Greek money pit swallows another Eur120bn

vivatifosi

StevieJ wrote: »

How can it be a default if it is an action proactively orchestrated by the bond holders. If Fitch want their day in the sun they may as well just call a default now. Wait a minute this is what Fitch said a couple of weeks ago.

It did make me think "When is a default not a default? When its a default." Or words to that effect. It just seems like it doesn't matter what the Greek government does. It doesn't matter how much people protest. It doesn't matter who is compliant or who wears a hair shirt. They are going to be seen as defaulting even if they don't. Having said that, I'm not convinced the Vienna deal is a good one. Nor am I convinced anything will stave off the inevitable. But what do I know, I'm just a bystander.

the_flying_pig

I'm starting to think that we should never give them the Elgin Marbles back.

sm1234

But...
The problem is that the sheeple have very short memories/lack of ability to fully connect cause & effect (and politicians know that).

When Greece defaults it's going to be very messy for France & Germany; and as London/New York backed derivatives on Greek debt unwind, and contagion spreads to the PIIGS (and the UK?); there will be carnage across Europe/the globe. The majority of voters will feel pain and naturally blame the sitting government. If current leaders do the right thing and take the pain now, to save greater pain later; it will still be pain taken ON THEIR WATCH. Kicking the can down the road, until it becomes impossible to do so, is the only thing that politicians can and will do. That is why Greece will limp on for a good while yet. Cameron is playing a poker game by publicly distancing himself from the bailout; but using less public means to support the bailout (pressure on state-owned banks).

System

Why do they keep calling these things "loans" and "debts"? Greece hasn't a hope of ever repaying them because the money is not being invested wisely in anything profitable, in fact it's not being invested at all.
These are gifts, exactly like donations to the 3rd world. How much do we want to give to people who can't be bothered to sort out a taxation system so that they can pay for their own subsistence?

Rochdale_Pioneers

Clifford_Pope wrote: »

Why do they keep calling these things "loans" and "debts"? Greece hasn't a hope of ever repaying them because the money is not being invested wisely in anything profitable, in fact it's not being invested at all.
These are gifts, exactly like donations to the 3rd world. How much do we want to give to people who can't be bothered to sort out a taxation system so that they can pay for their own subsistence?

And if any proof is needed that this is the case, consider the original "loan" of Eur120bn that has been burned, prompting the request for the new "loan" of another Eur120bn.

I hope the riots today are so bad that the wavering MPs realise they will get lynched if they vote through the package.

Generali

StevieJ wrote: »

How can it be a default if it is an action proactively orchestrated by the bond holders. If Fitch want their day in the sun they may as well just call a default now. Wait a minute this is what Fitch said a couple of weeks ago.

http://ftalphaville.ft.com/blog/2011/06/20/599161/vienna-plus/

AIUI, the usual standard for a CDS (credit default swap) is that it is a default if S&P, Moody's and Fitch all say it is. Triggering CDSs seems to be on the 'avoid strongly' wishlist.

Again AIUI, and Sovereign CDS isn't my area, the theory goes that the banks have been pushed into an extension rather than the debt being rolled over by auction. As such the banks really face Hobson's choice so this is a default even if Governments and banks want to pretend otherwise.

My opinion as a non-expert is that this is a default in all but name, a partial default at the very least. Greece can't afford to roll over the debt in the market at a interest rate (coupon) of 25%. Either someone else buys the debt for less or they default.

Rumours have it that they're trying to get the Chinese to buy the debt. I have my doubts but anything is possible.

StevieJ

Current standing on Greek vote.

100 Yes 92 No, still ongoing.

StevieJ

Vote passed.

wotsthat

StevieJ wrote: »

Vote passed.

As I see it they've agreed to default after the trucks laden with cash arrive from Germany rather than before.

Makes sense.

ILW

Have the Greek protestors got any idea of an alternative to the current plans?