Eurozone will collapse...

Agreed...

But the problem is that the Greek Government passed laws making the Greek banks loan the Government money at low interest rates...

[Osem]

Originally Posted by nomadking

Billions are being thrown at the Eurocrats so they can in turn throw it at the Greeks.

They will pursue they're ever closer union, ever larger EU until it blows up in their faces and then still refuse to accept they were wrong and their single state concept flawed from the outset.

[nomadking]

Originally Posted by Hugh

Who loaned it to the Greek banks....

In part, the Greek Pension system.

In 2012, pension funds, which were obliged under a law introduced in 1950 by the then king of Greece, Paul I, to keep a minimum of 77% of their assets in government bonds, took an €8.3bn hit following the restructuring of sovereign debt.

So, the IMF has rejected Greece's reform proposals, and the Greeks have rejected the IMF's counter-proposals. And the clock ticks a second closer to midnight.

http://www.bbc.co.uk/news/world-europe-33258624

[heero_yuy]

So the can gets kicked a little way further down the road. I suspect the Greeks are banking on the Eurozone countries doing anything to preserve the vanity project and giving them the cash anyway.

Will the Germans stump up the readies?

[Osem]

And if they do, what will be the 'euro' pro quo?...

[nashville]

They will never get out of debt, What a situation to bei in

[Kursk]

Well, fair play for the bare-faced cheek. The Greeks are like "we have no money, you'll have to give us some. And some more. We have no way to pay it back ever but the World owes us a living and we intend to go on living with all the luxuries of much wealthier people. Suck it up".

I can't help thinking that it reminds me of something closer to home...

[Ignitionnet]

Originally Posted by Hugh

Agreed...

But the problem is that the Greek Government passed laws making the Greek banks loan the Government money at low interest rates...

Indeed, a long time ago, and thus all is entwined.

We actually have similar requirements that some investment vehicles must invest in UK gilts to an extent I believe.

Regardless, it's probably time that Greece is cut loose. There is no happy ending here, the multiplier from the previous austerity has been terrifying, and their debt to GDP ratio just keeps going up. A primary fiscal surplus is worthless if that ratio keeps rising.

They're suffering bitterly too from deflationary pressures. Greece really could benefit from a big blast of inflation.

This ^

[Ignitionnet]

Can't say Greece looks like a country that needs austerity to me. More one in the midst of a depression.

[Ignitionnet]

So for those who didn't know Syriza have somewhat abrogated responsibility, and have called for that thing that is utterly anathema to the EU - a referendum.

Greece's prime minister has called a referendum on 5 July for voters to decide whether to accept a bailout deal offered by international creditors.

Alexis Tsipras made clear he was against the "unbearable" bailout plan.

Parliament is debating whether to ratify the vote, and some queues have been seen outside banks in Athens.

Well played Syriza, and I can only wholeheartedly approve of taking this to the people, however I'm not so keen on that Syriza are abrogating responsibility somewhat for their manifesto.

http://www.bbc.co.uk/news/world-europe-33296839

Predictable panic at this display of direct democracy in defiance of the Troika. Ball just got thrown well and truly into their court and the referendum can't happen until after Greece have defaulted to the IMF.

http://www.bbc.co.uk/news/world-europe-33299347

---------- Post added at 16:41 ---------- Previous post was at 15:41 ----------

Greece are defaulting to the IMF on Tuesday.

http://www.bbc.co.uk/news/world-europe-33300543

[heero_yuy]

Looks like they've gone for the nuclear option. Now we see how much the rest of the Eurozone want to pay to keep them in.

[Ignitionnet]

Originally Posted by heero_yuy

Looks like they've gone for the nuclear option. Now we see how much the rest of the Eurozone want to pay to keep them in.

Germany can't really keep them in for political reasons. The people have been sold the image of feckless Greeks refusing to take their medicine and being obstinate.

Germans would likely not react well to being told that Greece and the other southern deficit states went into debt buying German exports kept artificially cheap by currency union, and were loaned part of the cash by Germany.

Along with that that the Greek economy was rendered uncompetitive by Germany's internal devaluation and has been laid to waste by a combination of austerity and German mercantilism.

Germany wanted the best of everything, all the advantages of the Euro without having to foot the inevitable bill for their 'beggar thy neighbour' actions. They now demand Greece play by the rules having been happy to tear them up themselves both by their actions in the earlier years of the Euro and with the bailouts which only bear some semblance of legality through chicanery.

http://www.spiegel.de/international/...-a-790333.html
http://www.spiegel.de/international/...-790333-2.html

Greece's new conservative government, elected in 2004, disclosed that its socialist predecessors had been reporting manipulated figures to Eurostat since 2000, including the numbers used to join the euro zone.

But instead of criticizing Greece, European Commission President José Manuel Barroso, a Portuguese citizen, praised the new government for its openness and congratulated it for taking such "courageous steps" to make up for the mistakes of the past. Now it was Greece's job to put its house in order by 2006, Barroso added.

[Kursk]

A tactical referendum: sneaky. Time to find out if the EU has any balls. It cannot wait for the referendum result.