two years, during which Berlin has often dictated terms and encountered strong resistance in Brussels, Paris, and at the European Central Bank in Frankfurt, Merkel said: “Good politicians always have doubts, as a way of constantly reviewing whether they are on the right track.” There were no doubts about her aim – to save the euro and preserve the EU. The reservations concerned the means to those ends. With Europe’s biggest ever crisis moving into its third year, the chancellor is facing growing resistance to her key aim at Monday’s summit – finalizing the “fiscal compact” treaty that is the euro’s new rulebook, foreseeing quasi-automatic fines for fiscal sinners, empowering the Luxembourg-based ECJ to sit in judgment of the 17 countries’ budgets, and establishing legally binding debt ceilings for eurozone governments. –Guardian