Why Greece's spillover across euro area will probably be contained this time

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(08-07-2015, 06:41 PM)sgd Wrote: with the new mandate I read greece want 30% haircut and 20 years before they start paying back.

I think they will get some economic hit men to kill him maybe plane crash.

I thought the discussion now is on 50% cut? Tongue

(not sure, but I recall i read it somewhere)
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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O$P$... irresponsible borrowers always have excuses to borrow more $ and more time... is there anything new?

Greece requests new 3-year bailout
GABRIELE STEINHAUSER THE WALL STREET JOURNAL JULY 09, 2015 7:23AM

Greece has taken a first step toward addressing demands that eurozone leaders say it must meet to stay in the euro, as pressure grew on both sides to reach a deal and avert the country’s imminent financial meltdown.

The government in Athens has formally asked for a three-year bailout from the eurozone’s rescue fund and pledged to start implementing some economic-policy overhauls by early next week, according to a copy of the request seen by The Wall Street Journal.

But whether European leaders accept the application for more emergency loans at a crisis summit on Sunday still depends on Prime Minister Alexis Tsipras making a drastic turnaround on pension cuts, tax increases and other austerity measures after five months of often-acrimonious negotiations.

Eurozone officials expect the request for more aid to be followed up by a full list of detailed policy overhauls and budget cuts that go beyond those that Greek voters overwhelmingly rejected in a referendum last weekend.

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MOREEuro MPs jeer defiant Tsipras
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“The actual examination can only begin once the full package has been put on the table,” said a spokesman for German Finance Minister Wolfgang Schäuble, who has pushed a hard line on Greece and made clear that Germany is prepared for a potential Greek exit from the eurozone.

His comments echo those of German Chancellor Angela Merkel, who said early yesterday that a multiyear aid program would require measures — including changes to labour laws, product markets and the privatisation of state assets — that had been dropped from negotiations in recent months.

As a sweetener, eurozone leaders offered to start discussing measures on how to ease Greece’s immense debt burden. They also suggested that short-term financing to help meet a €3.5 billion ($US3.8 billion) bond payment to the European Central Bank on July 20 could be a part of a broader, longer-term deal.

Since the start of the month, Greece can no longer draw from the €245 billion in rescue loans that have kept it afloat for the past five years. On June 30 the eurozone portion of that bailout expired, while the country’s default on a €1.56 billion payment to the International Monetary Fund last week has made Athens ineligible for more help from there.

Putting itself at odds with Germany and other hawkish euro countries, the US has pressed for more flexibility in bailout negotiations — in particular on debt relief. Treasury Secretary Jacob Lew called on European governments to help reduce Greece’s debt if Athens commits to the necessary overhauls.

“Greece’s debt is not sustainable,” he said.

Greek banks could soon run out of cash, leaving just days to avoid “a life or death” deadline that has escalated the risk of an accidental exit from the eurozone, Mr Lew said at an event at the Brookings Institution.

The IMF, Greece’s biggest creditor outside the eurozone, has long insisted that high debt has been weighing on growth and that the currency union’s governments should take action to reduce it.

“It’s a mistake for the European economy, for the global economy, to take the risks involved with an uncontrolled crisis in Greece,” Mr Lew warned.

Failure to pay the ECB could lead to a cut in emergency lending to Greek banks — a move that would lead to the collapse of the country’s financial system and force the government to print its own money to recapitalise them.

Greek banks have already been shut for more than a week. Cash withdrawals have been limited to €60 a day and depositors can’t transfer funds abroad.

In his first address to the full European Parliament in Strasbourg, France, Mr Tsipras mixed conciliation with defiance, pointing to his countrymen’s resounding “no” vote in Sunday’s national referendum as evidence of a fresh mandate to demand a good deal.

He told politicians, some of whom were holding up “OXI” or “NO” signs in a reference to the Sunday vote, that he would send a detailed list of measures in time for a midnight (8am AEST Friday) deadline set by other eurozone governments.

But Mr Tsipras also said that his government would choose its own measures to ensure that a final deal was “effective and fair.”

“We respect the eurozone rules, but we also have the right to choose where we as a sovereign government will put the tax burden,” he said. “It’s the sovereign right of any government to decide to increase tax on profitmaking businesses and not cut back on the lowest pensions.”

Mr Tsipras said his proposals would contain demands for a “genuine dialogue” on restructuring Greece’s huge debt load, which he said was necessary to give the country a “light at the end of the tunnel.”

“We demand an agreement with our neighbours, but one that gives a sign that we are in a long-lasting basis for exiting from the crisis,” he said.

The letter from Finance Minister Euclid Tsakalotos to Jeroen Dijsselbloem, the chairman of the Eurogroup of finance ministers, and Klaus Regling, the managing director of the eurozone bailout fund, supersedes a request from last week for a two-year rescue program.

It says that some overhauls, including measures linked to taxation and pensions, which have been at the centre of the standoff between Greece and its creditors, would be implemented as early as next week.

The letter also makes a request for debt relief, albeit in much more toned-down language than earlier demands. “As part of a broader discussion to be held, Greece welcomes the opportunity to explore potential measures to be taken so that its official sector related debt becomes both sustainable and viable over the long term,” the letter says.

Senior officials from eurozone finance ministries discussed the aid request in a conference overnight and asked the European Commission and the ECB to assess whether Greece is eligible for more rescue loans, according to a statement from the bailout fund, called the European Stability Mechanism.

Alexander Stubb, the Finnish finance minister, underlined the urgency of a deal in a Twitter message: “5-5-5. Five difficult years. Five mixed months. Five interesting days. A solution has to be found by Sunday. One way or the other.”

