Stunned Greeks React To Initial Capital Controls And The ‘Decree To Confiscate Reserves’, And They Are Not Happy

Greece Financial Crisis Riots
Riots in 2011

… to be repeated in 2015 (?)

Related info:

After Pillaging Pensions, Greece Raids Utilities To Repay Troika; Bonds Plunge As Bank Run Accelerates


Stunned Greeks React To Initial Capital Controls And The “Decree To Confiscate Reserves”, And They Are Not Happy (ZeroHedge, April 20, 2015):

Earlier today, following weeks of speculation, Greece finally launched the first shot across the bow of capital controls, when it decreed that due to an “extremely urgent and unforeseen need” (ironically the need was quite foreseen since about 2010, but that is a different story), it would be “obliged” to transfer – as in confiscate – “idle cash reserves” located across the country’s local governments (i.e., various cities and municipalities) to the Greek central bank.

Several hours later the decree which was posted in the government gazette has finally percolated among the population, and the response to what even ordinary Greeks realize is now the endgame, is less than exuberant.

Bloomberg reports, that “as Greece struggles to find cash to stay afloat, local authorities say they oppose a government decision to use their reserves for short-term financing.”

“The government’s decision to seize our reserves not only raises legal and constitutional issues, but also a moral one,” said George Papanikolaou, mayor of Glyfada, the third-largest municipality in the metropolitan region of Attica after Athens and Piraeus. “We have a responsibility to serve our citizens,” Papanikolaou said by phone on Monday. Glyfada has about 16 million euros in cash reserves, he said.

George is unhappy because as recently as tomorrow, he will find there is precisely zero euros in his public bank account, as all the money has now been forcibly sequestered by the government in order to repay future Troika, pardon, IMF obligations.

Sadly for Greece, this is the only option left as the money has now fully run out: Greek Prime Minister Alexis Tsipras ordered local governments and central government entities to move their cash balances to the central bank for investment in short-term state debt.

From Bloomberg:

The decree to confiscate reserves held in commercial banks and transfer them to the Bank of Greece could raise as much as 2 billion euros ($2.15 billion), according to two people familiar with the decision. The money is needed to pay salaries and pensions at the end of the month, the people said.

“It is a politically and institutionally unacceptable decision,” Giorgos Patoulis, mayor of the city of Marousi and president of the Central Union of Municipalities and Communities of Greece, said in a statement on Monday.“No government to date has dared to touch the money of municipalities.”

It took the radical leftist one all of 2 months since coming to power.

And the punchline is that the use of confiscated proceeds is unclear: the government says it is to pay pensions and wages, but recall that the same government recently confiscated pensions to repay the IMF, so according to the chain of logic, the government first raided pensions, and now municipalities, just to repay the dreaded Troika.

The Athens city council and the union of municipalities and communities in Greece will convene tomorrow to debate the order, a press officer of the mayor’s office said.

And once everyone realizes what just happened, expect the riot cam and the Greek Pay-Per-Riot channel, which has been on hiatus since the summer of 2012, to be fully reactivated.

greek riot photo

4 thoughts on “Stunned Greeks React To Initial Capital Controls And The ‘Decree To Confiscate Reserves’, And They Are Not Happy

  1. This story will have only one end………..and it will expose the excesses not only of corrupt European Central banks, the EU, IMF…….and of the fact the entire western world is now controlled by a few greedy gut bankers; but that the end game is in sight, and the current status quo is unsustainable.

    The entire EU jumped together in short order that a few small nations could become a large buying bloc, much like the US and China of the 1990s……and the details were not examined in depth. All those nations, with the possible exception of Germany, practiced Enron Accounting when listing their assets, all claimed far greater wealth than in fact. All kept the game going by borrowing, and now, the debt level of all EU nations now suffer triple digit debt to GDP.

    The US is over 100%, meaning that every penny that comes in is already spent in obligations to others……..China has been lying like a rug, their debt to GDP is probably every bit as lethal.

    Now, Greece is the first to fall down. When they go, the truth of their debt will expose the falsehood of all the other EU nations, many of which loaned Greece money…….it is a self defeating prophecy……..on a financial scale not seen in modern history. The Crash of 1929 will be a walk in the park in comparison.

    In 1929, the US had a crash, but our currency was backed with gold, and we were the largest lending nation in the world. We built great roads, dams and bridges, putting millions of our men back to work. In 2001-02, and 2007-08, the opposite was and continues to be true. We are today the world’s greatest debtor nation. Just like the EU and China. The entire world economy has been consumed by greedy gut bankers…….they have destroyed the modern world. Thanks to them, we are headed into ruin.

    The one notable exception, regardless of all the propaganda, is Russia.
    India is also growing, but it will take time to see the truth of their true financial worth.

    Greece is the heavy domino hitting all the other EU dominos tottering out there under massive, unsustainable debt.

  2. I would agree with Paul, but Russia would not accept their economy in its present state…..and I don’t blame them. Pity their corporations are so corrupt…..no way to invest in Russia of the next decade……

  3. Sooooo your saying that they are taking money from people to pay back loans that a bank printed out of thin air?! What the fuck is wrong with this scenario!? WHEN WILL WE LEARN TO TELL THEM TO GO FUCK THEMSELVES!!!!!!!

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