[billybong]

Quote

...but the firm is exerting enormous influence as a behind-the-scenes adviser to troubled governments around the globe.

In Greece, BlackRock is helping determine just how much capital the country’s banks will need to raise in the coming months. It is a crucial step as Greece tries to fix its banking industry and its broader economy, but the task is a risky one.

Sounds a bit like Squidy's role in 2002 when Greece wanted "behind the scenes" advice then.

Thank goodness lessons will have been learnt

"...helping determine just how much capital the country’s banks will need to raise in the coming months" possibly means how much if they go Drachma but just as likely means how much bailout money to ask for the next time?

[interestrateripoff]

Eurozone debt crisis: how Greece could exit the euro

Quote

..

Already into its fifth year of recession, more than half of Greece’s under 25s are now out of work. Yet the government is promising to cut another 150,000 public sector jobs over the next three years. With protests on the streets and an election in April, who knows how much austerity is even deliverable.

..

Hence the planning for an eventual Athens exit – not least by the Greeks. Some €16bn has been sent abroad since 2009, with Britain the favoured destination – as the mini-boom at the top of London’s housing market might testify. Meanwhile, bank deposits in Greece have fallen by €70bn over the same period.

As the country’s outgoing finance minister Evangelos Venizelos noted, while this is partly due to families or businesses raiding savings to cope with the crisis: “Many billions are kept in homes. They are, as we say, in mattresses or boxes.”

..

In the next month we should start seeing the first entries to the Wolfson Economic Prize, the £250,000 award for “the person who is able to articulate how best to manage the orderly exit of one of more member states from the European Monetary Union”. Many of the world’s top economists are sweating the numbers. In Greece’s case, it might go something like this.

It would start with a shock weekend announcement. First question: would it be an agreed or hostile exit? Assume agreed, as a hostile one would unleash chaos, with runs on eurozone banks, not least in Portugal, Ireland, Spain and Italy. But who would Greece agree it with – given the dangers of leaks?

Miles Saltiel, the lead author of the Adam Smith Institute’s entry for the Wolfson prize, envisages Greece holding a “relatively last-minute conference call with about a dozen people”. They might include ECB chief Mario Draghi, Germany’s Angela Merkel and whoever is then in charge of France – or, more likely in Saltiel’s view, their civil service representatives. The IMF would probably be in on the call too.

The danger of leaks I'm sure the Greek political elites have been very busy getting their cash out of the Greek system.

It will probably be the worst kept secret of all time. We'll have endless denials from the elites before it happens. I really can't see them swallowing their pride until the bitter end.

[The Masked Tulip]

interestrateripoff, on 25 March 2012 - 06:41 PM, said:

The danger of leaks I'm sure the Greek political elites have been very busy getting their cash out of the Greek system.

It will probably be the worst kept secret of all time. We'll have endless denials from the elites before it happens. I really can't see them swallowing their pride until the bitter end.

I am bored with Greece now.

It keeps promising to blow up the global financial system but never delivers. A bit like those Greek waiters who promise to take British girls to Heaven and back, but who only make it as their hotel bedroom.

[frederico]

The Masked Tulip, on 25 March 2012 - 07:44 PM, said:

I am bored with Greece now.

It keeps promising to blow up the global financial system but never delivers. A bit like those Greek waiters who promise to take British girls to Heaven and back, but who only make it as their hotel bedroom.

the thing about greece is that nothing has changed, just the loans extended and moved to a different lender, the lender of last resort, the question is can that lender support spain, ireland, portugal and italy.

what happens when greece needs another 130bn, and then the whole Greek national debt is covered by the ECB and IMF and is still growing.

[SeeYouNextTuesday]

http://www.guardian....isis?CMP=twt_gu

[interestrateripoff]

http://uk.reuters.co...E82R17J20120328

Quote

Greece must tackle its aversion to mandatory redundancies and the closure of public entities if it is to fully escape its debt crisis, the country's International Monetary Fund mission chief said in London on Wednesday

It won't escape the debt crisis until it defaults.

[JaneTracy]

Just when you thought it couldnt get any worse in Greece take a look at this.

Quote

Update: Greek retail sales

Just after I wrote this post these were released and what a grim tale they tell.

The retail trade volume index, including automotive fuel, decreased by 10.3% in January 2012 compared with January 2011. The Index in January 2011 recorded a decrease of 16.1% compared with January 2010 .

For those who follow the underlying index then it is now at 79.6 where the base is 2005=100.

http://www.mindfulmo...is-a-toxic-mix/

Chilling isnt it? Where is the improvement we keep being promised by her government and the Euro zone.....?

[interestrateripoff]

JaneTracy, on 30 March 2012 - 12:45 PM, said:

Just when you thought it couldnt get any worse in Greece take a look at this.



http://www.mindfulmo...is-a-toxic-mix/

Chilling isnt it? Where is the improvement we keep being promised by her government and the Euro zone.....?

So if the base is 2005 and it's now 79.6, where does that place the Greek economy? 2000? Or earlier?

This post has been edited by interestrateripoff: 30 March 2012 - 12:49 PM

[copydude]

interestrateripoff, on 30 March 2012 - 12:49 PM, said:

So if the base is 2005 and it's now 79.6, where does that place the Greek economy? 2000? Or earlier?

Yes, it's being internally devalued back to the stone age.

[billybong]

JaneTracy, on 30 March 2012 - 12:45 PM, said:

Just when you thought it couldnt get any worse in Greece take a look at this.



http://www.mindfulmo...is-a-toxic-mix/

Chilling isnt it? Where is the improvement we keep being promised by her government and the Euro zone.....?

