Death Star Economics



New Greek government promises to last at least 48 hours

Much like back in March, when Greece was continuously close to reaching a deal with its creditors, Antonis Samaras is allegedly close to reaching a coalition agreement. Today is day 3 of coalition talks and the deadline is tonight.

The not much anticipated renegotiations between Greece and EU regarding the terms and conditions of the previous bailouts is likely to kick off on Thursday in Luxembourg. That is provided there is a Greek finance minister. At this point it looks like it is going to be Vassilis Rapanos, currently chairman of Greece’s largest commercial bank. But the amount of rumors of government officials supporting and rejecting (the rejection mostly coming from Germany) the possibility of a renegotiation make it pretty difficult to see through the haze. I guess we’ll have to wait until tomorrow.

AHA! Hang on, Greece has a new government with Antonis Samaras as Prime Minister from tonight on! From ZeroHedge:

Venizelos sazs key issue will be to form a “bailout renegotiation team.” So new government will be very short.

Any kind of progress comes in handy, as the Greek economy is pretty much disappearing altogether. The Athens Chamber of Commerce expects the country’s economy to shrink by 7.8% in 2012. ‘Ouch’ doesn’t really cover it anymore.

The FT is bringing us the heartbreaking story of Medical Service Limited, a Greek healthcare equipment manufacturer who had to stop paying its employees last week. And even though an order for a new heart monitor came in, the company couldn’t find the money it would have to prepay to its German suppliers, because Greek banks have slashed all opportunity on credit.

Close enough to Greece, my favorite quote of the day comes from Cyprus, where a bank bailout is waiting to happenread article

“I calculated that there’s 278 hours left until June 30,” the date by which Cyprus Popular Bank has to be recapitalized, Cypriot Finance Minister Vassos Shiarly said on Tuesday. “We’re counting the hours.”

It’s promising that he could do the math.

Also, the EU proposed setting up its own credit rating agency handling sovereign ratings. The European Creditworthiness Authority would provide rating much like S&P, Fitch and the like, except it would be incredibly pro-Europe, i.e. pro-money-to-those-who-can’t-really-repay-it. Ironically, the point of the ECA would be to make rating more objective. Right. This too could be part of dancing around the eurobonds issue. read article

Otherwise, both the UK and the US are waiting for another round of quantitative easing, with the former being a little bit more of a [almost] done deal. read article

Related: Jared Bernstein is giving an emotional defence of Keynesianism in Rolling Stone. read article

So long.


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One Response

  1. princess1960 says:

    OK GR will go out ..first..after follow OTHERS ..ONE BY ONE
    THANK YOU this is fact

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