Syriza wins Greece election

[BabelHuber]

So back in 2013 Krugman was saying that a German surplus was creating a deflationary bias within the Eurozone, eh? Wonder if he was wrong or not;

I'd say the deflationary tencencies originate from the weakness of the southern European economies, not from Germany's strength.

Like Krugman, you act as if the successfull European economies are at fault for the situation. In my opinion, the southern European economies and France failed to adapt to the Euro, and they also failed to adjust to the world economy we have today, with the raise of the BRIC-states etc.

When I look at countries like Italy or France, I don't see much reforms they have taken since the cold war ended. No wonder that their economies are not fit for the competitive situation we have today.

But of course it is much easier to blame the successful countries.

There isn't, 80% of the money 'floated into Greece' floated its way straight out to the banks! Did it escape your notice that the 'myth' of austerity has caused a shrinkage of 25% of Greece's GDP which was completely avoidable?

Again you do not address the point:

Greece could only reach its "growth" by lending more money than it could stomach in the long run prior to 2010. Of course this is not sustainable in the long run, at some point this house of cards has to fall.

And this is exactly what has happened in Greece. The Greek economy now adjusts to realistic levels.

So no, the shrinking of the Greek economy was not "avoidable"! Sooner or later it had to crash down!

You cannot infinitely subsidize an economy from abroad, it has to stand on its own feet. Which brings me back to the point I made earlier:

A state can only "earn" money by taxing its companies and the people who work for them. Everything else is voodoo magic bullshit which is not sustainable. And this has been proven nicely by Greece.

And of course the money floated to the banks - this is money Greece already has already spent in the past after all! Do you think Greece gets the same money a second time? This is retarded.

Did it escape your notice that Greece is suffering a depression that has now outlasted the Great Depression? Do you remember how the Great Depression was made worse and how it was made better?

I hope you do know that the main factor which led to the Great Depression was the bancrupty of the banks. This dried the economy of money, which led to the collapse in 1929.

This you cannot even compare to Greece - they have no economy to speak of, and this is exactly the problem. If it would have been a similar situation, the rescue of the banks would have rescued the Greek economy.

It does and it is. They can dress it anyway they want; growth package, stimulus package, hair cut, payment restructuring, etc.

And the voters of the Northern European countries would vote for politicans who make such suggestions? Dream on!

How the FUCK does your internal logic work? You say that Greece having the Euro and the others not having it 'doesn't count' and then claim that Greece having the Euro means 'they have to deal with it'? You're internally self-contradictory. The only way that Greece can compete with these nations is by drastically slashing wages, which it did. But that is still not enough if its unemployment continues to grow. Hey, I've seen this scenario before; unemployment rising coupled with falling wages, wanna guess when?

Greece has an overboarding bureacracy which is a huge hindrance to investions. And no, Greece has not taken the necessary steps yet to fix this. Cutting wages alone is not enough.

And of course having the Euro is no excuse for not attracting investors - as I already have stated, if Greece thinks the Euro is a handicap they can leave the currency. If they want to keep it, they have to deal with it. I don't see any contradictions here.

Right so a possible 700 people committing fraud on an island of 40,000 is, and I quote; "islands where almost everybody was officially blind"

OK, so I had the numbers wrong in mind (yes, I should have looked them up before posting).

But I hope you don't think that fraud and Fakelaki is no problem at all in Greece.

And you've been told, time and time again that this is simply because Iceland allowed its banks to fail while Greek banks (along with French and German banks) weren't since Greece was 'rescued' by the Troika buy increasing it's debt with a 'bailout'.

You do not get the difference between a bank getting bancrupt and a state getting bancrupt. Fine, this is enough information for me.

I'll bring it up every time you try and make this as some kind of moral argument; i.e. 'they deserve it', 'they're thieves', 'they're lazy', 'they're fraudsters' etc

The Greek economy got what it deserved. Of course the effects for the people are bad, but the standard of living was not sustainable anyways - as soon as the flow of foreign money stops, it's over. And this point has to come sooner or later.

