Thought Id start this one going because its rather dead on this board at the moment and I suppose all my usual muckers are either at the Stella tennis event watching Dim Tim (lose again) or at Henly Regatta eating cucumber sandwiches (they wish,...NOT).

Anyway please feel free to just talk to yourself blast away and let it go on any company or subject you wish. Just wish Id thought of this one before.

cheers GF.

I can understand that Greece was fed up with austerity. Their reaction was to elect a far left government that lied when it said it could fix things. Those lies have come home to roost and the country is in worse shape than it was before the election. The previous government was applying austerity, but the economy was improving and by now things would have got a lot better. The French did the same thing and now Hollander is the most unpopular leader ever. We are lucky that our electorate was not so stupid.

Greece now wants a referendum on the latest offer. It's a bit late. The time was weeks ago. I think the lending group was right a month ago when they said they needed to talk to adults.

the fault also lies with ECB and IMF for such irresponsible lending over the years

as it now stands, greece cannot possibly repay its debt over any timescale

==============

fred - i think a brief synopsis would be, "f'ed if i can work out what will happen next"

the biggest fear is surely along the lines that russia will buy into greece in exchange for a naval base in the med, or something along those lines

to me, the sensible back down would be for IMF to write-off a huge swathe of debt as it's done elsewhere in the past, in exchange for (inter alia) the greek retirement age being raised to 65

Sense at last!

it will only be sense if something constructive is actually done or even offered
leaving aside tsipras's political leanings, and as i have said, there is no way on this earth that greece can ever repay its debts
however, it is equally clear that greece simply cannot afford such a ludicrously early pensionable age nor any of the other utopian ideas to which tsipras has committed himself so absolutely

Cyners,

Your post above is incorrect. Countries generally raise funds through the bond markets and the issuance of treasury bills. They just issue new coupons to cover redemptions as and when they fall due, thereby rolling over their debt.

The problem for Greece (and others) came a few years ago when they were unable to rollover their bonds and bills. Lenders got nervous and lost their appetite for risk at a time when they had to rebuild their own balance sheets.

It was then that a troika of the ECB, IMF and lenders put together a bailout package. The money they released was conditional upon Greece (and others) implementing austerity measures. Portugal and Ireland implemented their measures and are now safe - Greece have had several years, and they've failed to do anything of any serious note to cut expenditure within that time. This situation is entirely of their own making, it's nothing to do with irresponsible ECB and IMF lending, because they only started lending Greece money as part of the bailout.

happy to be corrected hils, but now what?

as at today's situation, do you think tsipras wrong to tell ECB/IMF to stuff themselves?
all very well hiking VAT and all sorts of other measures that will hit the ordinary working people and it may sound grand to say that the wealthy be be clobbered

however, there aren't that many "wealthy" and the shipping magnates and similar will have shifted their cash and assets already or have them suitably protected

Saturday's PBOC interest rate cut is probably more significant to the financial markets than a potential Grexit, Cyners.

Greece is a small country with some nice beaches. China has a population of 1.3bn and is a massive consumer of energy and user of minerals.

Greece's problem is more their spending than their income.

hils - on a global view you're no doubt correct, but for european markets, the short term outlook must surely be pretty bleak and no doubt usa will reflect this to a considerable degree

what political consequences a collapsed greece might bring in its wake is also uncomfortable - eg russian hegemonic(?) ambitions

Cyners,

Many brokers will move to 'close only' for the Asian session. Any moves before London opens will be on low volume. You won't get the true picture until after London dealers have been at their desk for an hour or so. There's also an old adage in the markets that "the Asians are always wrong".

There is some discussion of whether Monday and onwards for a few days could be a Bank Holiday in Greece. There are large numbers of ATMs now empty.

The IMF and the Euro group have said today that the deal being voted on at the referendum is no longer available.

Greece has said that there may be capital controls from tomorrow.

"This situation is entirely of their own making, it's nothing to do with irresponsible ECB and IMF lending,"


Who do you mean "their own making"?

The dumb waiter who serves you your beer and tapas or the maid who clears up after you.

But, just perhaps, it was some of the wheeler dealers and bankers who have now absconded to other tax dodging communities, hoping to repeat themselves.

UMMMMH.

The conditions of the loans initially set up and accepted by the "Right winged austerity government" seems to me to bear some responsibility.

Gave them a chance to transfer their "goodies" elsewhere".

The referendum hasn't been printed yet!

Mind a Greek island protected by the Russian Navy must have some attraction to a few oligarchs.

