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Related: About this forumGreece, eurozone agree to extend bailout deal by 4 months
- As I thought would happen, Germany is trying to bluff their way through this. But it won't work this time and they blinked, first. Syriza knows what time it is, and they have nothing to lose. Germany on the other hand, has plenty to lose. And lose. And lose. And lose. And lose some more.
But then, Germany let this happen because of their greed. They knew the books were cooked from the start. And now they must decide if they want to re-work this deal and take a massive haircut, or let the chips fall where they may. The Italian chip. The Spanish chip. The Portuguese chip. And the Irish chip are the ones next in-line. The Italian chip will hurt the most though......
Submitted by Tyler Durden on 02/20/2015 16:28 -0500
As usual, the fine print of any European "deal" is revealed not only after the agreement, but after the US market close. So for all those waiting for the real punchline, here it is - it also is the reason why Greece got until Monday to reveal the list of "reforms" it would undertake:
"Were in trouble next week if creditors dont accept Greeces reforms", Greek Finance Minister Yanis Varoufakis says. "If our list of reforms is not backed by the institutions, this agreement is dead and buried." That's bad. But... "But its not going to be knocked down by the institutions."
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Wolfgang Schauble looks like he needs to layoff the knockwurst and get more fiber in his diet........
rizlaplus
(159 posts)Interesting analysis from Coppola Comment .... it's all a matter of trust it seems!
I have been mulling over the terms of the agreement between Greece and the Eurogoup. Initially, I thought that Greece had ended up with an appalling deal, getting almost none of its aims and losing control of EFSF funding for its banks. The retention of future primary surplus targets under the November 2012 agreement - only the target for this year is under review - seemed particularly harsh. But then I listened to Pierre Moscovici explaining the thinking behind the deal, and suddenly the penny dropped. We've all been missing the point. Holger Schmieding of Berenberg Bank was on the right lines - he commented recently that the real problem in the Greek negotiations was that trust had broken down. Indeed it has. But not recently. Trust in Greece broke down a long time ago.
http://coppolacomment.blogspot.nl/2015/02/greece-and-eu-question-of-trust.html?m=1
Syriza do not have the baggage of previous Greek Governments so it seems this 'agreement' will buy time for the new government to build trust.
DeSwiss
(27,137 posts)Greece and Iceland come to mind right now, but I can't think of many others. Of course I can understand how any group of people would think their elected officials absolutely mad thinking they were doing Greece a favor by accepting the cobbled together, immoral, slight-of-hand deals concocted by the criminal enterprise known as, Goldman-Sachs:
As has been noted previously, all of the countries on the periphery economically in the EU have done such chicanery as Greece did. It was the only way most could qualify for EU membership since the Maastricht Treaty standards were politically unrealistic, because the people making these absurd financial rules didn't have to run for office in the countries they're ruling over.
- But Greece was the one left without a seat, when the music stopped. Spain or Italy will be next, is my guess......
zeemike
(18,998 posts)But is going to trickle down some day...just you wait an see.
You just have to believe.
DeSwiss
(27,137 posts)mother earth
(6,002 posts)desperation and the completely f'd up screws the oligarchy have been inserting in every nation. This wave is mounting, and damn if it isn't the most inspirational moment in a long time..............
K & R, my friend!
DeSwiss
(27,137 posts)TooPragmatic
(50 posts)The Maastricht treaty was created through the EC, which is compiled by the individual governments in the EU, so they did know about getting elected. And the treaty was ratified by every parliament. The EU is a lot more democratic than people think. Commissioners are come through states and are voted by the parliament.
The main problem with the Maastricht treaty was that many governments didn't meet the requirements or they were allowed to brake the rules without repercussions. The fact that countries like Greece faked their stats also undermined the whole treaty as well. But it didn't mean that those goals were impossible.
Deficits under 3%
Debt 60% under GDP
Inflation no more than 2% higher than the lowest countries inflation.
And to say that everyone knew that countries were fiddling with their stats is not entirely true. There is corruption in all countries but it doesn't mean that everyone knew of the magnitudes of the problems. And Goldman should have been held responsible for that the same way as those Greek politicians and officials who were involved, because it was the government that allowed this to happen and they made Greece the most corrupt state in Europe.
The bailout was build for saving European banks, although many did lose money 2012 when they cut part of the debt. But it wasn't about saving German banks, but it was about saving Italian, French and Cyprian banks. Bank contagion was a threat to those countries because back then and markets didn't trust countries like Italy. If Italy had defaulted, it would have been a lot worse. Banks did get off too easily, but they have made stricter rules. The current HBSC investigation could help Greece getting a lot of money if Syriza will prosecute tax dodgers. EU can control and manage banks better through the ECB and joint operations than individual states controlling banks. Currently Ireland, Belgium, Luxembourg and the Netherlands are being investigated for giving multinationals preferential treatment and violating competition rules. Governments should handle these kind of things more aggressively and it can only be done by governments working together.
And I think Greece benefits from being in debt to other EU countries who can give easier terms than financial institutions. But Greece doesn't have a contagion problem and a Greek default could be handled by other countries. One can see this by comparing Greek government bond volatility to other countries and you can see that markets didn't react to the current negotiations hardly at all. But Greece should be in the Euro, so that the currency union project doesn't lose its credibility and it can attract future members.
mother earth
(6,002 posts)the corrupt banks, HSBC is one of the biggest drug money laundering enterprises...that free pass/bailout solution went global. I do believe gov'ts should hold all corrupt entities responsible & accountable, however, what resulted was not a choice of the people & in no shape or form were they made accountable for clear corruption & criminality, in any country.
The Greek problem is, in my estimation, a very clear example of how predatory capitalism corrupts everything it touches.
The Greek problem, is everyone's problem, the world is watching in anticipation of a new beginning towards solving it.
It's my understanding that there's a faction that believes the Grexit is now the only option left on the table, if Syriza is to remain true to its promises, and I believe they have every intention of holding steadfast. (I posted the TRNN interview discussing the interpretation of what is next, with the four month extension. That extension is being painted as capitulation in some corners, I certainly don't see it as such, but more importantly those who really matter don't see it as capitulation. )
If Greece does not remain in the Euro, so that the "currency union project doesn't lose its credibility and it can attract future members", one must only look to those members and ask why no alternative was offered for Greece. The stranglehold must end.
I applaud Syriza, they are the hope of the world.
DeSwiss
(27,137 posts)The idea that these countries were all in the same boat seems to indicate that this thing couldn't have worked from the start without the big boys looking the way. Saying that they were allowed to break rules without repercussions explains why we're here today talking about this.
Greece has a long history (as do most countries) of malfeasance, nepotism and outright theft by elected and appointed officials.
The EU is coming down, but it won't be alone. The entire world's economy is a joke. A bad one. When it finally crashes we must seize the opportunity to create a different world.
- And nothing like what we've had up until now......
Response to rizlaplus (Reply #1)
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