You can only drag it out, so that the collapse occurs later. The collapse itself was unavoidable.

No I'm saying that the periphery countries should tell Germany; we're happy you're doing well but we're drowning here. Our unemployment is over 20% (with youth at around 50%) and we would really like an end to what is made up austerity bullshit which has extended a recession beyond a time frame of the Great Depression. If the creditors want to insist on reforms (crack down on tax evasion, corruption, etc) fine, but you cannot continue to contract an economy year after year and claim 'working as intended'.

You still haven't explained how your voodoo economy bullshit can work:

The crisis in the PIIGS states was caused by cheap money flowing into these countries, with all side effects like housing bubbles etc.

If you keep the money flowing, you do not fix jack shit. You just shift the inevitable collapse into the future.

Because while the core economies (and their citizens) will find it unpalatable, the periphery will revolt. As it did in Greece; be thankful (as am I) that they voted for the left and not the right.

This does not change the fact that Greek's economy cannot live from free foreign money in the long run.

I'm not going to claim that Greece between early 1980s to late 1990s was a shining example of a vibrant economy, but only a blind ideologue with an axe to grind can completely ignore what happened post Euro entry and not see a connection between the introduction of the single currency and absurdly cheap credit to what eventually transpired. However just because this happened doesn't mean we should continue with a policy which is so obviously discredited by every measurable index known to economists. When the goddamned IMF goes 'oops, we fucked up' it's time to re-asses.

Yes, it is better to do the same thing than 10-15 years ago, which brought us into this situation in the first place. Brilliant.

[Thanas]

BTW, so much for Greece's word:

Just a few days after vowing Greece would not take unilateral actions, Tsipras announced just that.

And this is interesting about the negotiations:

In his first appearance before his foreign counterparts, Greek Finance Minister Giannis Varoufakis initially triggered astonishment, which then gave way to mild annoyance and finally culminated in rage and indignation.

Varoufakis, a professor of economics, used his visit to the special summit of the Euro Group -- which consists of euro-zone member state finance ministers -- last Wednesday in Brussels to give a lecture. He spent half an hour talking about his view of the crisis and the "humanitarian catastrophe" in his country. But a concept for how he intends to tackle Greece's gigantic debt load was not part of his presentation.

The response to his speech was unsurprising, with representatives of smaller countries, in particular, expressing their rage over the audacity of the newly elected Greek government's demand to renegotiate aid from its partner countries. "Your standard of living is higher than ours, and we pay for your aid," the finance minister of one of the Baltic countries said angrily, while his counterpart from Slovenia described the event as "a total waste of time." "I can't take that to my parliament," the Estonian envoy complained.

European Central Bank (ECB) President Mario Draghi was especially irate. "We can do nothing at all if you talk like that," he said. If all you do is "constantly talk about insolvency," he added, "even the healthy Greek banks will eventually be insolvent."

Ultimately, Euro Group President Jeroen Dijsselbloem proposed writing a joint statement for last Thursday's summit of EU leaders. An intense wrangling over the wording of the statement began, with Varoufakis fighting over every comma. "We are not at a Turkish bazaar here," the Slovakian finance minister said testily.

[K. A. Pital]

Once again: Greece is a sovereign country and it can do anything it wants. That is the surprising part of being a sovereign country.

Prohibiting collective agreements is nonsense aimed at creating downward pressure on wages, so of course it is good this bullshit was done away with. There is enough downward pressure on wages as it is. Collective bargaining is a fundamental workers' right. It makes one shudder to think that destroying this right could be a 'demand' from another country.

That is why separate currencies are so good. If you don't like the worker rights, you do not invest in a country that protects the rights of workers. In this case the country is free to maintain its workers' rights, although it will likely face capital outflows. But in the current situation other countries are demanding rightist anti-union measures as part of the 'deal'.

[Thanas]

Once again: Greece is a sovereign country and it can do anything it wants. That is the surprising part of being a sovereign country.

