Greece Debt Crisis - Après Oxi

Icepick · 06-07-2015 09:24PM

Deleted User wrote: »

What other assets do the Greek banks have other than deposits?

loans and securities but their value is debatable of course
deposits are actually liabilities

06-07-2015 09:31PM

Deleted User wrote: »

Could you think of any reason at all that these aren't already being used as collateral?

ELA requires the Greek Central Bank to with-hold a portion of the securities it holds as collateral as a financial cushion in case "haircuts" (i.e. increased discount rates) are imposed down the line. It's prudent. It's a sort of insurance policy.

The Greek financial system has already reached its ELA limit, and this increased discount rate will "merely" eat into the financial cushion, or 'insurance' that is held by the Central Bank of Greece for precisely this purpose.

frankbrett · 06-07-2015 09:41PM

T bill auction Wednesday of €1.25bn.
They've been able to roll these over with domestic institutions such as government agencies thus far so shouldn't pose a problem

Calahonda52 · 06-07-2015 09:46PM

FreudianSlippers wrote: »

I just don't see how the ECB can agree to any concessions that Greece ultimately wants. The Greek "negotiating position" boils down to debt forgiveness by the ECB at its core. I would imagine that this is just impossible for the ECB to agree to; I'd be livid with our government if Greece were given a debt haircut by the ECB and we weren't demanding a similar cut.

The ECB debt is not really the issue as they can just print it again, its the National Government (aka taxpayers) debt taken on when the 2010 bailout occurred, of which ourt bit is 350 mil

06-07-2015 09:52PM

Calahonda52 wrote: »

The ECB debt is not really the issue as they can just print it again, its the National Government (aka taxpayers) debt taken on when the 2010 bailout occurred, of which ourt bit is 350 mil

Under the Greek plans, and under other proposals, the Irish contribution is not in jeopardy.

Anyway I think the poster is referring to the Syriza proposal regarding the ECB's ability to buy up outstanding sovereign bonds and convert them into zero-coupon bonds. Although if so, he misunderstands the proposal.

chenwc · 06-07-2015 11:33PM

Greece claimed that "Voice of people" should be respected and it is all about democracy. Well, how about the voices from other EU countries? I think Greece's fate should be decided by all EU people not just Greece.
All the EU country should hold a referendum for Greece's fate.

K-9 · 07-07-2015 12:55AM

Deleted User wrote: »

Figured that we might attempt to 'pull' this topic back into the main forum from the café to try and keep the noise levels to a minimum.

Mod:
Request noted. This thread is for people interested in discussing ongoing developments on a mature, adult basis.

The cafe is available for those interested in freer debate, sloganeering, soap boxing.

Basically, if you've problems following lax rules and ight touch moderation in the cafe, I'd suggest not posting here at all, unless there's a marked upgrade in quality. Otherwise you're wasting your own time, and more importantly others who want a reasonable quality discussion.

Jelle1880 · 07-07-2015 02:44AM

http://www.france24.com/en/20150706-eurozones-poorer-nations-take-hard-line-greece

As it stands any new proposal put forward by Greece will have to be very thorough, fair for all parties and strict enough since instead of 4 parliaments last time now all 18 other parliaments of the Eurozone countries will have to agree and all it takes is one No to destroy it.

I can't see it happening with the above link in mind, the Baltic states have already made it clear they have no interest in helping out Greece any more.

jimmycrackcorm · 07-07-2015 03:18AM

QuinDixie wrote:

The EURO was a dreadful decision by all involved. The sooner we are out the better. What we are living through at the moment is pure denial by everyone involved. All EURO countries, politicians and citizens, refuse to admit the obvious truth, the EURO is finished. Greece should be made leave for their own good, as I believe it will not be long before France and Italy will Ask to leave. the debt is unsustainable and growth is not there, 8 years of bad decisions by the troika and nations prove Its just a matter of time.

I can never understand why people say the Euro is a bad or dreadful decision. After all, on a basic level it simplifies trade and travel within the EU. Currency fluctuation and charges just added unnecessary expenses.

Why should the Euro be finished when it isn't the problem. As we've seen in Ireland, the problem has been a lack of fiscal responsibility. Previously the lazy solution was a currency devaluation.

And I think the EU has shown a willingness to bend over to support countries that are willing to make an effort. Greece haven't shown that willingness, whether it is retirement age, military spending, or public spend and tax evasion, they simply won't present the case that they are truly willing to reform. Even their last proposal including tax raises on wealth creation demonstrated their unwillingness to tackle the root core.

If they had that and a their no vote then the EU would have to listen because even the Germans appreciate genuine effort.

