Financial Crisis in Greece

[George S.]

Assets Greece Handed Over: Airports, Planes, Banks

Assets Greece Handed Over: Airports, Planes, Banks
Tuesday, 14 July 2015

http://macedoniaonline.eu/content/view/27734/46/

With the provocative and dramatic Greek "time out" language pulled from the final finmin and summit draft language, the two most humiliating aspects of the latest extend and pretend "deal" for the Greek people will be the return of the Troika's (surely we can call it the Troika again as part of the Greek capitulation) IMF mission to Athens, and the escrowing of some €50 billion in Greek assets in a liquidation fund.

Granted said fund will not be domiciled in Luxembourg as was originally envisioned, but Europe will still have control and first refusal rights over what are technically Greek properties, in the process Athens handing over about 25% of Greek GDP (and sovereignty) over the Brussels.

What are these assets? For the answer we go to the horse's mouth, Jeroen Dijsselbloem, who laid out the holdings of the proposed Greek privatization that would be sold off as follows: "it still is going to be an independent fund, valued at €50 billion which can be airplanes, airports, infrastructure and most certainly banks.”

Bloomberg quotes the Eurogroup finmin president:

They will be brought in with the target to privatize those in the coming years, but we will take our time for that.

We then hope for proceeds of EU50 billion, but that will be clear later.

The banks first have to be refinanced from this aid program, but after that I take it that they’re worth money and then we can sell them.

The proceedings are aimed at lowering Greece’s national debt. In other words, Greece will be liquidated piecemeal to repay creditors. In even other words, the proceeds from the Third Greek Bailout will not only not reach the Greek people, but Greece will have to sell itself in pieces to top off the creditors' funding needs.

Dijsselbloem concludes: "That is good for Greece, but also good for us. We are in the end the ones from whom the money is borrowed." It was not exactly clear why this would be good for Greece. So for all those curious, here are some of the "assets" that already have, or soon will hit Ebay.

The only caveat: when (not if) Greece defaults again, and it is time to collect on Europe's secured DIP loan (which is what the Third bailout really is) collateral because not even the French socialists can push for a fourth bailout, good luck trying to repossess Aegean islands or the Santorini ferry terminal.

Oh, and for those struck by a case of deja vu, the €50 billion privatization "plan" is nothing new: it was first proposed by the IMF in 2011. What does the IMF say now about this latest privatization proposal? "Not realistic."

Which may be a problem for Greek banks since as the summit deal envisions, half of the privatization "proceeds" will go to recapitalize Greece's insolvent banks. Proceeds which the IMF projects will be about €2 billion until 2018!

This is a problem because with this implicit admission that the Greek financial sector will effectively never receive the needed funds to remain stable, any ELA increase by the ECB will be promptly used by Greek depositors to yank as much money as they can, awaiting the next weekly dose of monetary generosity from Mario Draghi, as both capital controls and the Greek bank run remain a permanent fixture of Greek daily life.

[Bill77]

Damn this is funny...




Iraq is not Greece, says Fitch

Iraq has one of the grimmest economic profiles of any country rated by Fitch. But still a higher debt rating than Greece.

The ratings agency today awarded its first ranking to Iraq: a B- rating that lies deep in junk territory, writes Katie Martin.

B ratings mean "material default risk is present, but a limited margin of safety remains".

Greece, however, is rated CC by Fitch, having been downgraded in June.

http://www.ft.com/intl/fastft/373091/iraq-is-not-greece

[Gocka]

Transfers of wealth

One of the most shocking parts of the whole "Greek crisis", is the fact that a few hundred billion dollars of wealth has been transferred from taxpayers to private banks, and that it hasn't really been portrayed that way.

Basically what has happened is that private European banks made loans to Greece, that Greece couldn't afford to pay back. Had no one done anything, Greece would have had no choice but to default on these loans, and the banks who made the loans would have lost billions of dollars. Greece credit rating would have tanked, they would have had to be pushed out of the Euro and start over with a new currency. This is what the free market would have done.

