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"greece Demands Their Goodies, Regardless." We Will Get The Bill


karlunity

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"Greece demands their goodies, regardless."
The Greeks are a very clever people. Think of Odysseus.
What they Will do is say: if you of the EU do not forgive our debt, write it off as German repayments for WW ll, AND pay a large settlement for our trouble, We Greeks, will leave the EU and go into a trade agreement with Russia and China. Perhaps even allow them a old NATO base or two.
Nor do we fear that Russia will take over, as if they get too demanding, we will call on NATO to remove them, which NATO must, to protect their flanks.
Greeks will have their cake and eat it too...at least that is their hope.
I suspect the check to pay off the EU and keep Greece in NATO is already written in Washington and very soon to be delivered.
And yes, the ole American tax payer will get the bill again.
With out even a glass of ouzo. This would not have worked even 4 years ago as Russia, then hoping to be part of Europe, would not have wanted to annoy the EU.But now with the sanctions imposed by the West over the Ukraine, The second cold war is on and the Geeks see a useful ploy

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I've spent some time reading about the Greek situation, and it's pretty complicated. Some tidbits: they work more hours by far than the rest of Europe, but they are not as productive or industrialized. Kids live with parents and grandparents, who frequently make it by with one pension check for the whole family. There is a lot of under the table work that robs the government of tax revenues. Essentially, they have an aging population, underemployment, and are barely making it by. Some raid garbage cans. Jobs are the answer, but that isn't discussed.

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The maritime industry is way down right now. There's an index, here's the chart:

 

http://stockcharts.com/h-sc/ui?s=%24BDI&p=W&b=5&g=0&id=p71532397570

 

Yes, shipping is a major (the major?) industry in Greece and it just isn't happening because of the global depression we are in. It is easy to read the main stream news and say "oh, the Greeks are lazy greedy ..." but it isn't the case. Yes, they have a large black market. All corrupt governments eventually drive the market to a black market economy. But the people do that to survive. Realize that entire families (2-3 generations) are living on one $800/mo pension, and the EU is saying that $800 is too much and needs to be cut.

 

It is pretty much mathematically impossible for them to ever repay the "debt" they have, just like the US. They just got pushed into the corner first.

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The Greeks Will have to play Russia / China against The EU as was done Egypt during Cold war l. If they get away with it ..Spain...Italy..Portugal may give it a go.

Germany has been paying out of guilt and France out of fear of Germany, if the EU comes apart. Questions are: How long will Germany keep paying and can France afford to write off the debts of Greece and the Med nations? A few years ago the Greeks had no where to turn. Now they do

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zerohedge.com has in-depth coverage. The problem is the derivatives based on this debt. The derivatives are something like 20x or more the total debt, and are side bets the banks make. As long as nothing happens, they expire worthless and the banks keep the derivative money. If the Greeks default, then the banks have to pay up on the defaulted loan through the 20x+ leveraged derivative chain. Then it gets ugly. The derivative chains are what brought on 2008, and that was just for mortgage backed securities, not for state bonds.

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Dr. Hess

So if I understand you, it would be in the banks best interest to continue to loan the Greeks a minimum in order to limit the banks loss.

Yet the banks want to be able to pass the loss on to the taxpayer so they must be able to blame the Greeks if the deal goes south.

If they are not able to do that, they ..the pols and the bankers fear that they may well go the way of their colleagues in Iceland.

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Yes, that's pretty much it. That's why Greece has had all these bailouts for the past 5 years. They were totally bankrupt then, but if everyone admitted it, the banks would go bust. Instead, the banks flipped the majority of the actual bond liability onto various governments (AKA "the people") to try to make sure that the derivatives would not blow up, and kept adding more "loans" to cover the interest payments. The Greeks got something like 10-15% of the actual "bailout" loans. The rest went to banks. Meanwhile they kept selling derivatives, which was very lucrative to the banks, as long as they are never called.

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True sir. Now they are saying that July 20 is der tag.

It is far from a sure thing that the Greeks will accept. But they seem to be over a barrel.

 

Unless they can make a deal with Russia or China.

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