Jul 28

greece

Greek Economy Faces Total Collapse As Doctors Flee, Retail Sales Plunge 70%  (ZeroHedge, July 28, 2015):

Back in May we outlined the cost to the Greek economy of each day without a deal between Athens and creditors.

At the time, a report from the Hellenic Confederation of Commerce and Enterprises showed that 60 businesses closed and 613 jobs were lost for each business day that the crisis persisted without a resolution.

Since then, things have deteriorated further and indeed, with the imposition of capital controls, businesses found that supplier credit was difficult to come by, leading to the very real possibility that Greece would soon face a shortage of imported goods, something many Greeks clearly anticipated in the wake of the referendum call as evidenced by the lines at gas stations and empty shelves at grocery stores.

As a reminder, here’s what WSJ said earlier this monthContinue reading »

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Jul 26

– Europe’s New Colonialism: ECB Rejects Greek Request To Reopen Stock Market (ZeroHedge, July 26, 2015):

It has been one month since Greek capital controls were imposed, and as we explained earlier, Greece is nowhere closer to having its deposit limits lifted. In fact, with several more months of capital controls at least, the Greek banks are likely to suffer ongoing balance sheet impairments which will ultimately result in depositor bail-ins, with Germany already pushing for haircuts on deposits over €100,000.

However, when it comes to banks there is at least still the illusion that Greece has some residual sovereignty. The reality is that it does not, as Greece is no longer an independent nation, and as of July 15, the Greek “In Dependence” day, every Greek decision needs to get pre-approval from both the ECB, Brussels and, naturally, Berlin. Continue reading »

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Jul 15

“What Europe Wants” – to use global issues as excuses to extend its power:

  • environmental issues: increase control over member countries; advance idea of global governance
  • terrorism: use excuse for greater control over police and judicial issues; increase extent of surveillance
  • global financial crisis: kill two birds (free market; Anglo-Saxon economies) with one stone (Europe-wide regulator; attempts at global financial governance)
  • EMU: create a crisis to force introduction of “European economic government”

The Shocking 2008 AIG Report On “Empire Europe” And The Death Of Greece (ZeroHedge, July 15, 2015)

Yesterday, Nomura’s Richard Koo presented one of the better assessments of the situation in Greece, when he said that the “IMF is slowly beginning to understand the Greek economy“, which explains its strategic U-turn, one which now demands far greater debt cuts than what Europe, and Germany in particular, is willing to concede. Continue reading »

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Jul 14

Greek bailout deal highlights monumental scale of Syriza’s betrayal (WSWS, July 14, 2015):

Prime Minister Alexis Tsipras has signed up to an agreement that transforms Greece into a de facto colony of the European Union and places the country under the dictates of Germany.

What remains of the Greek economy, above all its most valuable assets, is to be pillaged so that Athens can continue to pay back loans from the EU, the European Central Bank and the International Monetary Fund.

Greece is to be placed under the direct control of EU officials. The function of Greece’s parliament will be to rubber-stamp the transfer of real authority to Brussels and Berlin. It has until Wednesday to pass a series of laws implementing the demands of German imperialism and the EU. Continue reading »

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Jul 12

Greece May Sue Goldman Over Bank’s Role In Greek Collapse (ZeroHedge, July 12, 2015):

It’s Goldman Sachs’ world, we just happen to live in it.

That rather unfortunate, yet exceedingly accurate, characterization of the global financial and geopolitical landscape seemingly becomes more true with the passage of time and perhaps nowhere is it more evident than Europe, where the common currency experiment (which never had any hope of working without some semblance of a fiscal union) is on the brink of collapse.

