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Road to a Grecian turn?

Road to a Grecian turn?

Old Feb 25th 2015, 8:39 am
  #91  
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Default Re: Road to a Grecian turn?

Originally Posted by Red Eric View Post
However, there's some interesting stuff in their proposals - good on them for getting the document submitted in the ridiculously short timescale and I hope they manage to get as much of it under way as possible.
Yes agreed Eric and a definitely a baby step int he right direction. The devil will, as always, be in the detail but the document is a good basis on which to build solid proposals and rebuild the trust and cooperation that got thrown out of the window during the initial negotiations.

As you say the timescale was tight but I suspect it had to be done quickly as Greece needs more bailout money now.

I hope they can make some real progress over the next 4 months, the opportunity is there if they (both the Not-Troika and Syrizia) want to exploit it.

Fingers crossed.
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Old Feb 25th 2015, 2:56 pm
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Default Re: Road to a Grecian turn?

Kicked the can, but as predicted, Syriza is left with some very serious 'splainin to do. I wonder how much longer before mass protests start again.

Outgamed

But Mr Varoufakis’s government also has a rather different constituency to satisfy: opinion at home. Alexis Tsipras, the prime minister, was elected on a pledge to tear up Greece’s bail-outs and leave austerity behind. Mr Varoufakis has spent the last few weeks seeking a “bridging arrangement” as an explicit alternative to a bail-out extension. It is difficult to square these promises with last night’s agreement. Greece has secured no change to the terms of its epic debt, which stands at over 175% of GDP. Its behaviour will continue to be supervised by the institutions formerly known as the troika. It is obliged to refrain from passing any measures that could undermine its fiscal targets; that appears to torpedo vast swathes of its election manifesto, which included all manner of spending pledges.

Hardline members of Mr Tsipras’s Syriza party will find all of this hard to swallow, as will Greeks who thought they had voted for rupture. “The Greeks certainly will have a difficult time explaining the deal to their voters,” was the ungracious verdict of Wolfgang Schäuble, Germany’s finance minister and Greece’s fiercest adversary in the talks of the last few weeks. Expect Mr Tsipras to make much of the few prizes Greece has been able to secure, including permission to run a slightly looser fiscal policy and, with luck, a decision from the European Central Bank to allow the use of Greek government debt as collateral.
Amid the fretting over the euro in the last few weeks, a softer currency has been debased: that of trust. The Germans and others were perhaps guilty of expecting too much too soon from a party elected on an explicit promise to break with the old ways, but Syriza bears the brunt of the blame. It has postured and provoked, making references to Germany’s Nazi past, and jeopardised potential allies in its battle against austerity. It badly mishandled the battle over its bail-out extension, lecturing its euro-zone partners when it ought to have sought accommodation. As a result the talks to come will be more painful, and Greece’s room for manoeuvre more limited, than they would otherwise have been. Mr Dijsselbloem, a man not normally given to eloquence, expressed it best: “Trust comes on foot,” he said last night, “and leaves on horseback.”

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Old Feb 25th 2015, 3:20 pm
  #93  
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Default Re: Road to a Grecian turn?

Originally Posted by amideislas View Post
Kicked the can, but as predicted, Syriza is left with some very serious 'splainin to do. I wonder how much longer before mass protests start again.

Outgamed
Yep - especially your second quote.

And I see Varoufakis is back to posturing again today. That said, and in his defence, they need to placate the voters they lied to, keep their diverse coalition (including the nutters) together and then get sackloads of money from people who no longer trust them a millimetre. If they somehow manage to pull it off it will be quasi-miraculous.

Trust, as you allude to, seems to be the immediate issue and with the erratic (game theory?) tactics employed by Varoufakis so far, that trust is galloping off into distance at a speed that Red Rum would have been proud off.

I am not sure where Syrizia can go from here as living up to their promises at home will cause bigger problems with the Eurozone and the "Not-Troika" which then cuts off their supply of badly needed money. Joseph Heller could not have written this script any better.
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Old Feb 25th 2015, 6:25 pm
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Default Re: Road to a Grecian turn?