It can, but it can then also not complain about being not trusted if it does things that are not trustworthy.

EDIT: To put it more bluntly, if I go up to you and say "please give us money I promise not to do anything in the meantime" and then go and do the exact opposite, you are well within your rights to tell me to go fuck myself.

Let me just stop there for a second - Greece gets 2.9% of its GDP from the EU. That is more than they pay for Interest on all their debt (see below).

Guess what? You're wrong again. It's like you have a learning disability. Literally.
You still haven't learned that others will check your numbers to see if they add up.

The number comes from a highly respected Thinktank using the official ECB numbers. I'll take their word (and Guardians and Spiegels) over yours and that of the Greeks anyday. You are welcome to look at the ECB numbers and then prove how they are wrong. Either the two sides uses vastly different methodology, the Greeks are lying or there is a massive shadowy conspiracy afoot to crush Greece. The last one is unlikely.

[K. A. Pital]

To put it more bluntly, if I go up to you and say "please give us money I promise not to do anything in the meantime" and then go and do the exact opposite, you are well within your rights to tell me to go fuck myself.

Of course you can do that. I am sure that the EU could simply expunge Greece if not for a lack of a mechanism to do so. Then again, if the EU would start doing that (letting countries into a currency union, watching them go bankrupt and then kicking them out), I am pretty sure it is bound to experience some problems with membership.

[Thanas]

To put it more bluntly, if I go up to you and say "please give us money I promise not to do anything in the meantime" and then go and do the exact opposite, you are well within your rights to tell me to go fuck myself.

Of course you can do that. I am sure that the EU could simply expunge Greece if not for a lack of a mechanism to do so. Then again, if the EU would start doing that (letting countries into a currency union, watching them go bankrupt and then kicking them out), I am pretty sure it is bound to experience some problems with membership.

We don't need a mechanism to kick them out. We can simply refuse to fund them. That will force them to evacuate the Eurozone.

[Crown]

I'd say the deflationary tencencies originate from the weakness of the southern European economies, not from Germany's strength.

And I’d say that Krugman made a prediction that turned out to be correct, which is the primary point we’re discussing.

Like Krugman, you act as if the successfull European economies are at fault for the situation. In my opinion, the southern European economies and France failed to adapt to the Euro, and they also failed to adjust to the world economy we have today, with the raise of the BRIC-states etc.

When I look at countries like Italy or France, I don't see much reforms they have taken since the cold war ended. No wonder that their economies are not fit for the competitive situation we have today.

But of course it is much easier to blame the successful countries.

Your ability to conflate multiple issues is truly remarkable; did southern Eurozone (EZ for short) countries ‘fail to reform/conform’? Sure. Does that mean that Germany’s policies are somehow helping their situation? No. You have this fucking hard on with assigning blame, but can’t seem to realise that even if I concede on every one of your points regarding structural reform while inside the EZ prior to the Global Financial Crisis (GFC), the prescription of austerity has been disastrous for the periphery. That’s the point; a completely made up neoliberal wonky economic theory designed to attack, gut and fleece the middle class and the poor while protecting the rich from any of their risk exposure.

Again you do not address the point:

Greece could only reach its "growth" by lending more money than it could stomach in the long run prior to 2010. Of course this is not sustainable in the long run, at some point this house of cards has to fall. And this is exactly what has happened in Greece. The Greek economy now adjusts to realistic levels. So no, the shrinking of the Greek economy was not "avoidable"! Sooner or later it had to crash down! You cannot infinitely subsidize an economy from abroad, it has to stand on its own feet. Which brings me back to the point I made earlier: A state can only "earn" money by taxing its companies and the people who work for them. Everything else is voodoo magic bullshit which is not sustainable. And this has been proven nicely by Greece.

Jesus tittyfucking Christ; how many times do I have agree that Greece’s economy was toxic pre GFC? That’s never been in contention; the point for the umpteenth time is that the prescribed economic policies have been nothing short of a catastrophe. They were questioned by the IMF before they were implemented, while they were implemented and even repudiated after the fact. How much more of evidence do you need to ignore before you concede?