Goldman Sachs European Domination

As we noted in “The Biggest Winner From The Greek Tragedy,” the losers from the disintegration of the EMU are ordinary, common, taxpaying Europeans who enjoyed a few brief years of artificial prosperity, which in retrospect was entirely due to debt, masked well by the “currency swaps” and other financial engineering concocted by banks such as Goldman Sachs, in clear violation of the Maastricht treaty which is now a long-forgotten memory of the founding ideals behind the Eurozone. Continue reading »

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Jul 11

Troika Says Greek Proposal Not Enough To Meet Targets, Serves As “Basis For Negotiations” (ZeroHedge, July 11, 2015):

Tsipras betrayed the public trust last night when we rammed through a draft proposal for a Third Greek bailout, one which would push total Greek Debt/GDP over 200%, which the Greek population overwhelming rejected in a democratic vote last weekend. And now, it is up to Europe to decide if it will trust the Greek government, which clearly has no problem lying to anyone, to implement reforms which Greece has been unable to effect for over 5 years.

 

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Jul 10

draghi

Greek Financial Advisor Suing “Politically Motivated” ECB For Crushing Greek Banks (ZeroHedge, July 10, 2015):

The European Central Bank’s decision to reject the Bank of Greece’s request for increases in Emergency Liquidity Assistance (ELA) has, in a nutshell, crushed Greek banks for what appears to be purely political, nogitating-based motives. Greek financial advisor Alcimos (infamous for their heretical comments on the referendum) commenced proceedings before the General Court of the Court of Justice of the European Union, requesting the annulment of the ECB decisions.

The global and European economies are increasingly dominated by bureaucrats taking arbitrary decisions on capital allocation, with little regard for rules or process. The decisions of the ECB to reject the applications of the Bank of Greece for additional funding under ELA could have only been politically motivated, and therefore in clear violation of the ECB’s independence as enshrined in Article 123 TFEU. It is time for EU bureaucrats to stop acting as autocrats. Continue reading »

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Jul 07

Draghi Satan

Peak Central Banker Hypocrisy: ECB Warns On ELA “Moral Hazard” (ZeroHedge, July 7, 2015):

On Monday, the ECB ratcheted up the pressure on the Greek banking sector.

The bank holiday is now in its second week and Greeks have been living with capital controls for nine days. The unequivocal results of Sunday’s referendum suggest that the ‘inconvenience’ of the daily limit on ATM withdrawals and the supplier credit crunch that threatens to empty the shelves at Greek stores hasn’t yet been sufficient to force the country into submission. Continue reading »

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Jul 07

ECB Board Member Says Introduction Of Another Greek Currency “Most Realistic Scenario” (ZeroHedge, July 7, 2015):

ECB Governing Council member and Latvian central bank chief Ilmars Rimsevics — who earlier leaked that the ECB’s new haircut on ELA for Greece will mean the ailing banking sector must now post “a third” more collateral — says the most “realistic scenario” is now for Greece to introduce “another currency.”

  • ECB’S RIMSEVICS SAYS INTRODUCTION OF ANOTHER CURRENCY IN GREECE IS MOST REALISTIC SCENARIO, MAY BE ONE LESS EURO ZONE MEMBER IN FUTURE

Rimsevics

Rimsevics also says Sunday’s referendum outcome means Greeks have effectively “voted themselves out of the eurozone.” Here’s more, via Bloomberg: Continue reading »

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Jul 06

ELA Haircut vs Deposit Haircut

It Begins: ECB Hikes Greek ELA Haircuts; Full “Depositor Bail-In” Sensitivity Analysis (ZeroHedge, July 6, 2015):

Earlier today we reported that as Bloomberg correctly leaked, the ECB would keep its ELA frozen for Greek banks at its ?89 billion ceiling level last increased two weeks ago. However we did not know what the ECB would do with Greek ELA haircuts, assuming that the ECB would not dare risk contagion and the collapse of the Greek banking system by triggering a waterfall solvency rush in Greek banks if and when it boosts ELA haircuts. Turns out we were wrong, and as the ECB just announced “the Governing Council decided today to adjust the haircuts on collateral accepted by the Bank of Greece for ELA.”

