Greece crisis: Europe on edge over snap election

[Herr Tubthumper]

Sorry, I don't think you do.

Fare enough. But I feel people who know me will believe I'm sincere.

 

[TomandJerry]

How Greece could avoid defaulting on the ECB

There is a way that Greece could agree a bailout programme and avoid defaulting on its payments to the European Central Bank in two weeks, if tonight’s negotiations go well.

Europe editor Ian Traynor has been speaking to insiders, and explains:

If the option of a new bailout through the ESM gets a go-ahead, the best predictions of actual cash disbursements are mid-to end August, way too late to stop Greece defaulting big time on the €3.5bn in bonds it must redeem at the ECB on July 20.

When Greece’s 2nd bailout expired last Tuesday, some €3.3bn in ECB profits from its securities markets programme due to Greece also vanished [that’s money that the ECB made from bailing Greece out].

For 2014 the profits amounted to €1.85bn. These are held in an ESM account and could be released to the Greeks if the eurogroup so decided. There is also a further €1.5bn currently held by eurozone governments. This money could also be released to the Greeks -- meaning the ECB problem is effectively solved.

The advantage here is that this money could be released without having to wait for any tiresome parliamentary procedures. But the fly in the ointment here is that both wads of cash need to be authorised by the eurogroup unanimously, meaning that a single country could veto the whole show.

The German finance ministry, for example, has been sending negative signals on this, indeed it has been demanding back €500m of the money held by the ESM, the 2014 profits.

 

[Triggaaar]

Hmmmm. I know you're a smart chap and certainly not one for fishing or fibbing, far from it, so I'm intrigued to know which of my comments you have interpreted as "fascist'. All I can say at the moment is you have misinterpreted my thoughts on the crisis.

I'm flattered, thanks. I'm used to seeing you attack the tories and all right wing policies, and so I guess I'd naturally assume you'd be on the side of the Greek people who are suffering, particularly the millions that are not responsible for the mess their country is in. So it took me quite by surprise to see you have a lack of empathy, and it was probably this comment that seemed most incongruous with the Herr Tub I'm used to:

Blame the EU all you want but you can't escape the fact the blame for this total mess lies solely with the Greeks. They're responsible for their actions, no one else.

I'm personally very much against the way the Greeks as a whole have mocked the concept of work and tax, but even I can see that it's not all their own fault, and despite their mistakes I do understand that people will suffer. I pictured Herr Tub fighting their corner, speaking up for the common man and child who will suffer, but that Herr Tub's taken a leave of absence.

 

[cunning fergus]

If multiple people think I lack sympathy for the Greeks then I've clearly written something misleading. I repeat, I do have empathy for their plight. But I also lay the blame for this mess with successive Greek governments and a chunk of the population. These are not mutually exclusive and one doesn't negate the other. I want them to be helped. In amongst my hole-digging I have said a few times I believe a mutually agreeable deal will be struck. I still do.

Well surely for someone with your view on socialism in Europe, and that the British working class should not be protected at the expense of the European working class peers seeking to access the British labour market, your view that the Greek working class should not be protected and thrown to the wolves is double standards.

If you believe in a shared European political construct, which you do unequivocally, this is the ultimate test, and you have failed.

Real socialists like Jeremy Corbyn, understand the position for the Greek working class and want the debt cancelled.............this means the German banks and Govt in particular (ultimately the German taxpayers) take the hit.

http://www.huffingtonpost.co.uk/jeremy-corbyn/greece-economy_b_7688576.html

https://ruptly.tv/vod/view/31199/uk-jeremy-corbyn-stands-with-greece-against-austerity

You don't want the debt cancelled, so not much working class solidarity there.............just naked neo liberal Tory capitalism.

 

[BrickTamland]

The way the Eurozone is structured made something like this happening inevitable if there was a crash any where in the world, especially America. The EU and the Eurozone either needs to gain more control of it's members economies or they go back to individual currencies.

 

[Herr Tubthumper]

I'm flattered, thanks. I'm used to seeing you attack the tories and all right wing policies, and so I guess I'd naturally assume you'd be on the side of the Greek people who are suffering, particularly the millions that are not responsible for the mess their country is in. So it took me quite by surprise to see you have a lack of empathy, and it was probably this comment that seemed most incongruous with the Herr Tub I'm used to:
I'm personally very much against the way the Greeks as a whole have mocked the concept of work and tax, but even I can see that it's not all their own fault, and despite their mistakes I do understand that people will suffer. I pictured Herr Tub fighting their corner, speaking up for the common man and child who will suffer, but that Herr Tub's taken a leave of absence.