I hope you do know that the main factor which led to the Great Depression was the bancrupty of the banks. This dried the economy of money, which led to the collapse in 1929. This you cannot even compare to Greece - they have no economy to speak of, and this is exactly the problem. If it would have been a similar situation, the rescue of the banks would have rescued the Greek economy.

EVERY indicator in the Great Depression is being replicated in Greece. Unemployment to 25% and higher, wages nose diving, prices falling and insolvent banks (which is what Greek banks are). The only thing that’s different (well apart from Greece not being in charge of it’s own currency) is that it has now lasted longer than the Great Depression … yay Austerity … ?

And the voters of the Northern European countries would vote for politicans who make such suggestions? Dream on!

Pretty sure there are no ‘pro-Austerity’ rallies anywhere in the fucking world. Sure the average German would find it unpalatable to the point of feeling fleeced by Greece (and the other Southern EZ countries), but then again the average German has been well conditioned to believe that there are islands in Greece where the entire population is engaged in mass benefits fraud by claiming blindness (sound familiar). The propaganda has been well done.

Greece has an overboarding bureacracy which is a huge hindrance to investions. And no, Greece has not taken the necessary steps yet to fix this. Cutting wages alone is not enough.

And of course having the Euro is no excuse for not attracting investors - as I already have stated, if Greece thinks the Euro is a handicap they can leave the currency. If they want to keep it, they have to deal with it. I don't see any contradictions here.

I can’t, I honestly can’t begin to fathom how fucking retarded you are. Pre crisis the Euro was buying 3.6 Polish Zloty in 2002, just to make it easy, lets assume that stays relatively stable through out. With all things being equal (work with me here); the only way Greece could compete with Poland as a place for investment for German auto-manufacturers (read a good place to offload some work) would be either to massively repress worker’s pay or to offer a neoliberal corporate tax rate that would be their wet dream, and hope that Poland doesn’t do that anyway. That’s my point when I say you simply cannot compare the struggle that the southern EZ countries faced in ‘becoming competitive’ to EU nations outside of the EZ.

The Euro simply made it a hindrance. Even when a Greek persons wage in the private sector was 70% to that of a German, they still could not ‘compete’ with EU nations without the Euro.

You do not get the difference between a bank getting bancrupt and a state getting bancrupt. Fine, this is enough information for me.

And as you have been told time and time again Sovereign Default is not something magical and new either. The only thing unique in this is that Greece was tied in the Euro.

You still haven't explained how your voodoo economy bullshit can work:

The crisis in the PIIGS states was caused by cheap money flowing into these countries, with all side effects like housing bubbles etc.

If you keep the money flowing, you do not fix jack shit. You just shift the inevitable collapse into the future.

Not sure if serious…

You understand that I’m not suggesting that the EZ just throw at the money and pretend there’s no problem right? You understand my argument is that to fight a recession depression you have to follow a policy of spending while introducing reforms. Introducing reforms while cutting all spending across the board all you’re going to achieve is a prolonging of the suffering. The point is to be ‘fiscally conservative’ while the economy is growing, and ‘stimulating growth’ when it’s contracting. Austerity does the exact opposite of this. It depends on the magical confidence fairy to fly in and fix everything.

This does not change the fact that Greek's economy cannot live from free foreign money in the long run. Yes, it is better to do the same thing than 10-15 years ago, which brought us into this situation in the first place. Brilliant.

These both seem to be a continuation of your meme that I’m against reforming the southern/periphery/Greek economy/political system. I’m not. I’m saying doing this while gutting it at the same time, is going to be a bad fucking policy. And given the way the predictions of austerity have been completely shown to be bullshit, I’m struggling to find how anyone could possibly take the opposing view.

