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Greece Upbeat As They Look Forward To The Next Hand Out From The 15 Billion Fund

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http://uk.finance.yahoo.com/news/Greece-confident-get-fourth-reuters_molt-110466032.html?x=0

Greece confident to get fourth EU/IMF aid tranche
Angeliki Koutantou and Ingrid Melander, 19:22, Sunday 6 February 2011
ATHENS (
Reuters
) - Greece is confident it has made enough progress on its fiscal consolidation plan to get the green light this week for a fourth tranche of EU/IMF (Berlin: MXG1.BE - news) aid, a government official said ahead of an inspection visit.
International Monetary Fund and European Union officials start talks on Monday to evaluate whether the country has met fourth-quarter targets under the bailout plan that saved it from bankruptcy in May and qualifies for the next, 15 billion euro ($20.4 billion) aid instalment.
"The (aid) tranche is secured," said the finance ministry official, who declined to be named.

How will the EU know if they are in compliance or not? Bits of paper with columns of numbers and signaturesat the bottom?

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How will the EU know if they are in compliance or not? Bits of paper with columns of numbers and signaturesat the bottom?

Just take their word for it... worked well last time :D

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Targets or no targets all Greece has to do is threaten to default on some of the bonds.. and Germany and co will write the next cheque with an attached note of apology for questioning them.

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Greece will definitely default. The only question is when, time has been bought but nothing else.

The economy is caught in a classic debt trap and there are no policy options that can facilitate escape. In the long run restructuring and a return to competitiveness is the only solution.

Doing this without destroying the euro and the European banking system is the big problem. Perpetual bail out and recession a certainty for Greece until this problem is solved.

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Greece will definitely default. The only question is when, time has been bought but nothing else.

The economy is caught in a classic debt trap and there are no policy options that can facilitate escape. In the long run restructuring and a return to competitiveness is the only solution.

Doing this without destroying the euro and the European banking system is the big problem. Perpetual bail out and recession a certainty for Greece until this problem is solved.

It seems the EU's only plan is to just bail them out and hope for something to come along. The Euro authorities have decided that no Euro nation can be allowed to default. And I agree with them, the Euro would go down the tubes.

As has been pointed out many times the US situation is so different. Even if one state defaults its not on national bonds and does not affect the US dollar. That state in trouble can still rely on vast transfer payments coming in.. pensions, health care, military, etc.. amounting to nearing 30% of GDP for the average state. In the EU what are transfer payments like 2% of gdp?

The US state can do cutbacks without having the demand destruction - in fairness as Europe's economy integrates they gain this strength too.

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It seems the EU's only plan is to just bail them out and hope for something to come along. The Euro authorities have decided that no Euro nation can be allowed to default. And I agree with them, the Euro would go down the tubes.

As has been pointed out many times the US situation is so different. Even if one state defaults its not on national bonds and does not affect the US dollar. That state in trouble can still rely on vast transfer payments coming in.. pensions, health care, military, etc.. amounting to nearing 30% of GDP for the average state. In the EU what are transfer payments like 2% of gdp?

The US state can do cutbacks without having the demand destruction - in fairness as Europe's economy integrates they gain this strength too.

please explain why a country defaults its bonds, that just happen to be in a particular currency, that the currency itsefl would be at risk.

120,000 bankrupts in sterling havnt collapsed the £

Edited by Bloo Loo

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please explain why a country defaults its bonds, that just happen to be in a particular currency, that the currency itsefl would be at risk.

120,000 bankrupts in sterling havnt collapsed the £

Good question. I guess it could hit institutional holders of currency who buy bonds to hold as reserves. Of course national governments and national central banks who hold x amount of other nation's currency for trade and capital flows.

Probably Greece would only be a few percent of their Euro holdings.. but it would scare them to wake up and find I'm sorry 60% of the Greek Euro bonds you were holding are worthless. The next logical step for these institutional holders would be to get scared and want to move everything to the safest Euro bonds, or perhaps even right out of Euros.

Banks also hold a perscribed percent of their capital as national bonds. That could get interesting for Greece's banks if the state defaulted on their tier 1 capital.

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Good question. I guess it could hit institutional holders of currency who buy bonds to hold as reserves. Of course national governments and national central banks who hold x amount of other nation's currency for trade and capital flows.

Probably Greece would only be a few percent of their Euro holdings.. but it would scare them to wake up and find I'm sorry 60% of the Greek Euro bonds you were holding are worthless. The next logical step for these institutional holders would be to get scared and want to move everything to the safest Euro bonds, or perhaps even right out of Euros.

Banks also hold a perscribed percent of their capital as national bonds. That could get interesting for Greece's banks if the state defaulted on their tier 1 capital.

I can understand the shock and horror of making a loss, but diversification is fundamental to these and any investors.

surely the investors would be better off as a group by allowing say a 40% default in the capital on greek bonds....that would benefit the borrower, keep interest coming for the bad lending, and be a good all round philip to the all round health of the world.

Default doesnt necessarily mean total collapse.

course, lenders will tell you other wise.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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