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Thread: Greece's Tsipras calls referendum to break bailout deadlock

  1. #71
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    Re: Greece's Tsipras calls referendum to break bailout deadlock

    Quote Originally Posted by Jetboogieman View Post
    Don, I gotta ask.

    What do you predict will happen if they default on the 30th?
    My guess is that Europe will go slow in cutting links. The ECB will continue to finance Greek banks. Things could become dramatically tougher for Greece should the referendum reject the aid package. The IMF has extended an olive branch of sorts appealing to Greece's people. Bloomberg.com reported:

    Negotiations could be revived if Greek voters defy their leaders and show they want to stay in the euro zone, Lagarde said.

    “If there was a resounding ‘yes, we want to stay in the euro for good, we want to be part of that, we want to restore the status of the economy, we want to be sustainable in the long run,’ there would be a resounding ‘let us try,’” she said.


    IMF Won

    Hopefully, more sober heads will prevail in coming days, as failure would amount to a "lose-lose" proposition for Europe and for Greece.

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    Re: Greece's Tsipras calls referendum to break bailout deadlock

    For those who are interested, the referendum question will read:

    “Greek people are hereby asked to decide whether they accept a draft agreement document submitted by the European Commission, the European Central Bank and the International Monetary Fund, at the Eurogroup meeting held on on June 25 and which consists of two documents:

    ‘‘The first document is called Reforms for the Completion of the Current Program and Beyond and the second document is called Preliminary Debt Sustainability Analysis.

    ‘‘- Those citizens who reject the institutions’ proposal vote Not Approved / NO

    ‘‘- Those citizens who accept the institutions’ proposal vote Approved / YES.’’


    Tsipras Asking Grandma to Figure Out If Greek Debt Deal Is Fair - Bloomberg Business

  3. #73
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    Re: Greece's Tsipras calls referendum to break bailout deadlock

    Quote Originally Posted by Jetboogieman View Post
    Don, I gotta ask.

    What do you predict will happen if they default on the 30th?
    Jet, whether Greek exit occurs on Tuesday or not, it will happen when Greece votes 'no' to the referendum, as I think they inevitably will. Talking to some Greek friends this week, the attitude on the street appears to be summed up by this quote from someone queueing up to withdraw cash from a bank:

    It will be no from me, because Greeks are asked to decide between death and death by Europe. I’d rather die by my own choice in my own country, with fellow Greeks, rather than have someone else decide my fate.”

    I don't think it matters much who delivers the coup de grace, the fact is that the Eurogroup are not offering anything. Their austerity measures have failed utterly. That austerity, that the Greeks have been suffering for 7 years have not only seen Greek debt continue to increase, but it has also killed economic growth, increased unemployment and done nothing to promote Greek exports, and yet those are exactly the things that it was claimed the austerity policy would achieve. Why would the Greeks believe that just more of the same would achieve in the future what it has failed to achieve at all in the past?

    The second point to make is that reading the Eurogroup propaganda against Syriza, you'd get the impression that they are to blame for the Greek debt, the failed economic structures of the nation and the corrupt nature of the Greek banking sector. Syriza is the response to those things, and also to the very real and well-documented role that the EU and international institutions have played in creating this mess. Do IFKAT/Troika/Institutions (whatever they are calling themselves this week) believe that Greeks will blame Syriza, who didn't even exist when the debts were run up, or the external accomplices of the bankers and politicians, for the situation? Who would you trust to have the interests of Greek people as their key priority?

    There's also a couple of other points to make about a Grexit. Paul Krugman puts it very clearly and succinctly here. The consequences for the Eurozone may be extreme. The Troika's hubris at the prospect of forcing Greece into default may well prove to be the defining element that brings about the demise of the Eurozone.
    "The crisis will end when fear changes sides" - Pablo Iglesias Turrión

    "Austerity is used as a cover to reconfigure society and increase inequality and injustice." - Jeremy Corbyn

  4. #74
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    Re: Greece's Tsipras calls referendum to break bailout deadlock

    Quote Originally Posted by Manc Skipper View Post
    Any coup would be EU-sponsored, to sideline the democratically elected government of Greece from carrying out it's mandate.
    To be honest here this has all the hallmarks of the IMF. The IMF has done this before. Not sure why we even have the IMF any more as it is motives are clear .. profit and promotion of US economic views.
    PeteEU

  5. #75
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    Re: Greece's Tsipras calls referendum to break bailout deadlock

    Paul Mason absolutely nails the current situation and the prospects for what will happen post-referendum.

    UK Journalist Paul Mason Covering Euro Crisis: Why Greeks Will Probably Vote
    "The crisis will end when fear changes sides" - Pablo Iglesias Turrión

    "Austerity is used as a cover to reconfigure society and increase inequality and injustice." - Jeremy Corbyn

  6. #76
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    Re: Greece's Tsipras calls referendum to break bailout deadlock

    Quote Originally Posted by Andalublue View Post
    Paul Mason absolutely nails the current situation and the prospects for what will happen post-referendum.

    UK Journalist Paul Mason Covering Euro Crisis: Why Greeks Will Probably Vote
    I don't agree. The Prime Minister's punt is anything but a "masterstroke." Moreover, it was understood by all the parties that the first round talks would deal with structural and fiscal consolidation. The second starting later this year would deal with the debt relief issue. Both issues are complex and large differences existed among the parties. It was impractical to negotiate both simultaneously. Had the current Greek government negotiated capably early on, perhaps the fiscal agreement would have been in place months ago and that second round would have started. Instead, it wasted enormous time on loud posturing and self-defeating games of brinkmanship. It has now compounded the issue by punting.