[J]

The number comes from a highly respected Thinktank using the official ECB numbers. I'll take their word (and Guardians and Spiegels) over yours and that of the Greeks anyday. You are welcome to look at the ECB numbers and then prove how they are wrong. Either the two sides uses vastly different methodology, the Greeks are lying or there is a massive shadowy conspiracy afoot to crush Greece. The last one is unlikely.

A highly respected thinktank, allegedly using the ECB numbers. Perhaps you can find it for me on the official ECB site, since I don't see a listing for current balance transfers to Greece.
http://sdw.ecb.europa.eu/home.do

[Crown]

BTW, so much for Greece's word:

Just a few days after vowing Greece would not take unilateral actions, Tsipras announced just that.

They're also giving the Financial Crime Squad more powers, closing down Migrant centres, changing migrant laws for children born in Greece and they're also thinking about making Private Health Insurers pay for health care costs ... those dastardly Trotskyites, burn them with fire!

And this is interesting about the negotiations:

Actually here's something more interesting about the negotiations; the draft offered to Greece which Varoufakis was ready to sign, and the final version presented on the night without warning of any changes. Things that make you go hmmm.

[Crown]

Oh, and quite possibly my favourite quote of today goes to Herr Schäuble;

Asked a question in English at the end of the press conference, Schaeuble said this was still a German press conference and appeared to add a little dig at George Osborne, the finance minister of a non-euro member, but vocal on Greece nonetheless.

“I hope George Osborne will deliver some press conference and he is the most engaged mitglied [member] of the eurogroup.”

I kinda like a little more now.

[BabelHuber]

I can’t, I honestly can’t begin to fathom how fucking retarded you are. Pre crisis the Euro was buying 3.6 Polish Zloty in 2002, just to make it easy, lets assume that stays relatively stable through out. With all things being equal (work with me here); the only way Greece could compete with Poland as a place for investment for German auto-manufacturers (read a good place to offload some work) would be either to massively repress worker’s pay or to offer a neoliberal corporate tax rate that would be their wet dream, and hope that Poland doesn’t do that anyway. That’s my point when I say you simply cannot compare the struggle that the southern EZ countries faced in ‘becoming competitive’ to EU nations outside of the EZ.

The Greek bureaucrazy with all its inefficience and Fakelaki-practices would have prevented serious investment for German auto makers anyways, no matter the currency.

Further, a big advantage of Poland and the Czech Republic are their work ethics: Their workers are well respected as motivated and efficient. And they don't strike often.

If Greece could compete in these areas, we could begin a discussion about the advantages and disadvantages of the Euro for Greece.

But simply claiming that the Euro is at fault for Greek's weakness is retarded. On top of it, Greece wanted to enter the Euro-zone.

You understand that I’m not suggesting that the EZ just throw at the money and pretend there’s no problem right? You understand my argument is that to fight a recession depression you have to follow a policy of spending while introducing reforms. Introducing reforms while cutting all spending across the board all you’re going to achieve is a prolonging of the suffering. The point is to be ‘fiscally conservative’ while the economy is growing, and ‘stimulating growth’ when it’s contracting. Austerity does the exact opposite of this. It depends on the magical confidence fairy to fly in and fix everything.

Now this is really the point where we totally disagree.

There has been af huge flow of money into the PIIGS-states after the Millenium. But this money merely created a straw fire - as soon as the flow shrinks, the growth is over.

So again trying to flood these economies with money most likely will deliver the same result - a mere bubble that inevitably will crash.

Note that again you quote Keyne's theory, and as I already have stated, you cannot generate sustainable growth with this approach in an open economy: A good part of the money you pump into the economy will be spent abroad by importing products!

Keynes theory fucking includes investing in production facilities - this is one result of flooding the economy with money.

But this won't happen in the EU of today: If you fund infrastructure projects, you still create growth. But this growth is fueled by real estate bubbles and imports from abroad. Or do you honestly believe that Greece would suddenly start to build cars, smartphones and TVs with your concept?

Fucking no, they still would not be able to compete on the world market! They would again import this stuff, consuming the "new" money this way. This is rather a concept to boost Germany and China.