I see your point. The post you quoted was aimed at those who are constantly criticising the EU for this mess and seemingly ignoring everything else. I also made the point that numerous right leaning posters who criticised the Labour Party for profligate spending and poor fiscal policy are now happy to back the equally profligate Greece ; I can only presume it's because their opponent is the EU. This was where I was coming from with this particular flurry of posts. On reflection it's fair to say I got a little carried away with this particular theme, and it over shadowed any other thoughts I have on the matter. In fact I didn't really post anything else.

That said I do think the Greeks are the architects of this mess and I don't think the government are helping themselves. But this doesn't mean I am against the people or that I feel they should be punished; I don't want them, or anyone, to suffer and they do have my support. My gut feeling is that a mutually agreeable arrangement will be found and there's a few twists to the saga yet.

I've dug a bit of a hole for myself, so I'll stop digging on this thread now.

 

[Herr Tubthumper]

You don't want the debt cancelled, so not much working class solidarity there.............just naked neo liberal Tory capitalism.

I haven't said anything of the sort. You've made this up.

 

[beorhthelm]

im wondering if those that keep digging at the Germans as the main creditor (56bn) are aware that France, Italy, Spain and rest of eurozone countries are owed 42bn, 37bn, 25bn and 34bn respecitvley? and thats on top of the ECB loans, IMF and that still held by banks. i also wonder if its realised that this is largely due to the previous bailout in 2012, which rolled over debt into longer term, low interest bonds (so some form of debt relief)?

now they want to further restructure or cancel some of that debt, without keeping to the reforms promised 3 years ago let alone new ones. for some odd reason, the leaders of Europe, notably some from Finland, Slovakia, Holland, arent entirely happy about this. this isnt Greece v Germany.

 

[cunning fergus]

I haven't said anything of the sort. You've made this up.

You either support the genuine socialists like Jeremy Corbyn and a policy of debt cancellation of Greek debt by the EU (essentially the Germans) or you don't.

You have enthusiastically supported the policy of the EU and German Govt so far, so evidently you don't want any of the debt cancelled.

The Greeks cannot realistically pay the debt back without some cancellation of their debt, even the IMF have admitted it.

If you support the EU like you do, debt cancellation and asset sharing between poor countries like Greece and rich counties like Germany is the only logical answer..........all for one and one for all right?

You would rather chuck the Greeks out than give up a cent of German debt..........feel free to correct me if I am getting this wrong?

 

[Mellor 3 Ward 4]

http://www.bbc.co.uk/news/world-europe-33437797

I can't understand why they are waiting till Sunday.

The banks will have run out of money by then surely?

 

[cunning fergus]

i wondering if those that keep digging at the Germans as the main creditor are aware that France, Italy, Spain and rest of eurozone countries are owed 42bn, 37bn, 25bn and 34bn respecitvley? and thats on top of the ECB loans, IMF and that still held by banks. i also wonder if its realised that this is largely due to the previous bailout in 2012, which rolled over debt into longer term, low interest bonds (so some form of debt relief)? now they want to further restructure that debt without keeping to the reforms promised rmade 3 years ago. for some odd reason, the leader of europe, notably some from Finland, Slovakia, Holland, arent entirely happy about this. this isnt Greece v Germany.

You are right, however Spain, France, Italy et al could not take the cancellation of debt like the asset rich and much wealthier Germans can.

The German banks are far more exposed than others by some margin; if the Greek debt is cancelled the German taxpayers will just need to bail them out for their profligacy lending money to the Greeks like UK taxpayers bailed out our banks for their reckless lending policies.

If those who want a single currency really want one, this is what needs to happen.........share the pain, the Greeks cannot afford it the Germans can.

 

[TomandJerry]

Donald Tusk then gives a stark warning that there are just five days to avoid the worst-case scenario and save Greece from bankruptcy.

Why are all 28 leaders coming to Sunday’s summit?

We cannot avoid the possibility that there will not be a proposal on the table by Sunday, Tusk says.

And we may need to consider the issue of humanitarian aid for Greece.

