Category Archives: Currencies

Greece’s Fate in ECB’s Hands if Eurogroup Talks Fail

As most readers know well, Greece made concessions yesterday to the Eurogroup that, although contested as to how far they went, were seen as big enough concessions to win the support of Eurogroup head Jeroen Dijsselbloem and Italy. But Germany’s Wolfgang Schauble almost immediately rejected them, setting the stage for a showdown today. As we’ve discussed from the outset, the biggest bone of contention continues to be “conditionality,” otherwise known as structural reforms. Greece wants to be able to revise some measures as long as it can still meet its primary surplus target. Germany insists a deal is a deal and Greece must reaffirm all the terms of its existing agreement.

The meeting is set to start in Brussels at 3 PM local time, so we’ll know soon enough how things turn out. The two sides are making friendlier noises as of this morning, but we’ve seen these public displays of collegiality before, only to be followed by negotiation ruptures.

Greece, Its International Creditors and the Euro

his is an excellent background piece on how Greece got where it is and how its various bailouts were structured. It also helps explain the past and current roles the various members of the Troika play and discusses the prospects for Greece achieving its aims.

Robert Parenteau: Get a TAN, Yanis: A Timely Alternative Financing Instrument for Greece

TAN, or tax anticipation notes, would way be a for Greece to give itself more fiscal spending wriggle room without violating Eurozone rules. That will likely be necessary if Monday’s meeting in Brussels results in no extension of the current Eurozone bailout.

Eurogroup Ministers to Syriza: Drop Dead

Even though the US has waded into the Greece versus Troika impasse to press Eurozone officials to soften their position on austerity, the battle lines seem only to get harder.

Outlook Darkens for Syriza and Greece

Greece’s finances look to be more precarious than previously thought, which puts Syriza in an even weaker bargaining position.

Obama, Treasury Pushing Back Against Troika Grexit Threats; Bernie Sanders Presses for Fed to Prod ECB

The Administration realizes the risk of Grexit is real and is trying to fend that off. But even if they succeed, don’t expect that to add up to much in the way of relief for Greece.

Is Syriza About to Score a Tactical Win Against the Troika?

Those who were hoping that Syriza would be cowed by the ECB’s aggressive moves to shut Greece out of bond markets and Eurozone finance ministers’ unified resistance to the new government’s proposals are no doubt frustrated by its refusal to capitulate. On Sunday, Greek prime minister Alexis Tsipras gave a rousing speech reaffirming Syriza’s plans.

Bracing for Another Storm in Emerging Markets

This post dovetails with the Michael Pettis article today. Hot money is the bane of emerging markets, but the opposition to regulating capital flows remains fierce.

Time for #GreekLivesMatter

If you are not part of the solution, you are part of the problem.

The Troika’s willingness to turn Greece into a failed state first, as a side effect of its “rescue the French and German banks” operation, and now, as part of its German hegemony protection racket, is killing people and in the longer term will only accelerate the rise of extreme right wing elements in the Eurozone. As Ilagi wrote last week:

Does the EU have any moral values at all? And if not, why are you, if you live in the EU, part of it? .

Because you don’t have any, either? And if you do, where’s your voice? There are people suffering and dying who are part of a union that you are part of. That makes you an accomplice. You can’t hide from that just because your media choose to ignore your reality from you.

ECB to Greece: Drop Dead

Even by the standards of bank thuggishness, the move by the ECB against Greece last night was a stunner. Americans have become used to banks taking houses under dubious pretexts when both the investors and borrowers would do better with a writedown. But to see the ECB try take a country is another matter entirely. As one seasoned pro said, “If anyone had tried something like this against a country with a decent sized military, the tanks would be rolling.”

Will the Cavalry Ride Over the Hill in Time for Greece?

We’ve cautioned readers that Greece is in a very weak bargaining position relative to its financial overlords in the Troika. As much as Finance Minister Yanis Varoufakis is making sound, logical arguments and presenting proposals that if anything are too accommodating, despite initial cool reactions, many of Greece’s soi disant partners are diehard neoliberals and/or are politically constrained. Varoufakis is approaching them as if they can deal in good faith, when their idea of “good faith” comes from a punitive parallel universe.

Three important meetings today will provide a better sense of whether Greece is gaining any political ground in its uphill battle to roll back austerity.

Syriza Walks Back Initial Defiance

Victims of austerity and their allies around the world may be placing too much hope in Syriza.

Mathew D. Rose: Hope for Greece, and Perhaps for Europe Too

Monday morning I encountered a word in a number of newspapers that I have not read regarding the European Union for years: Hope. The occasion was the election in Greece. I suddenly became aware of how long much of this continent has been living in what appears to be a never ending-crisis.

The ECB’s QE Decision

The European Central Bank has just launched full-fledged quantitative easing. This column argues that the ECB’s watershed decision highlights both the strengths and the persistent vulnerabilities of the Eurozone. The limited-risk-sharing provision flags the need for greater fiscal union; and governments should use the respite that QE provides to launch much-needed structural reforms.

That’s their story and they’re sticking to it.