The second point is political in nature: While you are right that it would be the best to reform an economy while it grows, real-world evidence shows up that this is rarely undertaken.

In a growth phase, the government usually is popular and hence has a good chance to win the next elections. Why reforming, then?

So if you'd flood the market with money, reforms tend to stop.

And again the third point is that it would be political suicide for Northern European politicians to cater to the Greek government, at least as long as the Greek government behaves this way.

[Thanas]

They're also giving the Financial Crime Squad more powers, closing down Migrant centres, changing migrant laws for children born in Greece and they're also thinking about making Private Health Insurers pay for health care costs ... those dastardly Trotskyites, burn them with fire!

These are all good things (well, except closing Migrant centres and the laws of children, of which I am uninformed about and cannot say much). But the point is still - the president of Greece publicly promised not to move unilaterally. He then broke that promise less than two days later. How can you trust somebody like that?

[K. A. Pital]

To put it more bluntly, if I go up to you and say "please give us money I promise not to do anything in the meantime" and then go and do the exact opposite, you are well within your rights to tell me to go fuck myself.

Of course you can do that. I am sure that the EU could simply expunge Greece if not for a lack of a mechanism to do so. Then again, if the EU would start doing that (letting countries into a currency union, watching them go bankrupt and then kicking them out), I am pretty sure it is bound to experience some problems with membership.

We don't need a mechanism to kick them out. We can simply refuse to fund them. That will force them to evacuate the Eurozone.

Please do so - show everyone that there's not just a way in, but also a way out, but not until you are in complete economic ruin.

And they don't strike often.

How dare they strike! They must submit. Then the good capitalist will give money to the good slave, just like God did in the story of the three slaves and the talent!

[Thanas]

There is a way out for everybody to voluntarily leave at any point, you know.

[Tribble]

There is a way out for everybody to voluntarily leave at any point, you know.

Article 50 of the Lisbon Treaty to be specific.

The question isn't really if Greece will leave, but rather when. Which do you think is more preferable: compel Greece to leave now, or kick the can down the road again by a couple of years?

[Thanas]

The question isn't really if Greece will leave, but rather when. Which do you think is more preferable: compel Greece to leave now, or kick the can down the road again by a couple of years?

I'd prefer they not leave at all.

[Purple]

The question isn't really if Greece will leave, but rather when. Which do you think is more preferable: compel Greece to leave now, or kick the can down the road again by a couple of years?

I'd prefer they not leave at all.

Given the way you are willing to destroy them as "punishment" for their economic choices I do not think that is in Greece's best interest. That is why he asked you what he did.

[Tribble]

The question isn't really if Greece will leave, but rather when. Which do you think is more preferable: compel Greece to leave now, or kick the can down the road again by a couple of years?

I'd prefer they not leave at all.

Sure, but it's very unlikely that's going to happen. Keeping Greece in the Eurozone isn't working, and I doubt that the Greeks will keep to any agreement that is made for very long... assuming that an agreement is reached, of course. Nor do I see this being a perpetual cycle - in all likelihood Greece will end up leaving the Euro eventually. The only real question is whether or not if it is better for everyone involved if Greece left now as opposed to a few more years down the road. Which do you think is the better option?

[bobalot]

Let's face reality. This isn't really about Greece's debts.

If Greece gets to default and renegotiate its loans and recovers like Iceland, Argentina and Russia did after their defaults then Spain, Portugal and Italy will follow suit.

That's what the plutocratic elite running the failed political experiment EU are really afraid of.

The EU/Troika/Germany are demanding another 4-5 years of near social and economic collapse for Greece and they are honestly wondering why Syriza won't bow to their demands. It's hilarious watching this from the outside.

BTW, for those circlejerking about how Greece isn't "reforming" fast enough (i.e. destroying their social safety net and worker rights) it turns out that the OECD have rated the rate of economic reform and found that Greece leads the pack.