Bob24 · 07-07-2015 08:29AM

Jelle1880 wrote: »

http://www.france24.com/en/20150706-eurozones-poorer-nations-take-hard-line-greece

As it stands any new proposal put forward by Greece will have to be very thorough, fair for all parties and strict enough since instead of 4 parliaments last time now all 18 other parliaments of the Eurozone countries will have to agree and all it takes is one No to destroy it.

I can't see it happening with the above link in mind, the Baltic states have already made it clear they have no interest in helping out Greece any more.

Pretty much my thoughs yes.

Given the situation the ECB wants to apply larger haircuts to collaterals and/or recall its assistance package, but they are waiting for a political decision and a green light from EU leaders as they don't want to be the ones pulling the plug due to a technical decision.

At the same time it is now being reported that only 2 EZ members are currently actively campaigning to keep Greece inside, many of the other having expressed they'd rather let the country go (and as you said since this would be a brand new help package it would take more work and approvals that extending the previous one)

So Tsipras actually is in a weaker position to get a deal than he was before the referendum. He would have to come up with some sweeteners to get support from a critical mass of counties; but the problem is those same sweeteners would also be a guarantee fro him not to be able to pass the deal through his own parliament.

We might finally see meeting of the last chance given to Greece that has been announced so many times in the past few months, and it will be difficult for Greece to take that chance.

Crosswind · 07-07-2015 09:29AM

Permabear wrote: »

This post had been deleted.

You can't compare Ireland with Greece (or any other EU country for that matter). The low corporate tax is always an incentive for a business to stay here. You really believe Ireland would recover if it wasn't for the corpo tax?

07-07-2015 09:33AM

Crosswind wrote: »

You can't compare Ireland with Greece (or any other EU country for that matter). The low corporate tax is always an incentive for a business to stay here. You really believe Ireland would recover if it wasn't for the corpo tax?

Who can we compare Greece with?

Can we not compare with controls?

07-07-2015 09:37AM

A Tyrant Named Miltiades! wrote: »

No, you're making the same mistake again.

You're conflating internal devaluation with structural reform. This is an error. Neither internal nor external devaluations are synonymous with such reforms; after all, Greece has already undergone significant internal devaluation without having effected adequate structural reforms.

Can you expand on this please?
What are we counting as an internal devaluation? Just that GDP has decreased?

A Tyrant Named Miltiades! wrote: »

In fact, some of the reforms demanded by the European 'partners' (such as increasing corporate income tax, and increasing employers' social security contributions) actually undermine the internal devaluation that has been achieved.

These were not Troika reforms. These were proposed by Syriza.

A Tyrant Named Miltiades! wrote: »

On the other hand, following a Grexit and an external devaluation, the inability to borrow, and the need to maintain a primary surplus, would leave the Greeks with no options but to take a more business-friendly series of reform. Otherwise, they wouldn't be able to retain a primary surplus.

There is no sense in your attempt to distinguish between internal and external devaluations by claiming that the latter kills Greece. Maybe it's time to abandon your shovel and think of a better criticism.

It's probably as simple as me not understanding quite what you mean by internal devaluation, but could you expand on this too please?

Thanks

Crosswind · 07-07-2015 09:44AM

Quin_Dub wrote: »

So in other words , they did nothing to help the economy - Not a single piece of legislation to make it easier to do business in Greece , nothing to root out Tax evasion/avoidance.

At the same time they were also busy destroying international confidence in the Greek economy through posturing and threats..

Allusions to Fascism , Calling your creditors Terrorists etc. etc. etc.

Those are the thing Syriza did to ruin the economy...

The primary concern of Syriza was to deal with the humanitarian crisis. On that they did well. Regarding economy, they passed the economy restart legislation which has quite a few things approved by the EU among other things. Part of it is here: (sorry but couldn't find an english link, google translate must be used)
http://www.opengov.gr/minfin/wp-content/uploads/downloads/2015/03/SXEDIO_NOMOU_NEW.pdf

Confidence of the economy was destroyed by the pro-austerity parties, domestic and foreign. No need to remind you that everyone was saying before the January elections we'll go to drachma, banks will collapse, the aliens will land on Acropolis and fight Cthulhu and other sci-fi scripts.

Besides, i assume it's fairly obvious by now that the reason the negotiations failed and the referendum was announced was the denial of the creditors to talk about the unsustainable debt restructuring. Tsipras had already agreed to most of the measures proposed by the creditors, despite being opposed by the more radicals of his party.

The Greek people played their part too by paying even less taxes in the last 6 months as they held back on taxes waiting to see if Syriza might cancel them...

