tag:blogger.com,1999:blog-8732662769765511163.post4748325755574793841..comments2023-07-31T11:06:29.485+02:00Comments on Transition: GREXITD. Mario Nutihttp://www.blogger.com/profile/17319653816487296802noreply@blogger.comBlogger24125tag:blogger.com,1999:blog-8732662769765511163.post-55587548600078670342015-06-01T12:46:19.481+02:002015-06-01T12:46:19.481+02:00"Bleak in Greece. Athens’ chances of striking..."Bleak in Greece. Athens’ chances of striking a deal to access a much-needed EUR7.2bn in rescue aid looked even worse on Sunday after Alexis Tsipras, prime minister, accused bailout monitors of making "absurd" demands and seeking to impose "harsh punishment" on Athens." (FT, 1 June)D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-18214324432584213772015-04-21T12:29:37.277+02:002015-04-21T12:29:37.277+02:00The writing is on the wall:
“The European Central...The writing is on the wall: <br />“The European Central Bank is studying measures to rein in Emergency Liquidity Assistance to Greek banks, as resistance to further aiding the country’s stricken lenders grows in the Governing Council” (BloombergBusiness 21/04/2015).D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-45826222271486381012015-04-16T15:16:32.089+02:002015-04-16T15:16:32.089+02:00Two pieces of bad news in today’s FT raise the pro...Two pieces of bad news in today’s FT raise the probability of Greece defaulting in May. <br /><br />Apparently Greek officials have approached informally the IMF proposing to delay the repayment of loans due in May and June (see previous comment) but were told that no rescheduling was possible; indeed they were persuaded not to make that request officially, presumably to avoid an open refusal. <br /><br />At the same time Germany’s finance minister Wolfgang Schäuble is reported to have virtually ruled out, in an interview, that at the Eurogroup meeting in Riga on 24 April a deal might release bailout funds to Athens. "You can't spend hundreds of billions... in a bottle without a bottom."<br /><br />However Die Zeit reports that Ms Merkel now might support emergency measures that would give Greece continued access to ECB Emergency Financial Assistance even in case of default. It is diffisult to believe that ECB rules can be made so flexible, even by Ms M. D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-65554453014581972112015-04-15T17:22:05.593+02:002015-04-15T17:22:05.593+02:00Anything could happen. Greece has paid the $450mn ...Anything could happen. Greece has paid the $450mn or so that it owed the IMF on 9 April, much to everybody's relief, but there still are €2.4bn worth of Treasury Bonds also falling due shortly. Plus €203mn on 1 May and €770mn on 12 May and €1.6bn in June all to the IMF. <br /><br />It all impinges on whether the Troika will decide that Greece has undertaken or is credibly committed to the structural reforms (pension cuts, labour dismissals and privatisations) on which the release of the residual €7.2bn bail-out funds were conditional. <br /><br />Without access to these €7.2bn Greece is likely to default on its payments to the IMF. This does not involve exit automatically but in practice it would, through the cessation of access to ECB Emergency Liquidity Assistance, Bank runs, likely issue of a substitute currency etc. <br /><br />Only time will tell. We will know soon enough.D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-87490869661774171112015-04-15T17:04:09.123+02:002015-04-15T17:04:09.123+02:00So, what is going to happen next? Has Grexit been ...So, what is going to happen next? Has Grexit been averted or is it still in the cards? Zignoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-83327493909676041812015-04-13T23:19:29.615+02:002015-04-13T23:19:29.615+02:00It is certainly credible, Schauble and Papandreu a...It is certainly credible, Schauble and Papandreu are capable of anything. But we will never know whether it the story is true. Jodinoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-91813651684560462922015-04-13T16:54:29.258+02:002015-04-13T16:54:29.258+02:00It has been claimed that "Berlin actually enc...It has been claimed that "Berlin actually encouraged the Papandreou regime in 2009 to exaggerate the size of Greece’s debt hole", see https://hat4uk.wordpress.com/2015/04/09/greek-debt-repudiation-is-varoufakis-about-to-make-a-distinction-between-borrowing-obligations-and-odious-debt/. <br /><br />Is that a credible story? D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-36151929614434179502015-04-07T22:59:16.271+02:002015-04-07T22:59:16.271+02:00Thanks. Amazing. Nihil Novi sub sole.Thanks. Amazing. Nihil Novi sub sole.D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-20480278678122184792015-04-07T21:29:49.791+02:002015-04-07T21:29:49.791+02:00You are right, “Si vis pacem, para pacem” does sou...You are right, “Si vis pacem, para pacem” does sound like something Pope Francis might have said, but as a matter of fact the dictum was coined by Barthélemy Prosper Enfantin, described as an early French socialist and one of the founders of Saint-Simonianism, as early as 2 April 1841, with reference to the war with Algeria.Frednoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-76070099672196013842015-04-04T08:56:19.428+02:002015-04-04T08:56:19.428+02:00Not the best time to ask Russia for financial supp...Not the best time to ask Russia for financial support, in view of the low oil price, Ukrainian sanctions, rouble devaluation and the large fall in Gosbank reserves. But there is still a lot of fat, and half a billion is nothing among friends. D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-66729121558290861882015-04-04T08:52:42.644+02:002015-04-04T08:52:42.644+02:00So the Greek Central Bank is only allowed to print...So the Greek Central Bank is only allowed to print €5 and €10 notes. Perhaps they should be allowed only to mint 1 and 2 cents coins.Zeccanoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-48637400482811602352015-04-04T08:47:11.214+02:002015-04-04T08:47:11.214+02:00Almost half a billion due for repayment by Greece ...Almost half a billion due for repayment by Greece to the IMF on 9 April. And Tsipras meeting Putin in Moscow on 8 April. Will good old uncle Vladimir sign him a fat cheque? Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-23899361040225108122015-04-01T12:06:36.182+02:002015-04-01T12:06:36.182+02:00Not at all, the measure could be easily reversed. ...Not at all, the measure could be easily reversed. Preferably - if the parallel currency was successful in improving competitiveness and reduce debt - after it had recovered the parity with the euro. Or at any time at the market rate of exchange prevailing after the announcement of imminent re-conversion back to the euro.D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-38994117573786072202015-04-01T11:15:43.545+02:002015-04-01T11:15:43.545+02:00If Greece did issue a parallel currency, would thi...If Greece did issue a parallel currency, would this decision be difficult to reverse?Robotnoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-58320222172242622982015-03-31T11:18:28.389+02:002015-03-31T11:18:28.389+02:00Yes, Nico, but evidently Italy's exposure to €...Yes, Nico, but evidently Italy's exposure to €40bn Greek bonds going toxic is regarded by Matteo Renzi - probably wrongly, and in spite of his rhetoric - as a more tangible loss from Grexit than the uncertain indirect advantages of an unlikely European policy change towards investment and growth.D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-818997546624834922015-03-30T00:19:48.542+02:002015-03-30T00:19:48.542+02:00You say that Italy is not supporting Greece out of...You say that Italy is not supporting Greece out of "perceived self-interest", but surely Italy can only gain from Troika generosity towards Greece and the promotion of European policies of investment and growth?Niconoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-76339922690542823642015-03-30T00:11:45.656+02:002015-03-30T00:11:45.656+02:00Sure, the Central Bank of Greece could create euro...Sure, the Central Bank of Greece could create euro balances, but its ability to print euro banknotes is strictly limited. <br /><br />It is true that only 8% of banknotes are printed by the ECB, while the remaining 92% are printed by the national Central Banks of Eurozone member states, but the stock and circulation of banknotes are closely monitored and controlled by the ECB. <br /><br />1) The total amount of banknotes to be printed at any time is authorized by the ECB; <br /><br />2) Each national Central Bank can only print a share of the 92% of euro banknotes authorized by the ECB proportional to its ECB shareholding; <br /><br />3) Each NCB is responsible for the production of certain denominations assigned by the ECB; for instance in 2014 Greece only was enabled to print (directly or through a specialized printer, national or foreign) €5 and €10 banknotes, identified with the letter Y in their serial number. <br /><br />Therefore the the Central Bank of Greece could not print euro banknotes at will.D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-22043987844616375092015-03-27T23:55:12.993+01:002015-03-27T23:55:12.993+01:00"the transition to the new currency presumes ..."the transition to the new currency presumes that the new banknotes and coins can be produced quickly or, better, well in advance in complete secrecy."<br />There is another way, following Milosevic example. Since the end of 1990 Milosevic, reacting to the "austerity" policy of the Markovic federal government instructed the Bank of Serbia to create dinars without the authorization of the Yugoslav Federation Central Bank. This led to the failure of Markovic stabilization policy and to the dissolution of Yugoslavia. Eventually the rate of inflation, which had reached 60% before Markovic, reached with Milosevic astronomical levels. What Tsipras could do is simply to let the Central Bank of Greece create euro balances and print autonomously Euros (as ìt does presently on behalf of the ECB).Alberto Chilosihttps://www.blogger.com/profile/12396350222780208837noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-86097762371958887682015-03-27T04:36:13.656+01:002015-03-27T04:36:13.656+01:00How to re-interpret imaginatively the GSP? There a...How to re-interpret imaginatively the GSP? There are genuine and not simply cosmetic possible improvements,<br /><br />For instance: <br /><br />- remove public investments from the calculation of government deficit; <br /><br />-treat government borrowing for the purpose of paying off arrears owed to government suppliers as a change of creditor and not as an increase in debt; <br /><br />- calculate potential income like the OECD does.<br /><br />These measures alone would promote Eurozone growth as if by magic.D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-16646218481561942282015-03-27T04:22:44.197+01:002015-03-27T04:22:44.197+01:00It has been suggested - among others by George Sor...It has been suggested - among others by George Soros - that the Germans should leave rather than the Southern members. <br /><br />This of course would leade to rapid appreciation of the new DM, just as it happened to the Swiss Frank once the Swiss Central Bank abandoned the peg to the euro. <br /><br />German net exports and therefore income and employment would suffer. Germany has no incentive to do this. Much better to be in a position to enjoy superior competitiveness and bully the rest of Europe. D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-38041032752279842722015-03-27T04:12:03.854+01:002015-03-27T04:12:03.854+01:00And just how would you propose to "imaginativ...And just how would you propose to "imaginatively re-interpret" the suicidal Growth and Stability Pact? With a bit of creative accounting??Goldilocksnoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-10216355078481052012015-03-27T04:02:45.841+01:002015-03-27T04:02:45.841+01:00Would the Eurozone become more manageable if the G...Would the Eurozone become more manageable if the Germans and the Nordic countries left and set up their own strong euro, while the Southern countries kept but made it weaker? Franznoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-60751240505073050372015-03-26T10:16:16.324+01:002015-03-26T10:16:16.324+01:00Once Greece has lost access to aid and ECB Emergen...Once Greece has lost access to aid and ECB Emergency Liquidity Assistance they would have nothing to lose, they could not be fined or threatened with anything. No way a parallel currency could be stopped. And that would be equivalent to a de facto exit.D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-6332584060995925682015-03-26T10:11:56.593+01:002015-03-26T10:11:56.593+01:00Would Greece actually be allowed to issue a parall...Would Greece actually be allowed to issue a parallel currency? Muppetnoreply@blogger.com