Greece Watch...

[Lord Beria3]

http://www.marketoracle.co.uk/Article34625.html

Interesting perspective on a potential euro cascade collapse...

[Aurora]

http://www.marketoracle.co.uk/Article34625.html

Interesting perspective on a potential euro cascade collapse...

Whilst contagion amongst euro-zone members may be a slow motion affair as countries one by one line up for exit, however the contagion amongst the banking sector will be immediate and europe wide as credit markets freeze, that has the potential to accelerate the collapse of the euro-zone as the potential bailout costs for preventing financial armageddon soar far beyond the means of any of the euro-zone member states to cover.

It'll only take another couple of toxic CDS disclosures to bring down the whole, sordid, pack of cards.

[Aurora]

The Guardian - 13/05/12

Last-ditch discussions hope to produce some form of coalition as country remains leaderless after deadlocked elections.

Article continues ...

Cash-strapped Athens has enough money to survive financially until the end of June after which it will be unable to cover the pay and pension packages of public sector employees.

[Lord Beria3]

http://www.marketoracle.co.uk/Article34625.html

Interesting perspective on a potential euro cascade collapse...

Whilst contagion amongst euro-zone members may be a slow motion affair as countries one by one line up for exit, however the contagion amongst the banking sector will be immediate and europe wide as credit markets freeze, that has the potential to accelerate the collapse of the euro-zone as the potential bailout costs for preventing financial armageddon soar far beyond the means of any of the euro-zone member states to cover.

It'll only take another couple of toxic CDS disclosures to bring down the whole, sordid, pack of cards.

+1

The whole financial system is totally sick. Just read the 'Big Short' on the subprime mortgage fraud which nearly brought down the financial system in 2008 - the whole system is f***ed.

Its interesting that having googled the few people who saw how the system was going to collapse during the boom years are now betting on a spectatular collapse on in the global government bond markets in the coming years and are buying up physical assets like farmland and gold in anticipation of the coming hyperinflationary/financial collapse storm.

[JavaScriptDonkey]

Really?

I didn't know Cleveland was that big.

[Aurora]

The Guardian - 13/05/12

Greek coalition hopes dashed as leftist leader stands firm

Alexis Tsipras says he will not be 'partner in crime' with mainstream leaders, who criticise his stance as irresponsible.

Article continues ...

So what happens next?

[Aurora]

The Observer - 13/05/12

How Greece could leave the eurozone – in five difficult steps

Two years ago, the prospect of a state falling out of the single currency area was unthinkable. But as the Greek electorate turns against austerity, it is becoming all too easy to picture how breakup might happen.

Article continues ...

[Aurora]

BBC News Magazine - 13/05/12

Is it cheaper to put Greek train passengers in taxis?

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No wonder they're in the $h1t!

[Aurora]

BBC News - 14/05/12

Far left Syriza pulls out of talks

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[adam2]

BBC News Magazine - 13/05/12

Is it cheaper to put Greek train passengers in taxis?

Article continues ...

No wonder they're in the $h1t!

The same is said to be true of some lightly used branch lines in the UK !

It must be said though, that Greek railways have very considerable debts and that the repayment of these is a substantial expense, which is included in the costs per KM per passenger.
If one closed down the railway and sent passengers by road instead, then the railway debts would still have to be paid IN ADDITION to the costs of road transport, and the total expense would be greater than continued use of the railway.

[Aurora]

The Guardian - 14/05/12

Eurozone crisis live: Markets slide as Greek euro exit looms

Chances of Greece leaving the eurozone are growing, as political leaders prepare for last-ditch coalition talks in Athens
• FTSE 100 falls 110 points
• Spanish and Italian bond yields rise
• Fears of civil disorder...
• ....or Greece running out of money in June
• Today's agenda

Article continues ...

[UndercoverElephant]

Well...it has seemed inevitable for the last 18 months.

There is still the potential for more twists in the tail, though. The anti-austerity Greek parties are not actually advocating a return to the Drachma, and there's no mechanism for expelling a country from the eurozone. Greece can leave (because nobody could stop them), but what happens if they decide not to, but refuse to implement the austerity program? We must suppose that further payments from the troika will stop, and Greece will default but will remain in the eurozone. Nobody seems to be discussing this as a possible outcome, so maybe I've got something wrong here, but that's the way it looks to me.

http://www.bbc.co.uk/news/business-18057232

What everyone is missing is a third possibility.

If credit is withdrawn by the EU and IMF, then Greece becomes a cash economy. It means the government can only pay what it collects.

The government starts shutting down, 10-15% of state employees don't get paid and unemployment surges from 20% to 30%.

But Greece can still use the euro.

It would be difficult for the ECB to keep banks afloat. The Greek banking sector would collapse as well.

That would cause more unemployment, as credit for companies would dry up.

What happens next is a political question.

European nations would probably not accept another Western European country descending into chaos and collapse.

The EU and IMF would probably negotiate some kind of aid. But Greece could continue with the euro.

One thing is for sure: TPTB aren't in control of this, and don't know what is going to happen. I think there will only be one re-run of the election in Greece (if any.)

[Aurora]

The Guardian - 14/05/12

European leaders and financial markets braced for Greece exit from euro

Return to drachma nears amid political impasse in Athens and open discussion in Brussels of possible end of single currency.

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Financial markets are hastily making preparations for a Greek exit from the euro after a day of political and economic turmoil ended with Europe's policy elite admitting for the first time that it may prove impossible to keep the single currency intact.

On Monday night city firms were making sure their computer-trading systems could cope with the return of the drachma, and were predicting that a "grey market" in a new Greek currency could be operating within the next few days.

It's looking increasingly like a done deed - all over bar the shouting.

[Aurora]

Cartoon courtesy of The Guardian - 15/05/12

[Aurora]

The Guardian - 15/05/12

Eurozone crisis live: Greek talks break up without a deal

• Last-ditch talks fail in Athens
• Talks always appeared doomed to failure
• Eurozone economy avoids recession, just
• Analysts still gloomy

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