Instead what European governments did was lend Greece money to pay back these private banks and shift the debt from the banks to the Governments/taxpayers. Basically now the German taxpayers own Greek debt and have personally lent money to Greece. The problem with all this is that Greece was insolvent to begin with, and all you did is shift who they owe money to, they are still insolvent so the problem of Greece not being able to pay back who ever they owe money to still exists. Now instead of private banks losing money when Greece goes bankrupt, taxpayers will lose money. How this is legal is beyond belief. It is a literal transfer of wealth from tax payers to banks.

The same type of deal happened in the USA when the government bailed out big banks in the wake of the 2008 banking crisis. The difference is that at least in the US the banks paid back the loans and tax payers didn't lose money. Greece on the other hand, couldn't pay to begin with, and now they are in even worse shape then in the first place. It is more likely than not that Greece will sooner or later go bankrupt and who ever they owe money to will never get their money back.

The West loves to talk about their "free market" and how it is the savior of us all. Except when they directly intervene to help out their political donors. Out of principle alone these banks who make bad loans should have to take the consequences of their actions. That means that those banks who made bad loans lose billions of dollars, go bankrupt, and in the process average people lose savings and pensions. In my opinion those consequences need to happen for society to actually evaluate whether something is inherently wrong with that system. By artificially propping it up and bailing it out when it makes a mistake you are not only setting a precedent, but also rewarding failure. How many private business owned by the little guy go under every year? How many people lose their life savings in various ways every year? Will the government step in and bail you out when your little mom and pop business goes under? But the mega banks that make money by the hundreds of billions fuck up, someone has to be waiting to lend a helping hand to make sure they can continue to make billions?

I can't believe that we allow this as a society. Personal responsibility and accountability are at the core of a free and democratic society. We work hard for our money and when we mess up we get hammered. That should apply to everyone. I can't believe that governments even have the legal authority to make these types of bailouts without a referendum.

Also as a side note, Greece is also a loser in this situation because the same banks that were bailed out by German taxpayers, will be the first ones to basically snap up all of Greece's now de facto foreclosed public property. The didn't incur loses and will profit from Greece's liquidation sale. What do tax payers get? The get to take the Greek loses into their public budgets, and get a measly .00000001% interest on their savings that are held in these same mega banks that they directly transferred their wealth to. Banks are not evil, people are just ill educated or uninterested.

A hundred years from now people will write about how governments conspired with these banks to pillage the taxpayer and how ignorant the taxpayer was to the whole scheme.

[Gocka]

I also wanted to add to why the average citizen needs to feel the full brunt of the consequences of not bailing out failing banks.

If people realized the dangers of putting our hard earned money into these risky banks then maybe they would rethink letting these banks hold onto their money.

Another reason would be to cause people to think about why we are a credit society. Why do we need to constantly borrow money to buy a house, buy a car, go to college, pay medical bills. We have simply accepted that this is they way the world is without asking ourselves why the world is this way.

The reason we all need to borrow money, is because all the money is concentrated in a few hands, and through inflation and low wages the average person can't actually afford to save any capital to buy things with their own money. Because when you borrow money you pay interest you are further concentrating the money into a few hands.

That is why we are at the stage where this concept is collapsing. Wealth is filtering upwards faster than new wealth can be created from underneath. Its all because of credit. Its a sick dependency that only gets worse over time.

This has not come to the forefront because governments all over the world are artificially propping up these systems because they dont know what else to do.

This is where capitalism is flawed. It works on the principle that new wealth is constantly created. It is constantly created, but most of it still filters back up because the people at the bottom are dependent on capital form above. Not to mention new wealth is also snapped up from above because of competitive advantage.

The sad part is that every economic system enacted throughout human history has always yielded the same result. The result is that somehow wealth always ends up concentrated in very few hands, to the point that the system collapses and a mass redistribution happens and a new "genius" system is enacted. The only system that should mitigate this flow upward is communism, but because of flaws in human character, communism requires much more honesty than human beings are capable of and thus also yields the same results as capitalism, just in a different manner.

In our lifetime, we will see the collapse of capitalism under its own weight. Its inevitable as long as credit is an integral part of society.

[Stojacanec]

I always knew, no matter how dire the situation became between greece and Europe, they were always going to stay in the euro and get the loans.