Wall Street Journal
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It is educating to view a negotiation between parties, who none has option to walk away. The Greek gov team, has fully leveraged on the "no-option"...

Tsipras pleads for fair deal for Greece in EU parliament

STRASBOURG/BRUSSELS/ATHENS/BERLIN (July 8): Greek Prime Minister Alexis Tsipras pleaded in the European Parliament on Wednesday for a fair deal to keep his country in the euro zone, acknowledging Greece's own responsibility for its plight, after EU leaders gave him five days to come up with reforms.

With its banks closed, cash withdrawals rationed and the economy in freefall, Greece has never been closer to a total state bankruptcy that would probably force it to print an alternative currency and leave the euro.

Yet the leftist premier seemed relaxed and confident, with a note of humility, when he appeared before EU lawmakers in Strasbourg to cheers and scattered boos.

Speaking hours after euro zone peers, at another emergency summit in Brussels, set Greece a deadline of the end of the week to come up with convincing reform proposals, Tsipras said Greeks had no choice but to demand a way out of "this impasse".

"We are determined not to have a clash with Europe but to tackle head on the establishment in our own country and to change the mindset which will take us and the euro zone down," he said to applause from the left.

He promised to deliver detailed reform proposals in the next 48 hours and mostly eschewed the angry rhetoric that has alienated many European partners, although he criticised attempts to "terrorise" Greeks into voting for "never-ending austerity".
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http://www.theedgemarkets.com/sg/node/214699
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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O$P$ at sovereign levels... can't learn from textbooks and again its free if one bother...

(09-07-2015, 09:41 AM)CityFarmer Wrote: It is educating to view a negotiation between parties, who none has option to walk away. The Greek gov team, has fully leveraged on the "no-option"...

Tsipras pleads for fair deal for Greece in EU parliament

STRASBOURG/BRUSSELS/ATHENS/BERLIN (July 8): Greek Prime Minister Alexis Tsipras pleaded in the European Parliament on Wednesday for a fair deal to keep his country in the euro zone, acknowledging Greece's own responsibility for its plight, after EU leaders gave him five days to come up with reforms.

With its banks closed, cash withdrawals rationed and the economy in freefall, Greece has never been closer to a total state bankruptcy that would probably force it to print an alternative currency and leave the euro.

Yet the leftist premier seemed relaxed and confident, with a note of humility, when he appeared before EU lawmakers in Strasbourg to cheers and scattered boos.

Speaking hours after euro zone peers, at another emergency summit in Brussels, set Greece a deadline of the end of the week to come up with convincing reform proposals, Tsipras said Greeks had no choice but to demand a way out of "this impasse".

"We are determined not to have a clash with Europe but to tackle head on the establishment in our own country and to change the mindset which will take us and the euro zone down," he said to applause from the left.

He promised to deliver detailed reform proposals in the next 48 hours and mostly eschewed the angry rhetoric that has alienated many European partners, although he criticised attempts to "terrorise" Greeks into voting for "never-ending austerity".
...
http://www.theedgemarkets.com/sg/node/214699
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Ex-Belgium PM giving angry but constructive passionate advice to Greek PM at the European Parliament yesterday:
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(09-07-2015, 09:41 AM)CityFarmer Wrote: It is educating to view a negotiation between parties, who none has option to walk away. The Greek gov team, has fully leveraged on the "no-option"...

From It’s Time for Greece to Leave the Euro

Quote:A big part of the blame for this mess rests on the shoulders of the chancellor of Germany, Angela Merkel herself. Her statement that “if the euro fails, Europe fails” was understood by Athens as a carte blanche: Greece’s euro membership is obviously priceless to Europe’s most powerful leader. From then on, all credit negotiations between Athens and the eurozone resembled a poker game with the German cards in the open. The fail-fail sentence was easily the most stupid public statement that the usually cautious Ms. Merkel had ever made.

Blame falls on Greece too:

Quote:There was a point when things looked promising. After the European Union and the International Monetary Fund stepped in with their first two bailout programs, Greece made considerable progress on closing its deficits. Between 2010 and 2014 it implemented spending cuts virtually unprecedented in a developed country. Those cuts meant hardship to many in Greece. But they began to pay off: By the end of 2014, Greece was spending less than it was collecting in taxes (if you leave aside interest payments).

But the cuts to social-welfare programs and public-employee salaries also drove up support for the radical left Syriza government, which took over earlier this year. It stopped the reforms and blurrily demanded other, bigger changes, including a “new deal” for all of Europe — whatever this is supposed to mean.
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I am not surprised, the Greek PM is seen as a "hooligan" among the other side of negotiation and other EU members and may be he is. I am viewing the show, from the Greece perspective. The Greek PM has done his best for his people.

Will thing turn out better, if previous reform continue? May be. One thing I am sure, the Greek people should have a right to chose, between an "never-ending austerity" vs "hell but with an end-date". Of course via negotiation with creditors.

(provide an alternative view)
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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now greece default loansharks are circling the next weakest links italy spain portugal rates for these will go up.
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Greek PM is not doing the best for his people. In fact is worst. He only feeds their worst attributes by making them owe more money and be lazy. A Leader lead even when choices are hard.

Just my Diary
corylogics.blogspot.com/


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The urge to be "realistic" among creditors, start to emerge from key players in the game. I am a strong feel, there will be a compromised agreement...

EU's Tusk urges creditors to give Greece debt relief
[LUXEMBOURG] EU President Donald Tusk said Greece's creditors must make a "realistic" proposal for managing the country's huge debt, as Athens faces a midnight deadline to submit reform plans for an international bailout.
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Source: Business Times Breaking News
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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