I have no doubt that this is the most critical moment in our history - Europe and the Eurozone. No doubt that having all leaders around the table is the right thing to do.

 

[beorhthelm]

You are right, however Spain, France, Italy et al could not take the cancellation of debt like the asset rich and much wealthier Germans can.

The German banks are far more exposed than others by some margin; if the Greek debt is cancelled the German taxpayers will just need to bail them out for their profligacy lending money to the Greeks like UK taxpayers bailed out our banks for their reckless lending policies.

If those who want a single currency really want one, this is what needs to happen.........share the pain, the Greeks cannot afford it the Germans can.

this misses the point. the rest of Europe cant afford it, either way. there's not as much bank exposure as there was, about 50bn in total (and a about 1/5th of that is UK banks iirc). its not point banging on at the Germans about it, as you highlight all those in the single currency are involved, with those governments having a large whole in their finances if there is either a default for a write off. and if Greece had been applying reform the past 3 years, they might have fixed some of their economy and might not need so much in the next bail out. because the other thing people keep ignoring is they have their cap out for another round of borrowing.

 

[TomandJerry]

"Jean-Claude Juncker, president of the European Council, says the Greek crisis is a matter that affects the entire EU.

We have a Grexit scenario, prepared in detail, he reveals.

Thumping the table, Juncker demands to know how Greek officials dared to call the EC terrorists. Greece didn’t manage to supply a detailed reform plan tonight, but they need to do it fast."

"How long does Greece have to produce detailed proposals?

The deadline is 8.30am Friday morning, Juncker replies."

 

[cunning fergus]

this misses the point. the rest of Europe cant afford it, either way. there's not as much bank exposure as there was, about 50bn in total (and a about 1/5th of that is UK banks iirc). its not point banging on at the Germans about it, as you highlight all those in the single currency are involved, with those governments having a large whole in their finances if there is either a default for a write off. and if Greece had been applying reform the past 3 years, they might have fixed some of their economy and might not need so much in the next bail out. because the other thing people keep ignoring is they have their cap out for another round of borrowing.

I agree the bank exposure (across all the banks exposed) has been managed over last few years, however the German banks still have the greatest both in terms of lending and the purchase of Greek debt.

In comparison to Italy, Spain and France the Germans hold the ace cards economically and politically, where they go the rest will follow.

Much of this thread is about how the Greeks got in this mess, I would argue it no longer matters. The Greek state is disintegrating as each day passes and it makes any chance of any stable repayment plan even harder.

One thing that is undeniable though is debt cancellation will have to be part of it.............how generous the Germans are willing to be in this regard is key.

It isn't Greece vs Germany, but it may as well be..........imo.

 

[jakarta]

It isn't Greece vs Germany, but it may as well be..........imo.

Why don't the Germans just decide to call Greece South Germany and take it over lock stock and barrel?

Under new ownership taxes might well be collected properly, the sun beds would continue to be sorted and in the long term we might even want to drive around in Greek made BMW's.

I know there might be some perception of a slight democratic deficit in all this but hey ho....

 

[Hampster Gull]

Why don't the Germans just decide to call Greece South Germany and take it over lock stock and barrel?

Under new ownership taxes might well be collected properly, the sun beds would continue to be sorted and in the long term we might even want to drive around in Greek made BMW's.

I know there might be some perception of a slight democratic deficit in all this but hey ho....

This is a good idea. An alternative is to give the Germans a few (many) islands.

 

[cunning fergus]

This is a good idea. An alternative is to give the Germans a few (many) islands.

I think this may have happened before, it didn't end well.

 

[Hampster Gull]

I think this may have happened before, it didn't end well.

Good point. This time though the Greeks have given up lots of soverignty to the EU and its currency to the Euro. The Islands is just a small step from there

 

[TomandJerry]

Summary: It's deal or Grexit

We’ve seen so many deadlines come and go since the Greek debt crisis began. But tonight, I really believe we’re rattling towards a crucial decision.

Europe*has given Athens one last chance to produce a credible economic reform plan that could underpin a new bailout. It has also threatened that Greece will leave the eurozone if it doesn’t comply before Sunday, when a new emergency summit will be held.

Speaking after tonight’s eurozone summit,*European Council president Donald Tusk warned gravely*that the next five days are the most critical in the European Union’s history.