[img*]http://blogs-images.forbes.com/stevekee ... ge0011.png[/img]
Source

The reality is that austerity has been a complete failure and the EU/Troika/Germany are making up excuses for why their shitty economic policies have been a complete failure for 5 years.

Austerity cannot fail. It can only be failed.

[Thanas]

Given the way you are willing to destroy them as "punishment" for their economic choices I do not think that is in Greece's best interest. That is why he asked you what he did.

I hardly think writing off large portions of the debt and transferring large sums of money every year is destroying a nation. And the Greeks clearly feel it is in their best interest to continue within the EU.

[Thanas]

Breaking news:

Greece has agreed to an extension and agreed to follow the program in its current form.

GREEK REQUEST FOR BAILOUT EXTENSION SAYS ATHENS WILL HONOUR ITS FINANCIAL OBLIGATIONS TO ALL CREDITORS

GREECE RECOGNISES EXISTING BAILOUT AGREEMENT AS BINDING IN ITS FINANCIAL AND PROCEDURAL CONTENT

GREECE SAYS IT WILL PROCEED JOINTLY WITH EURO ZONE OVER NEXT 6 MONTHS TO SUCCESSFULLY CONCLUDE THE BAILOUT ON THE BASIS OF TROIKA, GREEK GOVT PROPOSALS

GREEK BAILOUT EXTENSION REQUEST SAYS NEXT 6 MONTHS WOULD BE USED TO AGREE ON “APPROPRIATE” PRIMARY FISCAL SURPLUSES

GREECE SAYS WILL REFRAIN FROM UNILATERAL ACTION THAT WOULD UNDERMINE FISCAL TARGETS, ECON RECOVERY AND FIN STABILITY

GREECE SAYS BAILOUT EXTENSION WOULD BE MONITORED BY THE TROIKA

GREECE SAYS IT WILL PROCEED JOINTLY WITH EURO ZONE OVER NEXT 6 MONTHS TO SUCCESSFULLY CONCLUDE THE BAILOUT ON THE BASIS OF TROIKA, GREEK GOVT PROPOSALS

GREEK BAILOUT EXTENSION REQUEST SAYS NEXT 6 MONTHS WOULD BE USED TO AGREE ON “APPROPRIATE” PRIMARY FISCAL SURPLUSES

GREECE SAYS WILL REFRAIN FROM UNILATERAL ACTION THAT WOULD UNDERMINE FISCAL TARGETS, ECON RECOVERY AND FIN STABILITY

So, austerity stays, Troika stays, no change to the bailout terms unless agreed on by all Eurogroup members.


And a note by Varoufakis:

Dear President of the eurogroup,

Over the last five years, the people of Greece have exerted remarkable efforts in economic adjustment. The new government is committed to a broader and deeper reform process aimed at durably improving growth and employment prospects, achieving debt sustainability and financial stability, enhancing social fairness and mitigating the significant social cost of the ongoing crisis.

The Greek authorities recognise that the procedures agreed by the previous governments were interrupted by the recent presidential and general elections and that, as a result, several of the technical arrangements have been invalidated. The Greek authorities honour Greece’s financial obligations to all its creditors as well as state our intention to cooperate with our partners in order to avert technical impediments in the context of the Master Facility Agreement which we recognise as binding vis-a-vis its financial and procedural content.

In this context, the Greek authorities are now applying for the extension of the Master Financial Assistance Facility Agreement for a period of six months from its termination during which period we shall proceed jointly, and making best use of given flexibility in the current arrangement, toward its successful conclusion and review on the basis of the proposals of, on the one hand, the Greek government and, on the other, the institutions.

The purpose of the requested six-month extension of the Agreement’s duration is:

(a) To agree the mutually acceptable financial and administrative terms the implementation of which, in collaboration with the institutions, will stabilise Greece’s fiscal position, attain appropriate primary fiscal surpluses, guarantee debt stability and assist in the attainment of fiscal targets for 2015 that take into account the present economic situation.