Give them a chance - a term is 4 years in Greece. They've been forced to accept a short-term solution but it doesn't mean the manifesto's been torn up.

They must be the first government in 40 years which has a realistic chance of tackling some of the real problems that have existed during that time - the time's right and they've got the mandate from the people plus they're committed to social justice like no previous administration. They might have to dodge a few bullets though, given who they'll be gunning for.

They deserve a bit of support, not this continual backbiting.
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Old Feb 25th 2015, 6:29 pm
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Default Re: Road to a Grecian turn?

Originally Posted by Red Eric View Post
Give them a chance - a term is 4 years in Greece. They've been forced to accept a short-term solution but it doesn't mean the manifesto's been torn up.

They must be the first government in 40 years which has a realistic chance of tackling some of the real problems that have existed during that time - the time's right and they've got the mandate from the people plus they're committed to social justice like no previous administration. They might have to dodge a few bullets though, given who they'll be gunning for.

They deserve a bit of support, not this continual backbiting.
If they weren't so dishonest they might get more support don't you think?

Creative ambiguity!!!!
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Old Feb 26th 2015, 7:53 am
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Default Re: Road to a Grecian turn?

A well balanced article here, which sums up the difficult situation pretty well:

Grexit: Are Greece and the eurozone delaying the inevitable?
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Old Feb 26th 2015, 9:02 am
  #97  
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Default Re: Road to a Grecian turn?

Originally Posted by Garbatellamike View Post
A well balanced article here, which sums up the difficult situation pretty well:

Grexit: Are Greece and the eurozone delaying the inevitable?
As the Euro continues to fall with no rise in inflation the Euro economies are already starting to see a rise in exports.
Countries like Greece which need high volume tourism and some exports will see the benefit this year.
Such improvements may just be a tiny drop in the ocean of debt but they will buy a little more time.
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Old Feb 26th 2015, 10:00 am
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Default Re: Road to a Grecian turn?

Originally Posted by EMR View Post
As the Euro continues to fall with no rise in inflation the Euro economies are already starting to see a rise in exports.
Countries like Greece which need high volume tourism and some exports will see the benefit this year.
Such improvements may just be a tiny drop in the ocean of debt but they will buy a little more time.
You really think so? Not convinced it will make any real difference in the time line maybe a couple or 3 seconds.

Have a read of this non-political article, which looks at the options and difficulties for a variety of courses of action none of which are good options unfortuantely:

Greece and the eurozone are out of good options - MarketWatch
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Old Feb 26th 2015, 1:24 pm
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Default Re: Road to a Grecian turn?

I've read both the articles - neither of them treats the possibility of Greece remaining in the Eurozone but given some relief with any seriousness. The first one talks about Greece being forced out and cites "dozens" of German MPs ready to vote down the extension. I read elsewhere this morning that there are 22 - nowhere near enough to stop it going through the German parliament.

It will be impossible for the new government to undertake a major programme of reforms without some assistance - they have an enormous task on their hands. It would be the same as being told to cut back on expenditure and completely renovate your house at the same time. The EU wants Greece to change, the current government is willing to do so and are largely in agreement on a significant number of points. It is the EU that's been most intransigent here, so far.
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Old Feb 26th 2015, 1:26 pm
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Default Re: Road to a Grecian turn?

Originally Posted by Red Eric View Post
It is the EU that's been most intransigent here, so far.
They have both been intransigent anyone can see that.
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Old Feb 26th 2015, 1:49 pm
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Default Re: Road to a Grecian turn?

Far from it - everybody seems to agree that the Greek representatives gave enormous amounts of ground and the EU barely conceded anything. And given that almost everybody concedes that the debt is unpayable (everybody, that is, apart from the Eurogroup and the IMF) that seems a bit daft.
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Old Feb 26th 2015, 3:34 pm
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Default Re: Road to a Grecian turn?

