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

[CityFarmer]

The changes occur faster than any planning...

Greek referendum: finance minister Yanis Varoufakis resigns – live

http://www.theguardian.com/world/live/20...dd27707ed3

[BlueKelah]

Haha thought he said he resign if yes vote, now is no vote he also resign. This is turning out to be a euro circus show...

sent from my Galaxy Tab S

[CityFarmer]

The ripple effect is too serious to be ignored by U.S. Treasury. I reckon, it will add pressure on ECB, rather than on Greek government.

U.S. Treasury's Lew spoke with Greek premier, hopes talks on resolving crisis resume

WASHINGTON - U.S. Treasury Secretary Jack Lew spoke on Monday with Greece's prime minister and finance minister and said Washington looked forward to Athens and other parties resuming conversations toward resolving the Greek situation, a Treasury spokeswoman said.

Lew voiced hope such an outcome "will allow Greece to make difficult but necessary fiscal and structural reforms, return to growth, and achieve debt sustainability within the Eurozone," the Treasury statement said, adding Lew offered to stay in close touch in coming days.

The call with Prime Minister Alexis Tsipras and the new finance chief, Euclid Tsakalotos, came a day after Greeks voted overwhelmingly in a referendum to reject more austerity.
...
http://www.todayonline.com/business/us-l...sis-resume

[specuvestor]

The changes occur faster than any planning...

Greek referendum: finance minister Yanis Varoufakis resigns – live

http://www.theguardian.com/world/live/20...dd27707ed3

It's actually a good signalling that after gaining an advantage in the polls, they are willing to compromise and talk by removing the rattler.

IMHO I think the Greeks deserve a break to climb out of the hole. Personally I hadn't expected them to win by such margin so debt haircut and restructuring likely coming. Default is academic now and my expectation was incorrect.

[CityFarmer]

The changes occur faster than any planning...

Greek referendum: finance minister Yanis Varoufakis resigns – live

http://www.theguardian.com/world/live/20...dd27707ed3

It's actually a good signalling that after gaining an advantage in the polls, they are willing to compromise and talk by removing the rattler.

IMHO I think the Greeks deserve a break to climb out of the hole. Personally I hadn't expected them to win by such margin so debt haircut and restructuring likely coming. Default is academic now and my expectation was incorrect.

I personally agree, the Greeks should be allowed to climb out of the hole, not because they deserve it, but the cost might be too high to Euro. The direct impact seems negligible, but we all know, the greater damages always from higher-order derivatives.

By observation, Greek current gov has done the best for Greece. What else can be done, under a very unfavorable and necessary negotiation. The hardest part is uncertainties, and seems no-end of tough days ahead. Greek gov knows it, and the end of tough days, will not comes without debt restructuring.

Having said so, ECB has consideration on the reactions from Spain, Italy, and Portugal. A tough job for ECB too.

(sharing a view)

[swakoo]

Notice that with the previous Greek govt implementing reforms, the Greek gdp growth yoy was improving dramatically and turning positive by the end of last year. Alas, they couldn't take the austerity, booted out that govt and voted in a leftist govt in January who had promised a recovery with no pain, sparking the current crisis...

[Image: 30f1ab72-6ec1-4946-aed0-0fe06cf254a2.jpg]

[CityFarmer]

Notice that with the previous Greek govt implementing reforms, the Greek gdp growth yoy was improving dramatically and turning positive by the end of last year. Alas, they couldn't take the austerity, booted out that govt and voted in a leftist govt in January who had promised a recovery with no pain, sparking the current crisis...

I didn't go into the detail, but by observation and the ECB study, the Greek gov is unlikely to re-pay the debt, in known term, even by reform (austerity). I reckon a known schedule to end it, is expected by Greek people.

Are the Greek people don't know the toughness of Grexit? I reckon they should know, but Grexit might very likely mean only 2-3 years of toughness, rather than the seems endless reform (austerity) requirement.

http://www.bloomberg.com/news/articles/2...lion-euros

(sharing a view)

[swakoo]

I didn't go into the detail, but by observation and the ECB study, the Greek gov is unlikely to re-pay the debt, in known term, even by reform (austerity). I reckon a known schedule to end it, is expected by Greek people.

With the previous govt and the gdp recovery by end of last year, the debt to gdp ratio would continue to shrink dramatically (if they were still running the show). This would result in a virtuous cycle of lower cost of debt, more investments, more confidence, more goodwill from creditors, etc. (They were probably on the way to join the club of countries that are recovering with reforms in place: Ireland, Spain, Portugal.)

With the new govt since Jan, all this has been reversed and makes it impossible to re-pay the debt. The commentary we are reading now is based on this situation, not the improving one at end of last year with the old regime.

Are the Greek people don't know the toughness of Grexit? I reckon they should know, but Grexit might very likely mean only 2-3 years of toughness, rather than the seems endless reform (austerity) requirement.

I think Grexit will be much tougher on Greeks than the reforms and measures that had been implemented by the previous govt. If they do not very quickly revert back to the discipline of the previous govt, it will probably be the only alternative left with no cash left in the system, capital controls and banking system shut.

(Am just sharing a view only too, have not gone into details )

[BlueKelah]

Already so jialat liao the greek people still want to continue playing poker with the germans? Just like one who has maxed out on credit cards and have banks chasing for payment, they can either follow the banks payment terms and pay back longer term or declare bankruptcy loh.

Just cut all the pensions should bring them back into budget surplus. Layoff excess gov workers, keep only core workers like police and fireman and teachers and healthcare worker. Prime minister and cabinet can cut their own pay.

Of course no one in greece seems to want to take the responsibility. Well actually 39% did, but in a democratic country thats the minority.

sent from my Galaxy Tab S

[specuvestor]

The problem is the GDP decline has been much sharper than the troika expected and the rebound much less. That's why the debt to GDP ratio is not recovering because the GDP collapsed

http://www.zerohedge.com/news/2015-06-21...-implosion

In some charts one can argue what they are going through is deja vu Great depression. Having gone through the AFC I can sympathise with them why enough is enough.

That doesn't mean Greece shouldn't take responsibility. But it means at least give them a fair chance to climb out the hole and not stuck in a "poverty trap"