Source?

Do you truly believe that Greece is in a better position to work its way back to a functioning economy today then it was last December??

Set aside feelings of Nationalism, Patriotism etc....Do you believe that Greece is now a better place today than it was 6 months ago??

You won't get any nationalism or patriotism from me, quite the opposite :P
Yes, i believe people is way better than before. They had two options:
1) Continue with a failed austerity plan (admitted by both IMF and EU) and lose everything inch by inch.
2) Say NO and expect a hard reset of the economy. Worse short-term, better long-term.

07-07-2015 09:47AM

Crosswind wrote: »

http://www.opengov.gr/minfin/wp-content/uploads/downloads/2015/03/SXEDIO_NOMOU_NEW.pdf

Direct link to google translated doc here - https://translate.google.co.uk/translate?sl=auto&tl=en&js=y&prev=_t&hl=en&ie=UTF-8&u=http%3A%2F%2Fwww.opengov.gr%2Fminfin%2Fwp-content%2Fuploads%2Fdownloads%2F2015%2F03%2FSXEDIO_NOMOU_NEW.pdf&edit-text=&act=url

Crosswind · 07-07-2015 09:47AM

Deleted User wrote: »

Who can we compare Greece with?

Can we not compare with controls?

No one, same way you can't compare Iceland with Argentina.
Each country has unique economic attributes. What works well for one doesn't mean it will work the same for another.

07-07-2015 09:49AM

Crosswind wrote: »

No one, same way you can't compare Iceland with Argentina.
Each country has unique economic attributes. What works well for one doesn't mean it will work the same for another.

We can.

We control for the variables (attributes). It's quite standard.

Crosswind · 07-07-2015 09:49AM

frankbrett wrote: »

The cost of brinkmanship (before capital controls and closing the stock market)

http://www.bloomberg.com/news/articles/2015-06-12/greece-counts-cost-of-one-man-s-gamble

So, the economy started going down and unemployment up 5 months before syriza became government?

Crosswind · 07-07-2015 09:51AM

Deleted User wrote: »

We can.

We control for the variables (attributes). It's quite standard.

Reality says otherwise i'm afraid. It's either that or whoever did the math really fecked up.

K-9 · 07-07-2015 10:44AM

Crosswind wrote: »

So, the economy started going down and unemployment up 5 months before syriza became government?

At least politics never changes no matter the country, nlame the other crowd. It does look like if but it has got worse under Syriza, something I doubt they campaigned, promised their supporters, or planned themselves.

Crosswind · 07-07-2015 10:51AM

K-9 wrote: »

At least politics never changes no matter the country, nlame the other crowd. It does look like if but it has got worse under Syriza, something I doubt they campaigned, promised their supporters, or planned themselves.

Not a fan of syriza, i blame everyone that played a role on this.
I commented on that because, so far, even in this thread, the most popular opinion is that Greece was doing well with the previous government and as soon as syriza came, everything collapsed. The numbers say something different though.

Thomas_. · 07-07-2015 10:52AM

K-9 wrote: »

At least politics never changes no matter the country, nlame the other crowd. It does look like if but it has got worse under Syriza, something I doubt they campaigned, promised their supporters, or planned themselves.

That´s the result of the game this Greek govt. is playing with the EU/ECB/IMF for months since they came into power. It looks like as if this result of the last Sundays Referendum was all well planned and aimed for but it could be the case that it´ll backfire on them and make all things even more worse than they were before.

That´s the politics of radical left-wing Socialist government acting like amateurs in times of crisis. But there you go, that´s what the people wanted cos they voted them in.

07-07-2015 10:54AM

Crosswind wrote: »

Not a fan of syriza, i blame everyone that played a role on this.
I commented on that because, so far, even in this thread, the most popular opinion is that Greece was doing well with the previous government and as soon as syriza came, everything collapsed. The numbers say something different though.

Have you read this piece?

Deleted User wrote: »

Here's an article from the Economist on just this

Crosswind · 07-07-2015 11:03AM

Deleted User wrote: »

Have you read this piece?

I did. Have you read the reforms wanted by IMF?

Grandpa Hassan · 07-07-2015 11:05AM

Crosswind wrote: »

No one, same way you can't compare Iceland with Argentina.
Each country has unique economic attributes. What works well for one doesn't mean it will work the same for another.

Try telling the Eurocrats that. If the model worked for Ireland it must work for Greece, right? And if it doesnt then it is the 100% Greek's fault and they have to go....the troika being blameless of course.

