Eurozone will collapse...

[Osem]

Originally Posted by nomadking

The Greeks were fiddling the books on a widespread scale.

Didn't help that they had a law requiring Greek pension funds to have 77% of their money in Greek bonds. Must have seemed a good idea at the time and probably was.

I know, I posted a link about that dating from 2010 above and they needed help to pull it off. We all know they've been living well beyond their means for decades and they probably hoped EU/Eurozone membership would ensure that their excess would eventually be paid for by others. As it stands they're probably right too because I think a lot of debt is going to be written off in one way or another.

[nomadking]

Originally Posted by Osem

I know, I posted a link about that dating from 2010 above and they needed help to pull it off. We all know they've been living well beyond their means for decades and they probably hoped EU/Eurozone membership would ensure that their excess would eventually be paid for by others. As it stands they're probably right too because I think a lot of debt is going to be written off in one way or another.

They didn't need any help. They were doing all of it themselves. All Goldman Sachs did, as other banks have done with other EU countries, is carry out the Greek government requests of a certain type of financial transaction. The loans arranged that way were for £2.8billion, that is a drop in the ocean for Greece. Whether it went on the books or not, was purely down to the Greek government. The same goes for all the other fiddles, eg publicly owned companies running up massive debts on behalf of the government.

Then Goldman Sachs came to the rescue, arranging a secret loan of 2.8 billion euros for Greece, disguised as an off-the-books “cross-currency swap”—a complicated transaction in which Greece’s foreign-currency debt was converted into a domestic-currency obligation using a fictitious market exchange rate.
...
In the late 1990s, JPMorgan enabled Italy to hide its debt by swapping currency at a favorable exchange rate, thereby committing Italy to future payments that didn’t appear on its national accounts as future liabilities.

[Osem]

You and I are clearly not going to agree about what constitutes external 'help' and whether it was right morally or otherwise. The fact that other countries and banks have done the same thing doesn't make it any better or worse IMHO. The banking practices which were widespread and accepted/overlooked/turned a blind eye to pre 2008 but aren't now are an example of how what's deemed acceptable and what isn't is subject to change. The Greeks are the issue now and I dare say the extent to which other countries have employed dubious accounting methods in order to hide their economic problems will be more fully exposed in due course and a good number of chickens finally come home to roost.

http://www.theguardian.com/business/...ed-libyan-fund

http://www.huffingtonpost.com/2011/0..._n_849708.html

Banks clearly aren't immune from wrongdoing as the various regulators prove regularly. with all those heavy fines they impose. Neither are they strangers to legal actions but only the courts can decide what is or isn't legal in the final analysis and only time will tell...

[Ignitionnet]

http://www.ft.com/cms/s/0/4c7b7f2c-3...#axzz3hNpfWsDn

The International Monetary Fund’s board has been told Athens’ high debt levels and poor record of implementing reforms disqualify Greece from a third IMF bailout of the country, raising new questions over whether the institution will join the EU’s latest financial rescue.

The determination, presented by IMF staff at a two-hour board meeting on Wednesday, means that while IMF staff will participate in bailout negotiations currently under way in Athens, the Fund will not decide whether to agree a new programme for months – potentially into next year.

That delay could have significant repercussions, particularly in Germany, where officials have long said it would be impossible to win Bundestag approval for the new €86bn bailout without the IMF on board.

[Osem]

The Greek debt crisis has saved the German government some €100bn (£70bn; $109bn) in lower borrowing costs because investors have sought safety in German bonds, a study has found.

Even if Greece defaults on all its debt, Germany would still benefit, says the German IWH institute.

Greece is hoping to reach a third bailout agreement, worth up to €86bn, with its creditors this week.

Germany has funded €90bn so far and wants tough conditions for a new deal.

http://www.bbc.co.uk/news/world-europe-33845836

[nomadking]

Does that factor in that the Germans and others have to borrow money in order to give it to Greece? Also half of the Greek debt has already been written off, so where is that in any "calculations".

[Ignitionnet]

Originally Posted by nomadking

Also half of the Greek debt has already been written off, so where is that in any "calculations".

Given it was the privately owned portion of the debt that was written down precisely nowhere I would imagine.

---------- Post added at 11:37 ---------- Previous post was at 11:35 ----------

Originally Posted by nomadking

Does that factor in that the Germans and others have to borrow money in order to give it to Greece?