Full Press Release: Continue reading »

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Jul 06

Greece Financial Crisis Riotsgreece-athens

ECB To Keep Greece On Hold Until Wednesday When Balyasny Sees Rioting Begin (ZeroHedge, July 6, 2015):

As we have repeated since January, and certainly on numerous occasions over the weekend, at this point the only variable is what the ECB will do: will it give insolvent Greek banks more aid, or will it increase its ELA collateral haircut (or even withdraw it altogether), the ramifications of which action would have a dire impact on contagion within the rest of the periphery but most certainly on both the Greek financial system as well as Greek society which is now facing an indefinitely period of capital controls.

A quick reminder: this is how we laid out the dynamic between Greece and the ECB in on January 31, which 6 months later, has played out precisely as forecast: Continue reading »

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Jul 05

ECB currency printing

IOUs It Is: Why Greece May Have A Problem Printing “Rogue” Euro Banknotes (ZeroHedge, July 5, 2015):

 

Previously we reported that in a heretofore unknown exchange, Varoufakis told Telegraph’s Evans-Pritchard that “if necessary we will issue parallel liquidity and California-style IOU’s, in an electronic form. We should have done it a week ago.” Shortly thereafter, SocGen released a note in which it confirmed largely what the Greek finmin may have said, namely that “Greece is likely to issue a form of parallel currency.”

Continue reading »

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Jul 05

euro crisis can kicking failed

Eurogroup In Shock: Finance Ministers “Would Not Know What To Discuss” After Greferendum Stunner (ZeroHedge, July 5, 2015):

Just out from Reuters:

  • FINANCE MINISTERS “WOULD NOT KNOW WHAT TO DISCUSS” AFTER EMERGING GREEK ‘NO’ VOTE-EURO ZONE OFFICIAL

More: Continue reading »

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Jul 05

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Jul 04

Greek dominos

The Greek Bluff In All Its Glory: Presenting The Grexit “Falling Dominoes” (ZeroHedge, July 4, 2015):

Earlier today, Yanis Varoufakis reiterated his core thesis driving the entire Greek approach from day 1 of its negotiations with the Eurogroup: “Europe [stands] to lose as much as Athens if the country is forced from the euro after a referendum on Sunday on bailout terms.”

This is merely a recap of what we said 4 years ago when in July of 2011 we explained “How Euro Bailout #2 Could Cost Up To 56% Of German GDP“, recall: Continue reading »

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Jul 04

Flashback:

Max Keiser on Greece: ‘The IMF is a Financial Mafia’ (April 28, 2010):

The only solution for Greece is to arrest the Goldman Sachs bankers immediately and all those involved in the fabrication of Greek economic data in 2000, when you became a member of the eurozone. The next step is to nationalize all banks like Sweden did in 1993. The International Monetary Fund is that last thing you need. You will lose your sovereignty. It exercises terrorism. You will be raped in such a way, that it will be the worst pain you have ever felt.


Varoufakis accuses Greece’s creditors of ‘terrorism’ ahead of crucial referendum (RT, July 4, 2015):

Greek Finance Minister Yanis Varoufakis has described the actions of Athens’ creditors as “terrorism,” but said agreement with them was inevitable in an interview published hours before a landmark referendum to accept or reject the bailout terms.

“What they are doing with Greece has a name: terrorism,” Varoufakis told Spain’s El Mundo daily. Why have they forced us to close the banks? To make people frightened. And when it comes to spreading terror, this phenomenon is called terrorism.”
Continue reading »

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Jul 04

Could deposits below €100k be protected as it happened in Cyprus? The answer depends on the total amount of deposits above €100k. If there are enough of these large deposits above €100k, then most likely any required deposit haircut will be inflicted on these depositors only. There are no recent data on how big this universe of large deposits is. The most recent data from the European Commission suggest that at the end of 2012, covered (i.e. those below €100k) represented 75% of eligible Greek deposits. We suspect this number is now significantly higher leaving little room for depositors with less than €100k to be spared.