Fom the comments.

Quote

Hi Shaun a good analysis of the failings of current economic theories, as being implemented in the Eurozone. Theories are one thing, the reality is how it affects the lives of ordinary citizens. It seems a gratuitously cruel experiment with youths and pensioners playing the roles of the lead laboratory rats. I just wonder how long it is until the rats wake up and make good their escape?

Talking of inflation, I guess you've seen the excellent article on the subject this week from your blogosphere nextdoor neighbour Simon Ward?

"In a Guardian interview a year ago the MPC’s leading dove, Adam Posen, predicted that inflation would tumble to 1.5% by the middle of 2012 and stated that: “If I have made the wrong call, not only will I switch my vote, I would not pursue a second term.” Will Dr. Posen honour his pledge or try to shift the goalposts by appealing to economic weakness or claiming his forecast was blown off course by yet more “one-off” shocks?"

I like Simon's use of the term "economic weakness" meaning more inflation, I guess he sees things the same way as you! H But, has Posen got any "wriggle room" do you think, or will he be bidding us, the MPC and his index linked pension au revoir?

This post has been edited by billybong: 30 March 2012 - 01:51 PM

[copydude]

billybong, on 30 March 2012 - 01:50 PM, said:

Fom the comments.

Theories are one thing, the reality is how it affects the lives of ordinary citizens. It seems a gratuitously cruel experiment with youths and pensioners playing the roles of the lead laboratory rats. I just wonder how long it is until the rats wake up and make good their escape?

Jane T posts good stuff from that blog. It's nof theory anymore, is it. Portugal, Spain, Greece . . . not forgetting Latvia, where the economy shrunk 29% and 10% of the workforce left the country . . . kinda proves that internal devaluation is a self-defeating social holocaust.

But Merkel knows best.

Greek bailout 3 is coming sooner than anyone thinks. Along with total anarchy.

[Game_Over]

You would think Stagflation had never occurred.

Producers cannot reduces prices below the level at which they are able to make a profit.

And if fixed costs are rising then prices will rise no matter how weak the demand is.

[Game_Over]

copydude, on 30 March 2012 - 04:14 PM, said:

Jane T posts good stuff from that blog. It's nof theory anymore, is it. Portugal, Spain, Greece . . . not forgetting Latvia, where the economy shrunk 29% and 10% of the workforce left the country . . . kinda proves that internal devaluation is a self-defeating social holocaust.

But Merkel knows best.

Greek bailout 3 is coming sooner than anyone thinks. Along with total anarchy.

To be fair, the only way out of this is to dismantle everything that was done in the last 30-40 years

And none of the current crop of politicians is prepared or capable of doing this.

Whatever happens it isn't going to end well.

[Deckard]

copydude, on 30 March 2012 - 04:14 PM, said:

Greek bailout 3 is coming sooner than anyone thinks.

L-Pap practically announced it already.

Quote

Prime Minister Lucas Papademos was Friday unable to give opposition party leaders the reassurances they sought that wages and pensions will be protected from further cuts but stressed that the full implementation of reforms was crucial to safeguard the country’s eventual exit from the crisis.

Responding to questions by Giorgos Karatzaferis, leader of the Popular Orthodox Rally (LAOS), which broke from the governing coalition in February, and by the head of the Coalition of the Radical Left (SYRIZA), Alexis Tsipras, the premier did not try to present a rosy picture. The aim is to avoid further wage cuts, he said. “But there can be no commitment.”

He added that the outlook for rising unemployment was not good, noting that “joblessness will probably increase and the recession will probably continue.”

“The economy will remain weak for the most part of 2013,” he added, revising a more optimistic prediction he had made a few weeks ago of a likely recovery from the middle of next year. “This year will not be easy. And the beginning of next year will not be easy,” he said.

On pensions, Papademos said the state had the capacity to fund them until 2015 but that state funding and benefits must be cut to ensure their viability after that.

As for further cuts of 12 billion euros that the government has promised creditors, Papademos said authorities were drafting proposals on how these cuts will be achieved. The tough job, however, of implementing the proposals and raising the revenue will fall to the next administration. “The next government and the next parliament will decide,” he said, adding that “the decisions won’t be easy.”

Comments by the premier to Italian daily Il Sole 24 Ore in an interview published Friday were also downbeat. Papademos said he could not rule out a third bailout. “Greece will do everything possible to make a third adjustment program unnecessary,” he said. “Having said that, markets may not be accessible by Greece even if it has implemented fully all measures agreed on. It cannot be excluded that some financial support may be necessary.”

Papademos is urging ministers to focus on approving reforms ahead of elections, expected on May 6. One of the reforms -- the liberalization of the taxi sector -- is to be debated in Parliament on Monday. A bill outlining the changes was tweaked Friday after MPs proposed changes.

It's just a question of how soon.

[Josieful]

copydude, on 30 March 2012 - 04:14 PM, said:

Jane T posts good stuff from that blog. It's nof theory anymore, is it. Portugal, Spain, Greece . . . not forgetting Latvia, where the economy shrunk 29% and 10% of the workforce left the country . . . kinda proves that internal devaluation is a self-defeating social holocaust.

But Merkel knows best.

Greek bailout 3 is coming sooner than anyone thinks. Along with total anarchy.

Yes I agree and the post referred to was very informative about how the Greeks have suffered from inflation at a time that economic theory would have told you they would not have any! And that it was being made worse by the wage cuts.....

How will they ever repay the debt with falling real wages? Is an insightful question.