Greece

[Shakespeare]

Greece opens a can of worms with its surprise referendum
So what happens if they vote "no", which appears very likely? Does Greece withdraw from the Euro, impose currency controls, and force conversion of in-country Euros to a drachma that will fall like a stone?

[AltaRed]

I guess it means more buying opportunities for those with cash. OTOH, it's been hard for a relatively recent retiree in withdrawal mode to catch a break. I wonder how many deterministic financial plans (as compared to a probablistic Monte Carlo simulation) contemplated the last 4 years.

[ghariton]

e-kathimerini:

Up to eight billion euros have been paid in bogus pensions in the past decade, director of the Social Security Foundation (IKA), Rovertos Spyropoulos said on Monday.

Under immense pressure to cut spending and replenish empty state coffers, the Greek government has found out that millions of euros have been paid to deceased claimants. The money is often claimed by fraudulent relatives or, in some cases, it remains idle in banks.

“We are trying to cut back on waste,” Spyropoulos told Skai television on Monday adding that the cutback has already saved the foundation over 700 million euros.

Yep. Austerity sure is painful.

George

[Peculiar_Investor]

I am sure glad they got this Greek debt problem resolved last week. Oops, Greek Vote Gamble Said to Stun Euro Partners - Bloomberg

Greece’s decision to call a referendum on its five-day-old bailout blindsided its European partners and placed another hurdle in the way of efforts to staunch the debt crisis.

<snip>

“If the Greek people don’t see the necessity of backing Papandreou we have a whole different ballgame,” Otto Fricke, the budget spokesman in parliament for Merkel’s Free Democratic Party coalition partner, said by phone. “If he doesn’t get a majority, then there’s no second aid package, no voluntary haircut. We’d have a potentially explosive situation, one that leaves us today baffled as to what we could possibly do next.”

After the markets close on Halloween is getting to be a scary time. Five years ago it the Canadian markets were blindsided. Greece upped the ante with their move, they might just have moved all-in!

[BRIAN5000]

Greece upped the ante with their move, they might just have moved all-in!

Unless you truely have the "NUTS" this is 'rarely/often not' a good move.

[George$]

Greece opens a can of worms with its surprise referendum
So what happens if they vote "no", which appears very likely? Does Greece withdraw from the Euro, impose currency controls, and force conversion of in-country Euros to a drachma that will fall like a stone?

I don't know what the outcome will be. And given this morning's market drop (2% in the first hour) it seems most everyone else is not sure either.

May be a good buying opportunity in the making.

[Shakespeare]

May be a good buying opportunity in the making

In the making maybe, but nowhere near good enough yet.

[kcowan]

May be a good buying opportunity in the making

In the making maybe, but nowhere near good enough yet.

Ironically, this was totally predictable. After all, we are taking about politicians!

I thought the Stratfor piece was very insightful:

You can redraw the flowchart now but the final outcome does not change!

Is anyone else sitting in a large amount of cash?

[newguy]

In the news today, 2 year yields are over 200% and there is an emergency meeting soon and the government is expected to fall.

newguy

[Shakespeare]

I suspect that they will have to drop out of the Euro because the political price internally is too high. Let the French look after the French banks.

[newguy]

It's possible that Greece's only way out is with a military government, as unpleasant as that is.

That's crazy talk.....Hmmm the 4 highest ranking military leaders just got fired.

newguy

[apater]

Over at the FT (courtesy of the G&M), Martin Wolf tells Germany to admit that there has been too much borrowing by the profligate because there was too much lending by the supposedly prudent.

[tedster]

I tried to "search" but found no thread. I can't believe no one has an opinion on the topic. What happens if the Greeks vote No? or Yes? Does the rest of Europe close the borders so Greeks cannot go into Europe to work? How fast can they dp this. Will everyone have to send in food like the marshall plan? There are Greek expats every where.

[Bylo Selhi]

I tried to "search" but found no thread. I can't believe no one has an opinion on the topic.

viewtopic.php?f=31&t=111919

Merged
Mod W

[ghariton]

I tried to "search" but found no thread. I can't believe no one has an opinion on the topic.

viewtopic.php?f=31&t=111919

Bylo just beat me to it.

What happens if the Greeks vote No? The country goes bankrupt, i.e. it defaults on its debt. (It will likely offer to pay in Drachmas, but that would be considered a default.) Likely it won't be able to pay many of its public sector employees, or pensioners, except in rapidly devaluating Drachmas. Then the real austerity starts.

Countries have gone bust before. Some of the more interesting precedents are Argentina in 2001 and Iceland in 2008 (dates are from memory). Argentina had pegged its currency to the U.S. dollar. With the peg gone, there was rapid devaluation and a lot of pain. My understanding is that the country still hasn't completely recovered.

