Sun, 29th May 2016

Anirudh Sethi Report


Archives of “austerity” Tag

Greek elections may delay aid, S&P warns

Snap elections in Athens may delay the next disbursement of aid from European creditors, analysts with Standard & Poor’s warned on Friday.

The New York-based rating agency, which affirmed its ‘CCC+’ rating and ‘stable’ outlook, said that elections due in less than two weeks could setback the release of the next tranche of aid under its European bailout package.

Analysts with S&P said that the implementation of reforms passed before Prime Minister Alexis Tsipras called for early elections would not begin until a new Greek government had formed.

Greece swallowed a number of austerity measures to win the bailout programme. In August, the European Stability Mechanism, the EU’s rescue fund, disbursed €13bn to Athens from its new €86bn bailout package, which will cover its financial needs through October

Analysts with S&P added:

Although the Greek economy remains fragile and the September 20 election outcome uncertain, we think the risk of Greece leaving the eurozone has receded to less than a one-in-three likelihood.

The rating agency expects the Greek economy will contract 3 per cent this year, ranking it among the worst-performing of the 130 sovereigns that S&P rates.

Former Greek Finance Minister Varoufakis Launches Pan-European Anti-Austerity Political Party

Varoufakis’ fans get ready! The ex finance minister is preparing to launch a European movement that will develop into a political party. Yanis Varoufakis will push for a Pan-?uropean network for fight austerity. Instead of running for the upcoming elections, he will put his energy into political action on European level.

Speaking to Late Night Live program of Australian ABC National Radio, Yanis Varoufakis described the elections campaign as “sad and fruitless” and said that he will not be running for Greek parliament in the September elections, as he no longer believes in what Syriza and its leader, Tsipras, are doing. 

‘The party that I served and the leader that I served has decided to change course completely and to espouse an economic policy that makes absolutely no sense, which was imposed upon us.

I don’t believe that we should have signed up to it, simply because within a few months the ship is going to hit the rocks again. And we don’t have the right to stand in front of our courageous people who voted no against this program, and propose to them that we implement it, given that we know that it cannot be implemented.”


Breaking -Greek lawmakers approve 3rd bailout package

BREAKING NEWS-FLASHAfter debating through the night, Greek lawmakers have approved the terms of the cash-strapped nations third international bailout.

According to Bloomberg, more than 151 lawmakers in the 300-seat parliament approved the deal.

The deal involves painful tax rises and spending cuts, reluctantly agreed by Greek prime minister Alexis Tsipras following months of wrangling between his anti-austerity Syriza party and international creditors, in return for €86bn of rescue financing.

Eurozone ministers will meet later on Friday to discuss whether to give Greece the money. And Germany has already indicated that it could raise objections.

The next crucial date for Greece is August 20, which is when the nation is scheduled to make a €3.2bn debt repayment to the European Central Bank.

Greeks Get First Look At Their Future: Long Bank Lines And Punishing Taxes

Although the details of Greece’s third bailout program have yet to be finalized, Monday marked the beginning of a new dawn for Greeks. Last week, PM Alexis Tsipras forced a set of draconian “reforms” through parliament and sacked political rivals, effectively legislating away the country’s sovereignty while condemning the Greek people to a fate of even tougher austerity and ensuring that despite rhetoric out of Athens, “normality” will not return to Greece for a very long time. 

Greek banks reopened and as expected there were long lines. On the bright side, the queues were described as “orderly.” From AP:  

In downtown Athens, people lined up in an orderly fashion as the banks unlocked their doors at 8 a.m., taking a number and reading the paper as they waited for their turn at the till.


Many restrictions on transactions, including cash withdrawals, remained, however.


The Greek government kept the daily cash withdrawal limit at 60 euros ($65) but added a weekly limit of 420 euros ($455) that will be available beginning Sunday. This means depositors who don’t make it to the bank on Monday to withdraw cash could pull out 120 euros ($130) on Tuesday instead, and so on, so Greeks don’t have to feel they need to visit an ATM every day.


Bank customers will still not be able to cash checks, only deposit them into their accounts, and they will not be able to get cash abroad with their credit or cash cards, only make purchases. There are also restrictions on opening new accounts or activating dormant ones.





Eurogroup Meeting Ends Without Agreement: “Huge Problems”, “Issue Of Greek Trust Very Difficult”

Equity markets roared higher Thursday and Friday as they ‘knew’ a deal was imminent in Greece because Tsipras appeared to backpedal. However, after someone told Merkel the truth, and “everyone knows you can’t believe” the Greeks, The Eurorgoup Meeting ends with zero agreement after 9 hours of rumor-mongering and escalating tensions. Local reporters noted the leaders could not even agree on what to disagree about as an increasing number of EU member states pushed for either a Grexit or considerably toughersanctions austerity on the Greeks

From the man himself…


Summing up the meeting perfectly…


As Reuters reports (rather more hopefully than many),

Euro zone finance ministers were trying to draft a joint statement on Saturday listing further measures they want Greece to take in order to launch negotiations on a bailout Athens has requested, an EU source said.