Perhaps, a holiday home for Putin!

fred takes his totally predictable stance

hilary is actually correct, though i accept it was not the "fault" of the ordinary chap in the street ...... the gov't of the time was totally irresponsible (even more profligate than the last labour gov't) for not facing up to the reality that you can't just keep spending and not have the consequences eventually coming home to roost

ECB/IMF were also culpable (in my eyes) fornot forcing the issue when they started ladling out further mountains of cheap dosh without imposing tough restrictions from the off

#61028 is spot on the money c, the ordinary joe on the street had little or no part in the madness.

And lets not forget those cuddly Germans with their nice shiny submarines at a billion a pop....on tick.

The land of €l Greco was number one for Porshe shiny car exports ..on tick.

Goldman Sucks cookin de books, whilst the €urobarons looked the other way.


So yes, the bloke in the street is entirely to blame, and should carry the can in to his dotage, serves him right!

Interesting summary!

"What happens on Monday when the banks open?
The Greek central bank has kept the main banks supplied with euro notes. Most branches that opened on Saturday were able to keep churning out notes with a few exceptions put down to administrative hiccups.

ATMs are also expected to be working on Monday, though it is likely that the long queues in some parts of Athens, Thessaloniki and other cities will have forced some of them to be closed.

Much depends on how united the government remains in the face of a backlash from Brussels, which forced the Papandreou government to abandon a similar referendum in 2011. A Northern Rock-style panic could see billions of euros withdrawn electronically by savers and businesses, as happened last week. This would force the ECB to supply further funds to the Greek central bank to cover the shortfall.

What happens on Tuesday when the current bailout expires?
At this point European Central Bank president Mario Draghi and the Frankfurt-based organisation’s board will need to decide if the decision to hold a referendum warrants an extension of its support.

The ECB has purchased Greek bank assets at a discount to maintain a flow of funds from Frankfurt to Athens. If the ECB freezes the operation, the Greek banks would soon run out of cash, forcing the government to impose capital controls.

Will the ECB maintain its funding operation?
Unlikely. Draghi has already made it known that he wants EU politicians – not the ECB – to decide on the fate of Greece. In the meantime Draghi will keep funds flowing to Athens. However, the agreement by EU finance ministers to cut off funding from Tuesday is expected to force his hand.

What about the repayment of €1.6bn to the IMF?
This payment will be missed. It is made up of three separate debt payments due this month rolled up by Athens and delayed until 30 June. A further delay puts Greece in arrears, the IMF said, but not default. Creditors know that calling repayment delays a default could allow private investors, holding about €100bn of debt, to demand their money back and push the country into bankruptcy.

How will a referendum resolve the matter?
Live Greek crisis: ECB caps emergency funding lifeline - live updates
No more extra emergency funding to Greece’s banks, despite steady outflow of deposits since crisis escalated.
Read more
It won’t, unless voters accept the creditors’ terms. A vote to accept their demands will bring forward pension reforms (ending early retirement this week, not over a period of several years), higher VAT rates on medical supplies, catering and purchases made on Greek islands, while abandoning proposals to increase corporation tax rates.

Rejecting the demands will put Syriza back at the negotiating table to repeat its central demand – that expensive short-term loans with the ECB be swapped for cheaper long-term loans with the commission.

Would the creditors back down should voters reject their proposals?
Brussels and the IMF are likely to view the verdict as a preference for life outside the euro, where rules exist to borrow from a central fund and repay according to a negotiated timetable, just as the Irish and Portuguese have done.

The creditors have admitted mistakes in underestimating the damaging effects of previous demands for public spending cuts as the price of bigger loans.

However, it is now the view of most eurozone countries that pension reforms in particular are needed to stabilise Athens’ perilous finances, especially the need to prevent 400,000 people who currently qualify for an early retirement pension being able to somehow get under the wire and claim one."

http://www.theguardian.com/world/2015/jun/28/greek-crisis-what-will-happen-next-referendum

every time, the central plank required for reform and the most immediate way of putting a stop to much nonsense, is for the retirement age to be increased from a totally unsustainable 61 to at least 65

increasing VAT would provide additional instant cashflow but of course would effectively hit the lowest paid the worst
it would also surely encourage cash transactions below the radar of the taxman

It has been announced that the banks in Greece will be closed tomorrow.

If Greece leaves the Euro and probably the EU, it will strengthen Cameron's hand for treaty change. The last thing that Merkel and others will want is the UK leaving the EU as well as Greece.