Originally Posted by Red Eric View Post
Far from it - everybody seems to agree that the Greek representatives gave enormous amounts of ground and the EU barely conceded anything. And given that almost everybody concedes that the debt is unpayable (everybody, that is, apart from the Eurogroup and the IMF) that seems a bit daft.
An interesting interpretation of the facts Eric. However, I have to confess that I remain to be convinced that everyone shares your view (not least 18 finance ministers).

If Varoufakis had started the negotiation with his final letter then he would maybe have got somewhere. He has burnt bridges at every turn with his insulting and erratic behaviour. Moreover, announcing that he had crafted the letter with creative ambiguity so they didn't have to meet the terms is hardly likely to repair the damaged relationship - even if he did it why announce it to the Press? Madness!

As you seem to see the Greek representative is a shining light illuminating a new path for a successful Europe and I perceive him to be dishonest, disingenuious and erratic (ocassionally gusting lunatic) we will probably just have to agree to differ on this one.

The can has been kicked down the road until at least April when the next "Not-Troika" Review of Greek action (or inaction) takes place at least there is some time for them to catch their breath.
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Old Feb 26th 2015, 3:51 pm
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Default Re: Road to a Grecian turn?

The Eurozone has been all but devoid of politically palatable options for some time.

The last-ditch effort of the ECB - Quantitative easing - could take a couple years to deliver any tangible results. But I reckon the Eurozone could well uptick to over 1% growth before the end of 2016.

In the mean time, QE still doesn't address the real problems, which until sorted, will just keep sucking the life out of economic gains from QE spending.
  • Major structural reform (chaos)
  • Spending reform (zero political will)
  • Regulatory reform (limited political will)
  • Tax reform (zero political will)

Last edited by amideislas; Feb 26th 2015 at 3:59 pm.
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Old Feb 26th 2015, 3:54 pm
  #104  
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Default Re: Road to a Grecian turn?

Eric - I am not sure that I agree that Greece "gave ground".
I am in the interesting position of agreeing and disagreeing with BOTH sides.
To me there is absolutely no doubt that Greece will default. They may call it an extension, a bridging loan, they can even call it the end of the rainbow. Ain't going to happen. There is ZERO possibility that Greece can ever repay the amount they owe.
Germany are being intransigent stupid and greedy. They have done extremely well out of the additional weakness that Greece has imparted to the Euro, and will continue to prosper at the expense of every other member state in Europe. To claim some sort of Calvinist rectitude is .. well positively Teutonic. Especially given that the vaunted Hartz reforms were only partially implemented and most of Germany's return to pre-eminence is due to the very advantageous trading conditions as a result of the Euro and NOT to German economic reforms.
Total Greek debt is less than ten percent of German GDP. The sensible thing for Germany to do is to simply admit that much of the bailout money was used to refinance stupid German and French banks and take over the debt. Greece can then start again with a clean slate.
If Syriza have their way, much of the necessary economic reforms will not happen, the Euro will stay weak due to Greece's slide back into debt and Germany can continue selling everybody Mercedes and BMWs that they cannot afford to buy except with money they borrow from German banks. The Euro will weaken further and Germany can continue exporting and saving until they have all the money on the board and the rest of the players in a very crooked game of Monopoly can go home.

Last edited by bigglesworth; Feb 26th 2015 at 3:58 pm. Reason: Logarhea led to crucial missing phrase!.
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Old Feb 26th 2015, 3:57 pm
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Default Re: Road to a Grecian turn?

Originally Posted by amideislas View Post
  • Major structural reform (chaos)
  • Spending reform (zero political will)
  • Regulatory reform (limited political will)
  • Tax reform (zero political will)
Yes I see all that Ami but look as Eric says, it is much simpler if you try and blackmail the rest of the Eurozone into giving you money unconditionally, you can then spend their money on increasing the minimum wage and employing more civil servants without needing to do any of these difficult reforms. Then if someone says no to your entirely reasonable demand - you can accuse them of being intransigent and consider yourself as having the moral high ground. Why get people to pay taxes and have the government spend less when you can just force people to give you more money you can't pay back.
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