The Greek government has put forward a set of reform plans to meet conditions for a three-year loan from euro zone partners but finance ministers said they did not go far enough and several sources said the other 18 euro zone states want Athens to offer additional actions and guarantees of implementation.

*  *  *

Don’t worry though:


Do these look like faces of hope?

There is no press conference and the meeting will resume tomorrow at 11am… shortly before FX markets open.

Tsipras is having some success fighting Germany’s Greek narrative

What most people believe — especially in Germany — is that Greeks are lazy and corrupt. That they need ever-harsher doses of economic reality and austerity to jolt them towards competitiveness.

The government overspent, was given handouts by Northern Europe and has learned nothing.

Merkel has made the country her personal economic punching bag in order to position herself at home as a pragmatic economic manager.

Suddenly, people are starting to have another look.

9 myths about the Greek crisis

The citizens of Greece face a referendum Sunday that could decide the survival of their elected government and the fate of the country in the Eurozone and Europe. Narrowly, they’re voting on whether to accept or reject the terms dictated by their creditors last week. But what’s really at stake? The answers aren’t what you’d think.

I have had a close view of the process, both from the US and Athens, after working for the past four years with Yanis Varoufakis, now the Greek finance minister. I’ve come to realize that there are many myths in circulation about this crisis; here are nine that Americans should see through.

1. The referendum is about the Euro. As soon as Greek Prime Minister Alexis Tsipras announced the referendum, François Hollande, David Cameron, Matteo Renzi, and the German Deputy Chancellor Sigmar Gabriel told the Greeks that a “no” vote would amount to Greece leaving the Euro. Jean-Claude Juncker, President of the European Commission, went further: he said “no” means leaving the European Union. In fact the Greek government has stated many times that – yes or no – it is irrevocably committed to the Union and the Euro. And legally, according to the treaties, Greece cannot be expelled from either. 

2. The IMF has been flexible. IMF Managing Director Christine Lagarde claims that her institution has shown “flexibility” in negotiations with the Greeks. In fact, the IMF has conceded almost nothing over four months: not on taxes, pensions, wages, collective bargaining or the amount of Greece’s debt. Greek chief negotiator Euclid Tsakalatos circulated a briefing on the breakdown that gives details, and concludes: “So what does the Greek government think of the proposed flexibility of the Institutions? It would be a great idea.”

3. The creditors have been generous. Angela Merkel has called the terms offered by the creditors “very generous” to Greece. But in fact the creditors have continued to insist on a crushing austerity program, predicated on a target for a budget surplus that Greece cannot possibly meet, and on the continuation of draconian policies that have already cost the Greeks more than a quarter of their income and plunged the country into depression. Debt restructuring, which is obviously necessary, has also been refused.

4. The European Central Bank has protected Greek financial stability. A central bank is supposed to protect the financial stability of solvent banks. But from early February, the ECB cut off direct financing of Greek banks, instead drip-feeding them expensive liquidity on special “emergency” terms. This promoted a slow run on the banks and paralyzed economic activity. When the negotiations broke down, the ECB capped the assistance, prompting a fast bank run and giving them an excuse to impose capital controls and effectively shut them down. 

EU Officials Unleash The Fearmongery: “The Crisis Has Commenced”

Presented with little comment aside to ask if someone is off-script?


“Financial arrangement with Greece, without immediate prospects of a follow-up arrangement, will require measures by the Greek authorities, with the technical assistance of the institutions, to safeguard the stability of the Greek financial system,” ministers from 18 euro area member-states say today.


“The Eurogroup will monitor very closely the economic and financial situation in Greece and the Eurogroup stands ready to reconvene to take appropriate decisions where needed, in the interest of Greece as euro area member” ministers say in statement after informal meeting in Brussels

Translationyou are on your own, f##kers

Democracy Divided: Public Friction Over EU Deal Exposes More Greek Cracks

Greece, the birthplace of civilization is divided over its deal with Europe. The European Central Bank has approved more emergency bailout money for Greek banks in return for a rise in taxes and pension and health contributions.

 The European Commission has promised an extra $39 billion (€35 bn) of funding if a Greek deal is reached by Wednesday. However, members of Alexis Tsipras’ Syriza party have warned the Greek Prime Minister against betraying the Greek people by reaching bailout compromises with Brussels.

Meanwhile, EU leaders continue to push for a deal to prevent the country from exiting the European Union. And a deal appears to be on the cards — but at what cost?

In what’s become a Greek ritual, thousands of people gather each night in Syntagma Square in Athens. Rival groups meet outside the Greek parliament. One side are demanding an end to austerity and more bailout deals with Europe. Another side are calling for continued membership with the European Union.