    Was the government incapable of a complex and difficult negotiation? Did its leaders choose to define Greece's interests as those of Syriza, even as Syriza's interests are far narrower than those of the Greek people as a whole? Was the government always inclined to exit the Euro Zone (which it blamed for Greece's predicament), which it pursued under the cover of a difficult negotiation that wouldn't make it obvious given that Greece's people support remaining in the Euro Zone?

    Those are some of the questions that will be examined in the years ahead, even if a moment of sobriety strikes the Greek government and it resumes its basic responsibilities of leadership. It's too soon to tell, but my early guess is that one witnessed elements of the second and third questions.

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    Re: Greece's Tsipras calls referendum to break bailout deadlock

    I might be wrong in #71, but we'll know later. The ECB could cap or continue its emergency liquidity assistance to Greece. However, some European media are reporting that some of its members are inclined to pull the assistance and that they may be sufficient in number to do so.

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    Re: Greece's Tsipras calls referendum to break bailout deadlock

    Quote Originally Posted by donsutherland1 View Post
    I don't agree. The Prime Minister's punt is anything but a "masterstroke." Moreover, it was understood by all the parties that the first round talks would deal with structural and fiscal consolidation. The second starting later this year would deal with the debt relief issue. Both issues are complex and large differences existed among the parties. It was impractical to negotiate both simultaneously.
    With respect Don, that's naive. Without any prospect of debt relief, structural modifications would be impossible and no kind of solution could succeed.

    Had the current Greek government negotiated capably early on, perhaps the fiscal agreement would have been in place months ago and that second round would have started. Instead, it wasted enormous time on loud posturing and self-defeating games of brinkmanship. It has now compounded the issue by punting.
    No one's been wasting time, that's a red herring. Syriza have been in power for exactly 5 months. What they've achieved at home is already quite extraordinary and frankly, the posturing has hardly been exclusively on the Greek side. Schäuble, Dijsenbloem, Merkel, and LaGarde have all been using, let's call it 'undiplomatic' language.

    Those are some of the questions that will be examined in the years ahead, even if a moment of sobriety strikes the Greek government and it resumes its basic responsibilities of leadership. It's too soon to tell, but my early guess is that one witnessed elements of the second and third questions.
    I think that the leadership they are taking is to say, "We'll go as far as we can to cooperate and work to restructure our economy, but we can only go so far. The Troika are offering us nothing but more of the same measures that have been applied and failed for the past 7 years. Perhaps it's time for Greece to say, 'no more' and deal with the consequences by ourselves. What do you say?"
    "The crisis will end when fear changes sides" - Pablo Iglesias Turrión

    "Austerity is used as a cover to reconfigure society and increase inequality and injustice." - Jeremy Corbyn

  9. #79
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    Re: Greece's Tsipras calls referendum to break bailout deadlock

    Quote Originally Posted by Andalublue View Post
    No one's been wasting time, that's a red herring. Syriza have been in power for exactly 5 months. What they've achieved at home is already quite extraordinary
    They have achieved absolutely nothing except to bring Greece closer to bankruptcy. The fact that Tsipras has walked away from the negotiations means he wants to play hardball even though he is the one who needs the money- the pure arrogance of these people and its only the Greek people that are to blame since they voted in these clowns.

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    Re: Greece's Tsipras calls referendum to break bailout deadlock

    Quote Originally Posted by PoS View Post
    They have achieved absolutely nothing except to bring Greece closer to bankruptcy. The fact that Tsipras has walked away from the negotiations means he wants to play hardball even though he is the one who needs the money- the pure arrogance of these people and its only the Greek people that are to blame since they voted in these clowns.
    Would you like to explain what was achieved by the previous Greek governments cooperating with the Troika? The debt rose, the economy shrank, mass unemployment, public employees unpaid. The current deal on offer, without debt relief, means exactly the same thing. The consequences of default and exit might well bring even more severe consequences in the short-term but as Paul Krugman points out:
    But the bigger question is what happens a year or two after Grexit, where the real risk to the euro is not that Greece will fail but that it will succeed. Suppose that a greatly devalued new drachma brings a flood of British beer-drinkers to the Ionian Sea, and Greece starts to recover. This would greatly encourage challengers to austerity and internal devaluation elsewhere.
    The reason why Tsipras is right to call for a referendum is this:
    until now Syriza has been in an awkward place politically, with voters both furious at ever-greater demands for austerity and unwilling to leave the euro. It has always been hard to see how these desires could be reconciled; it’s even harder now. The referendum will, in effect, ask voters to choose their priority, and give Tsipras a mandate to do what he must if the troika pushes it all the way.
    Greece has to decide between two radically different and incompatible positions. Tsipras has concluded that they can't have it both ways given the bullish and vindictive position of the Troika, so they have to choose, as a nation, and it's a choice that didn't appear to be inevitable when he was elected.
    "The crisis will end when fear changes sides" - Pablo Iglesias Turrión

    "Austerity is used as a cover to reconfigure society and increase inequality and injustice." - Jeremy Corbyn

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