(b) To ensure, working closely with our European and international partners, that any new measures be fully funded while refraining from unilateral action that would undermine the fiscal targets, economic recovery and financial stability.

(c) To allow the European Central Bank to re-introduce the waiver in accordance with its procedures and regulations.

(d) To extend the availability of the EFSF bonds held by the HFSF for the duration of the Agreement.

(e) To commence work between the technical teams on a possible new Contract for Recovery and Growth that the Greek authorities envisage between Greece, Europe and the International Monetary Fund which could follow the current Agreement.

(f) To agree on supervision under the EU and ECB framework and, in the same spirit, with the International Monetary Fund for the duration of the extended Agreement.

(g) To discuss means of enacting the November 2012 Eurogroup decision regarding possible further debt measures and assistance for implementation after the completion of the extended Agreement and as part of the follow-up Contract.

With the above in mind, the Greek government expresses its determination to cooperate closely with the European Union’s institutions and with the International Monetary Fund in order: (a) to attain fiscal and financial stability and (b) to enable the Greek government to introduce the substantive, far-reaching reforms that are needed to restore the living standards of millions of Greek citizens through sustainable economic growth, gainful employment and social cohesion.

Sincerely,

Yanis Varoufakis
Minister of Finance
Hellenic Republic

Or in other words, looks like Greece has folded in all but name - for now. It remains to be seen what the next six months bring.

My guess is that if Syriza show themselves to be serious with reforms they will have a much easier time in six months to get better positions - and they should.

[J]

And rejected!

http://www.bloomberg.com/news/articles/ ... e-i6c3go5j

(Bloomberg) -- Germany rejected Greece’s request for an extension of its aid program, saying its offer doesn’t meet the euro region’s conditions for continuing aid.

The Greek government is trying to agree bridge-financing without meeting the conditions of its existing rescue program, German Finance Ministry Spokesman Martin Jaeger said in an e-mailed statement. European Commission Spokesman Margaritis Schinas moments earlier had said the Greek letter could be the basis for a “reasonable compromise.”

The euro dropped 0.3 percent to $1.1358.

With the Greek state and its banks shut out of financial markets and dependent on emergency aid to stay afloat, Prime Minister Alexis Tsipras is retreating from his pledges to end austerity as the country’s creditors tighten the financial vise.

Tsipras’s government in a letter to fellow euro member states offered to work for the “successful conclusion and review” of the current financing agreement with creditors in a bid to avert a cash crunch.

Euro-region finance ministers will make a “detailed assessment” of the request and formulate a response, Schinas said at a press conference in Brussels Thursday. Ministers are due to meet on Friday.

During the extension “we shall proceed jointly, and making best use of given flexibility in the current arrangement, toward its successful conclusion and review on the basis of the proposals of, on the one hand, the Greek government and, on the other, the institutions,” Finance Minister Yanis Varoufakis said in the letter.

Varoufakis said the extension will allow Greece to agree on supervision by the European Union, the European Central Bank and the International Monetary Fund and discuss a new contract.

[Thanas]

Yeah, apparently the actual proposal was a bit different than what they leaked.

[Tribble]

Thanas you seem to be repeatedly ignoring my question, which I have now asked multiple times. You earlier conceded that it is highly likely that should Syriza eventually cave in the Greeks will eventually vote for parties like Golden Dawn next, which will almost certainly lead to a Greek exit. In other words, a Greek exit will happen, the only real question is when. Once again, which do you think is preferable?

[Thanas]

Thanas you seem to be repeatedly ignoring my question, which I have now asked multiple times. You earlier conceded that it is highly likely that should Syriza eventually cave in the Greeks will vote for parties like Golden Dawn next in order to leave. In other words, a Greek exit will happen, the only real question is when. Once again, which do you think is preferable?

I am not ignoring it, I have answered it. I reject your premise that a Grexit is inevitable as Greeks do not believe in it. I believe if the question really is put to them, they will vote in favor of remaining in the EU. But if they vote in favour of an exit, the timetable does not really matter as people have been preparing for that for several years now.