The lack of pragmatism and the clinging to an austerity dogma that must work the same for everyone at all costs now defines for me what the Euro is all about.

07-07-2015 11:09AM

Crosswind wrote: »

I did. Have you read the reforms wanted by IMF?

The originals or the most recent ones?

That the reforms have had to be revised cannot easily be untangled from the effects of Syriza's reign.

Crosswind · 07-07-2015 11:14AM

Deleted User wrote: »

The originals or the most recent ones?

That the reforms have had to be revised cannot easily be untangled from the effects of Syriza's reign.

Whichever ones you want. We can go one by one and see if they would indeed help the economy recover.

Thomas_. · 07-07-2015 11:23AM

Grandpa Hassan wrote: »

Try telling the Eurocrats that. If the model worked for Ireland it must work for Greece, right? And if it doesnt then it is the 100% Greek's fault and they have to go....the troika being blameless of course.

The lack of pragmatism and the clinging to an austerity dogma that must work the same for everyone at all costs now defines for me what the Euro is all about.

I wonder why it is so often omitted that the Greek State never made much efforts to get hold of those of her citizens that are cunning and eager enough to avoid paying taxes and transfer their money abroad.

I´ve not just once read about the attitude of the Greeks regarding paying taxes where it was stated that is "common sense" to either avoid paying taxes or if that´s not possible, to pay as less one can. So where shall the Money come from to consolidate the finances of that Country?

Solidarity is a good thing and I´m all for it, but solidarity doesn´t mean to have others acting the nanny and paying for the faults of the State who is responsible for its own doing in the first place. Still, there is no sign from the Tsipras govt. to get a grip on that one, always putting the blame for all the wrongs on the EU. One should not forget that it turned out that the Greeks fooled the whole of the EU when applying to enter the Euro Zone. The lack of more scrutiny by the EU on the figures that were put forward to the EU and ECB by the Greek govt. to join the Euro is of course the failure of the EU and ECB together. But again, the Greek State has her share in the blame for it, given that in hindsight, they tricked the "Club".

We´ll see how this Greek "Dramas" will continue and how much Money for them will be thrown out of the window for nothing because whatever the proposals are they are coming up with, as Long as they can´t bring about a Change on the tax pay mentality of their own People, there will be no cure to it. Just pay and pay and pay and I think that many people across the EU are already fed up with that "faul Play" by Tsipras and his Comerades.

Greece isn´t the only country that had to cope with austerities, others had to do as well but they weren´t that incapable like this current and their precessors governments altogether.

Crosswind · 07-07-2015 11:34AM

Thomas_. wrote: »

I wonder why it is so often omitted that the Greek State never made much efforts to get hold of those of her citizens that are cunning and eager enough to avoid paying taxes and transfer their money abroad.

I´ve not just once read about the attitude of the Greeks regarding paying taxes where it was stated that is "common sense" to either avoid paying taxes or if that´s not possible, to pay as less one can. So where shall the Money come from to consolidate the finances of that Country?

Solidarity is a good thing and I´m all for it, but solidarity doesn´t mean to have others acting the nanny and paying for the faults of the State who is responsible for its own doing in the first place. Still, there is no sign from the Tsipras govt. to get a grip on that one, always putting the blame for all the wrongs on the EU. One should not forget that it turned out that the Greeks fooled the whole of the EU when applying to enter the Euro Zone. The lack of more scrutiny by the EU on the figures that were put forward to the EU and ECB by the Greek govt. to join the Euro is of course the failure of the EU and ECB together. But again, the Greek State has her share in the blame for it, given that in hindsight, they tricked the "Club".

We´ll see how this Greek "Dramas" will continue and how much Money for them will be thrown out of the window for nothing because whatever the proposals are they are coming up with, as Long as they can´t bring about a Change on the tax pay mentality of their own People, there will be no cure to it. Just pay and pay and pay and I think that many people across the EU are already fed up with that "faul Play" by Tsipras and his Comerades.

Greece isn´t the only country that had to cope with austerities, others had to do as well but they weren´t that incapable like this current and their precessors governments altogether.

Ah yes, the good old tax evasion...
https://ideas.repec.org/p/ces/ceswps/_4004.html

Shall we bring tax avoidance to the table as well and how much it affects the countries where the corp tax should go to in the first place?

Thomas_. · 07-07-2015 11:47AM

Crosswind wrote: »

Ah yes, the good old tax evasion...
https://ideas.repec.org/p/ces/ceswps/_4004.html

Shall we bring tax avoidance to the table as well and how much it affects the countries where the corp tax should go to in the first place?

Why not?

Greece Debt Crisis - Après Oxi

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