The austerity measures means nothing to me. They need to wake up and smell the turkish coffee, the country needs to fall to its true equalibrium.

[Philosopher]

Syriza Insider Confirms Tsipras Tried to Take Russia for a Ride

Interview with Syriza insider confirms:

That Tsipras's approaches to Russia were never intended seriously,
That there is no political constituency in Greece, even on the ant-Euro Left, for such a realignment

Alexander Mercouris Subscribe to 92
Wed, Sep 2 | 7,584 Comments
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Tsipras - not a genuine guy

Russia Insider has previously said Greek Prime Minister Tsipras’s approaches to Russia earlier this year during Greece’s negotiations with the European institutions were manipulative and were not intended to lead to a realignment with Russia.

Instead we said that Tsipras was trying to use Russia as a scarecrow to panic the Europeans into concessions.

We also said that though the Russians were initially willing to help, they quickly figured out what Tsipras was up to, so that beyond a certain point their offers of help became progressively less generous.

This was an isolated view. Pretty much all of the rest of the international media was reporting Tsipras’s approaches to Moscow differently. In fact there was a great deal of alarmed - or hopeful - talk about how Greece’s loyalty to the West was in jeopardy, and about how it was preparing to tilt towards Russia and the BRICS.

Confirmation that what we said was true has now come from Stathis Kouvelakis, a former member of Syriza’s central committee, who is close to Panayiotis Lafazanis, Greece’s former energy minister, who now heads Popular Unity, the new left wing grouping formed from former members of Syriza who oppose the latest bailout agreement.

Lafazanis as energy minister negotiated the gas pipeline deal with the Russians. He would therefore have had more intense discussions with the Russians than any other official in the Greek government. Comments from someone close to him, who was also a member of Syriza’s central committee in his own right, should therefore be considered authoritative.

Here is what Kouvelakis had to say in an interview for the French newspaper L’Humanite.

“……..fundamentally the Russians did not know what the Greeks wanted. They were extremely distrustful, since they had the impression that Greece’s moves toward an opening were being used as a card in its negotiations with the European institutions, as a PR tool.

The photos with Putin served as a means of exerting pressure, but it all remained very superficial, and they could tell that it was not going to be followed up with concrete commitments. And they did not appreciate being toyed with.”

This is exactly what we said.

This is not just a historical issue. We have also said that the pipeline deal with Russia negotiated by Lafazanis is doomed.

There continues to be a certain unwillingness to accept this fact with hopes that the deal can still be rescued - though the Russians are unlikely to have any such illusions.

It is indeed the case that the Greeks have on several occasions over the last few weeks assured the Russians that they are committed to the pipeline project.

This should be seen for what it is - an attempt by Tsipras to retain some credibility with his former supporters by not rushing to shelve a deal that is popular with them.

The reality is that with Greece now under the micromanagement of the European institutions there is no possibility of this project being seen through. The Europeans are bound to say it contravenes EU law - to be precise the Third Energy Package - and with Greece under their thumb there is no possibility of the Greeks saying no.


That means that it is only a matter of time before the pipeline deal goes the same way as South Stream.

Only one thing might save the project, and that is an election victory by Popular Unity.

With Popular Unity at present polling only in single figures that looks unlikely.

Even if Popular Unity wins, though the pipeline project may be saved, the realignment with Russia that many hope or fear is unlikely to happen.

As it happens, in his interview, on the subject of relations with Russia, Kouvelakis (who is now one of the leaders of Popular Unity) has some very interesting things to say:

“Developing relations with Russia or with China is not exactly the same thing.

The Chinese interest is in trade and business. We don’t want the privatizations that so attract the Chinese; but at the same time, they have made openings with regard to establishing a BRIC bank.

With Russia, it’s a different matter, since it takes an essentially geopolitical view: for Russia, economic interests are subordinate to this geopolitical outlook.

It is also clear that having relations with Russia in no sense means thinking that Putin is politically or ideologically close to us. This is a question of international relations.”

These sentiments are no less manipulative than those of Tsipras.