Newspaper reports say that educated young Greeks have started lining up in front of foreign embassies, looking to emigrate. Australia is said to be a particular favourite.

George

Added: Oops, wrong thread. If a moderator wants to move it, I was answering tedster in Around the Watercooler.

Added some more: Forget it. The maid moved the furniture while I wasn't looking.

[Shakespeare]

The Greeks are going to default one way or the other; the debt levels aren't sustainable. Which also means the French and possibly German banks are going to have to be recapitalized or possibly nationalized.

[AltaRed]

What happens if the Greeks vote No? The country goes bankrupt, i.e. it defaults on its debt. (It will likely offer to pay in Drachmas, but that would be considered a default.) Likely it won't be able to pay many of its public sector employees, or pensioners, except in rapidly devaluating Drachmas. Then the real austerity starts.

I think that is what the Greek people do not really understand. They can riot and protest all they want but when they find they cannot be paid with useful money and they begin starving, they will have wished for the current austerity program.

[Shurville]

Prime Minister George Papandreou is expected to offer his resignation within the next half-hour, sources in Athens have told the BBC.

Mr Papandreou will meet Greek President Karolos Papoulias immediately after an emergency cabinet meeting has finished.

He is expected to offer a coalition government, with former Greek central banker Lucas Papademos at the helm.

Mr Papandreou himself would stand down, the BBC understands.

The Greek government was on the verge of collapse after several ministers said they did not support Mr Papandreou's plan for a referendum on the EU bailout

[Nemo2]

ISTM that Greece nowadays likely has more than double the population it had 'back when' I was first there, almost 50 years ago; then they were scraping by with fairly high unemployment, but with a pretty stable shipping/fishing industry.

Now they have ~twice as many people and an economy that probably hasn't improved...or perhaps deteriorated.

Too many people, and it's getting worse.

[Descartes]

Greek Prime Minister George Papandreou is backing off plans to hold a controversial referendum on an international bailout for his country, he told his Cabinet Thursday, saying there was no need for it given opposition support for the tough austerity measures that accompany it.

Papandreou's office is now denying earlier statements that he was going to meet the president of the country, news which sparked speculation about a possible resignation.

Choose one of the following to complete this sentence:
"Prime Minister Papandreou is..."

[a] desperately trying to save face

[b] a cunning master of brinkmanship

[c] to be sealed permanently in a wooden horse with the rest of those crazy irresponsible Greeks, in a perfect world


http://www.cnn.com/2011/11/03/world/eur ... ?hpt=hp_t1

[Shurville]

Time for the COUP? Remember that Ghadafi was a lieutenant not a general when he led the coup in Libya.

[Peculiar_Investor]

Choose one of the following to complete this sentence:
"Prime Minister Papandreou is..."

Before your post I read Papandreou will fall but he is right to take this gamble - FT.com this morning and it made sense to me.

Mr Papandreou was left with three options. The first was slow death: persist on his current path of political paralysis, dwindling popularity, and collapsing governing capacity. The second was immediate death: call for early elections that, all surveys indicate, would have resulted in an unprecedented rout for his party. The third was gambling for resurrection: call for a referendum that would give his government a new lease on life and salvage his political career. Seen from this perspective, his decision does make political sense.

[blonde]

Study the System.

Do not be surprised to learn that the dickering will continue until Pap-&-reau gets to satisfy his WIIIFM-Factor and G/F-Factor, 100%.

How do ya'lls think the accounts are settled in areas like Iraq, Afghanistan, Egypt, Libya, QC, SK...just to list the obvious thingies.

Money Talks, Big-Time.

That is HOW the Worm-Turns, Folks!!!

In the meantime...most taxpayers LUV-IT.

WHY are so many taxpayers so darn Stupid?

[ghariton]

Thought of the day:

Italy is borrowing at 6.4% to lend to Greece at 3.5%.

George

[ghariton]

Telegraph:

Jubilation about the German deal to save the euro could prove short-lived if fresh news of Greek tax evasion gains wider currency. There are more Porsche Cayennes registered in Greece than taxpayers declaring an income of 50,000 euros (£43,800) or more, according to research by Professor Herakles Polemarchakis, former head of the Greek prime minister’s economic department.

While German car workers may take pride in this evidence of their export success, German taxpayers may be less keen to bail out a nation whose population appears to take such a cavalier approach to paying its fiscal dues. Never mind all that macroeconomic talk about deficit distress, many Greeks are still plainly riding high on the hog.

Something can’t be right when the modest city of Larissa, capital of the agricultural region of Thessaly with 250,000 inhabitants, has more Porsches per head of the population than New York or London.

Many people have expressed their indignation at the greed of Wall Street bankers. But it seems that greed is more widespread than Wall Street.

George