Yes.

[mrmistoffelees]

How quickly Germany has forgotten it's past

[Osem]

Just in case anyone thought this was all over:

Greece has failed in its attempt to secure the first release of cash under its €87bn bail-out package, as creditor powers deemed the country had failed to make enough progress on passing key reforms


Athens' anti-austerity government will not receive a €2.15bn as scheduled this week, raising fears the country's new rescue programme is stalling at the first hurdle.

• Greek problems here to stay warns tax chief

The government of prime minister Alexis Tsipras has been locked in a duel with creditors over two key issues: a new insolvency law for home confiscations, and revamping the way the country's banks are run.

Eurozone finance ministers, meeting in Brussels on Monday, warned the stumbling blocks could also threaten the process of rehabilitating Greece's battered financial system.

http://www.telegraph.co.uk/finance/e...e-beckons.html

[Sirius]

Originally Posted by Osem

Just in case anyone thought this was all over:



http://www.telegraph.co.uk/finance/e...e-beckons.html

They will get it, the EU has no other option other than the financial collapse of Greece and all that entails for the EU gravy train.

Some posts moved.

Please remember that discussion of the referendum has its very own thread here:

http://www.cableforum.co.uk/board/20...eferendum.html

Another post moved.

PLEASE STOP POSTING ABOUT THE NEGOTIATIONS/REFERENDUM IN HERE.

The referendum has its own thread:

http://www.cableforum.co.uk/board/20...eferendum.html

[Osem]

Is the European project failing apart?

http://www.bbc.co.uk/news/world-europe-34940241

"We cannot," he said, "accommodate any more refugees in Europe, that's not possible.

"If we don't do that, the people will say, 'Enough of Europe.'"

Now who do you think said that? Nigel Farage or French Prime Minister Manuel Valls?

[Osem]

Are the Euro-worms turning?

Italy's Prime Minister Matteo Renzi openly attacked German policies at a European Union summit on Friday, criticising Berlin's stance on banking, energy, migration and Greece.

The litany of complaints, in comments to reporters in Brussels, was a sign of how the crises confronting the 28-nation EU have deepened tensions between its members.

Italy, a frontline state in the migration crisis, has become increasingly frustrated with the bloc's response. It is also critical of new rules to increase the euro zone's financial stability, another area where Germany has played a prominent role.

"Portraying Germany as a lifesaver for the European economy is not a shared view," Renzi told a news conference. He raised concerns about the sale to German airport operator Fraport of 14 Greek regional airports in the first big privatisation by the government of Prime Minister Alexis Tsipras.

Under pressure at home over the rescue of four small banks in which thousands of small Italian investors lost their savings, Renzi turned his fire on Germany's financial system with an unprecedented attack on its savings and cooperative banks.

http://uk.reuters.com/article/uk-eu-...0U126M20151218

There's a whole lot of resentment aimed at Germany for one reason or another...

[Osem]

Just in case anyone out there's still labouring under the impression that the EU is a nice worry free place to be:

The IMF has warned that Italy faces two decades of stagnant economic growth.
Its latest report on the country puts growth this year at under 1%, down from its previous 1.1% estimate, and forecasts growth in 2017 of about 1% - down from a 1.25% estimate.
The IMF says Italy will not reach pre-crisis levels until 2025, by which time its neighbours will have economies 20-25% above 2008 levels.
Italy is the third largest eurozone country.
It has 11% unemployment and a banking sector in crisis, with government debt second only to that of Greece.

http://www.bbc.co.uk/news/business-36770311

We're certainly not isolated from the fallout but better off as far out of the EU as possible I reckon. There's plenty more bad news on the way from that direction and we need to concentrate on developing trade elsewhere.

Italy's banks are the latest trouble spot for the eurozone.
They are struggling with a burden of bad debt, loans that are unlikely ever to be repaid fully.
They are a potential flashpoint in an economy that has for some time been seen as posing wider risks to the EU's currency area.
Meanwhile, the Italian government is considering a banking sector bailout which could breach European Union rules.
It's the size of the Italian economy and its government debt that makes the country a smouldering financial volcano. The risks are aggravated by the political situation.
It's the third-largest economy in the eurozone. The government debt burden, depending on which figures you look at, is certainly one of the largest in the eurozone, indeed the largest by one measure.

http://www.bbc.co.uk/news/business-36708357