You’ve been warned, Greece!

Flashback:

Here is what happened to Mexico:

Hedge Fund Manager Kyle Bass Explains The New World Order (Panel Presentation):

On Greece:

For those who think a 50% write-down on debt will fix Greece, you have lost your mind. It is only a full wipe-out of the non-TROIKA-owned debt that is the only mathematical way for Greece to have any chance.

Don’t believe these governments when they tell you everything is going to fine. The day before Mexico devalued by 60% they denied that they would ever devalue. They can and will never tell you the truth. Find your own numbers.

Here is what happened to Belarus:

Belarus Devalues Its Currency By 56% Overnight, Against Every Currency Out There:

Luckily for those who held their “money” in the form of gold and silver, they just got an instantaneous 56% value preservation and a relative boost in their purchasing power with just one central bank announcement.


Will Greek Depositors Under €100,000 Be Spared In Case Of A “Bail-In”  (ZeroHedge, July 4, 2015):

One week ago, we first explained that as the Cyprus bail-in “blueprint” scenario unfolds, the one final, and most important, remaining variable in the ongoing Greek drama, soon to devolve to tragedy, is how big the ECB’s ELA haircuts would be in the case of a No vote, which would be the first catalyst of a depositor haircut.

ELA Haircut vs Deposit Haircut

Then, overnight, in a report since denied by both the Greek finance ministry and by the European Banking Authority Plan, the pro-Europe FT did yet another hit piece on Greece desperate to push those Greek voters on the fence ahead of tomorrow’s referendum to vote “Yes” (just think of the lost advertising revenue if say Deutsche Bank were to go under). Continue reading »

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Jul 02

Euro-QE

Goldman “Conspiracy Theory” Validated As ECB Expands QE Program (ZeroHedge, July 2, 2015):

The ECB has expanded the list of SSA securities eligible for purchase under PSPP. The updated list includes:  Continue reading »

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Jul 01

Equities Soar As Tsipras Said Ready To Accept Most Of Expired Bailout Offer, European Response Muted (ZeroHedge, July 1, 2015):

It’s deja vu all over again.

Just hours after Greece became the first developed country to default to the IMF, as a result being expelled from its existing bailout program, a little before 5am CET news hit that Greek PM Tsipras was willing to concede to virtually all creditor demands, with a few exceptions. As the FT first reported, “Greek prime minister Alexis Tsipras will accept most of the bailout creditors’ conditions offered last weekend, but is still insisting on a handful of changes that could thwart a deal according to a letter he sent late on Tuesday night.” Continue reading »

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Jul 01

For Greeks The Nightmare Is Just Beginning: Here Come The Depositor Haircuts (ZeroHedge, June 30, 2015):

With capital controls already imposed on Greece, some have wondered if this is as bad as it gets. Unfortunately, as the Cyprus “template” has already shown us, for Greece the nightmare on Eurozone street is just beginning.

As a reminder, over the past few months there have been recurring rumors that as part of its strong-arming tactics the ECB may eventually move to raise the haircuts the Bank of Greece is required to apply to assets pledged by Greek banks as collateral for ELA. The idea is to ensure the haircuts are representative of both the deteriorating condition of Greece’s banking sector and the decreased likelihood that Athens will reach a deal with its creditors.

Flashback to April when, on the heels of a decree by the Greek government that mandated the sweep of “excess” cash balances from local governments to the Bank of Greece’s coffers, Bloomberg reported that the ECB was considering three options for haircuts on ELA collateral posted by Greek banks. “Haircuts could be returned to the level of late last year, before the ECB eased its Greek collateral requirements; set at 75 percent; or set at 90 percent,” Bloomberg wrote, adding that “the latter two options could be applied if Greece is in an ‘orderly default’ under a formal ECB program or a ‘disorderly default.’”  Continue reading »

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