Instead of a serious intention to build a firm relationship based on mutual interest and trust, there is an arrogant assumption that Greece’s supposed geopolitical importance to Russia can be used to Greece's advantage.

Such an approach, if it is ever attempted, would be bound to fail since it grossly overestimates Greece’s geopolitical importance to Russia - which in reality is slight.

It is anyway simply wrong that the Russians subordinate their economic interests to their geopolitical goals. That is a common Western trope but there is no evidence to support it.

There continues to be a wide belief or hope that the genuine regard Greeks and Russians have for each other and their shared Orthodox faith somehow means that a political alignment of Greece and Russia is only a matter of time.

Those who entertain this hope are setting themselves up for disappointment.

When even one of the leaders of Greece’s main Leftist anti-euro party can only think of relations with Russia in a manipulative way, the conclusion has to be that prospects for a genuine partnership between Greece and Russia simply don’t exist.

http://russia-insider.com/en/politics/syriza-insider-confirms-tsipras-tried-take-russia-ride/ri9463

[George S.]

My surprise is how can the eu keep on taking shit on and on helping the greeks cope with the debt and they aren't even cooperating fully.

[George S.]

The eu had given the greek govt 180 billion eu.

[JJAskiz]

Comedy Channel: Open Slather making fun of the Greek Crises funny music video from movie Grease.

LMFAO!

XD

https://www.thecomedychannel.com.au/videos/open-slather-greece-crisis-sketch/

[Benito]

Comedy Channel: Open Slather making fun of the Greek Crises funny music video from movie Grease.

LMFAO!

XD

https://www.thecomedychannel.com.au/videos/open-slather-greece-crisis-sketch/

So the Greek crisis is something funny? The maas unemployment and the millions of people iwith limited acces to their money... I don't think it's a funny thing and i think it's a shame the Greek people have to suffer...

[JJAskiz]

It's called "Karma" coming back and biting the Turko-Albanian Greek Gypsies from the Former Turko-Albanian Undemocratic Republic Of Greece (Hell Ass) back in the ass for all the bad shite they have done.

[Benito]

It's called "Karma" coming back and biting the Turko-Albanian Greek Gypsies from the Former Turko-Albanian Undemocratic Republic Of Greece (Hell Ass) back in the ass for all the bad shite they have done.

So what is the reason that Macedonia is a part of Greater Albania now (or let's say, in a few years?) And that the majority of Macedonia is not Macedonian? Karma?

[JJAskiz]

So what is the reason that Macedonia is a part of Greater Albania now (or let's say, in a few years?) And that the majority of Macedonia is not Macedonian? Karma?

That will never happen because the Shiptare (Albanian) minority in Republic Of Macedonia is less then 17%.

http://macedoniaonline.eu/content/view/19334/1/

And also the we have the Serbs and the Russians to help us this time and we will kick the asses of the Shiptari (Albanians) again just like we did in 2001 before the Americans and USA came and got involved and saved the asses of the Shiptare (Albanian) minority in 2001 when they were getting slaughtered by the Macedonian Army and Macedonian freedom fighters of Republic Of Macedonia.

[Benito]

That will never happen because the Shiptare (Albanian) minority in Republic Of Macedonia is less then 17%.

http://macedoniaonline.eu/content/view/19334/1/

And also the we have the Serbs and the Russians to help us this time and we will kick the asses of the Shiptari (Albanians) again just like we did in 2001 before the Americans and USA came and got involved and saved the asses of the Shiptare (Albanian) minority in 2001 when they were getting slaughtered by the Macedonian Army and Macedonian freedom fighters of Republic Of Macedonia.

This is almost a quart of the population (i think its almost 25%). The north-west of Macedonia is one big islamic paradise (look at north Skopje). Mosques, head scarfs, Albanian flags, shops, and ofcourse the terrorist attacks in Kumanovo not long ago. Macedonian policemen have been killed and more of this Albanians are planning attacks at this moment (specially in the south of Serbia). It would be crazy if you don't recognize this as a very big threat.

[George S.]

Its all to do with greed and the belief that the govt owes you a pension.No wonder there are huge debts.Everyone wants the easylife.