Historic Syriza win in Greece

[BrainyMess]

Sorry if there's already a thread...

Could the win of Anti-Austerity coalition be the opening shot in the break-up of the Euro?

Interesting times.

Without having to pay back the debt and interest on debt the Greek Govt would have a primary budget surplus. That is more tax coming in than payments going out..

Now yes maybe. But only after successive governments have borrowed as much money as they possibly could without any care of how this may be paid back in the future.

I too would have loads of money if I hadn't have taken out a mortgage, a car loan and several credit cards. But I have and so it's a moot point.

In general though it will be interesting to see where this ends up. Clearly the burden on the Greek's right now is too high. They won't get out of the debt trap for at least a generation. And that really is down to the fact the entire nation for decades ran around putting everything on credit and paying themselves with loans taken out on plastic.

I can't see Germany allowing Greece to write off a lot of their debt, maybe spread payments over an even longer period. But to do so would invite other countries like Spain, Portugal etc to do the same.

Already you can see Syriza promising to spend money it doesn't have. They've made promises to increase pensions and pay the 13th month again. I mean seriously what is that? What other country pays 13 months of pensions a year??

Public sector wages will be raised again and they're promising to create 300,000 new jobs for the young. All noble policies but I fear to be paid for by money they're borrowing.....again.

"All noble policies but I fear to be paid for by money they're borrowing"

From whom? Who is mad or stupid enough to lend to them now?

Borrowing is probably out of the question but they might be able to sell an island or two in the Aegean Sea (only half joking).

Cote - your analogy of Greece as a 'bad wife' is really very good.

The thing is that Greece knows her husband will never kick her out no matter bad because the consequences for the EU are that first of al it will cost him a lot in divorce payments and her 4 sisters will come after him as well. The EU really cannot afford to have a massive family bust up with all the Southern Med countries defaulting and threatening to leave. If it was just Greece it would be manageable but not with Spain, Portugal, Italy and even France threatening to default. If one does it they will all do it.

The whole thing is a 'Danegelt' you pay Greece off or allow them special favours and suddenly everybody wants the same and more to the point Greece will keep coming back for more and more. The EU is in a real bind here.

I don't think it's that certain that the husband will never kick her out. I feel that the husband has had just about enough of Greece acting like a banana republic - lying about its accounts, taking on huge amounts of debt that was spent on unnecessary infrastructure projects to line pockets & with clearly not a thought about how they would be repaid, being completely ungrateful about the two debt cuts and hugely postponed debt repayment schedule etc. It is not impossible that she will be kicked out of the Eurozone, and even the EU.

I can see Merkel losing the last drop of patience she had re Greece over reports of Greek/Russian courtship.

The other sisters are nowhere near as bad. They have been truthful, they are doing what they can to get out of the hole they are in. Assuming that they would get even a fraction of the help Greece got with its debt, they shouldn't have a problem repaying it and getting back on their feet.

In the news today saying Greece considered voting against further sanctions on Russia.

Just read that the EU caved in and only extended existing sanctions to which Greece agreed.

There is a theory that Syriza is really a trick - the EU oligarchy's and billionaire's last attempt to fool the Greek voters. The Establishment parties have been discredited, so Syriza is the only option they have left. But the theory is that Syriza are bluffing and pretending and that they will let the Greek voters down. They will talk tough but they won't deliver.

Remember that Tsipras actually stood as a candidate for EU Commission President. That is as Establishment as it gets. Le Pen, for example, would never have been able to stand for that position.

Syriza have already backed down immediately over the EU Russian sanctions.

"While the Greeks did call for the decision on tighter sanctions to be delayed, they were not alone: other countries such as Italy and Austria also favored a delay, diplomats said, while Britain and the Baltic states wanted a clearer commitment to imposing new sanctions quickly.

"We are not against every sanction," Kotzias said later. "We are in the mainstream, we are not the bad boys."

www.reuters.com/article/2015/01/29/us-ukraine-crisis-idUSKBN0L22B720150129

Farage was on TV yesterday and seemed to think that Syriza are for real and that Greece may leave the EU before the end of this year. But I think he has read it wrong.

The European elite are not worried, they have factored it all in and Syriza has already had meetings with the bankers and explained what they will do.

"In Brussels, most officials are viewing Tsipras' possible election calmly. "It seems to me an exaggeration that some are painting the devil on the wall," says Olli Rehn, the EU's former currency commissioner. "Syriza is a church with a very broad basis. It will be difficult to keep this alliance together," says the Finn, who is now a member of European Parliament.

www.spiegel.de/international/europe/aims-of-greek-politician-alexis-tsipras-remain-a-mystery-in-europe-a-1011288.html

Why wouldn't Russia offer help Greece, there are probably more Marxists in the Athens government than left in the Kremlin.

Russia has seen the oil price dropping 60% from min 2014, I reiterate has just had its bonds downgraded to JUNK (putting up Russian government borrowing costs) just saw its key interest rate cut from 17% (to try stem the outflow of the Ruble) to 15%, has inflation around 11.4% - and with problems rising in its banking system, is expected to go into recession this year - with high interest rates/inflation and low oil to make it worse.

Greece even within the safety of the Euro and Eurozone/ECB umbrella has a a 10-year government bond yield of 10%, saw around $11 billion wiped off their relatively small stock market in two days after the election, and in a seemingly 'poop or bust' threat on behalf the electorate - has told the IMF/ECB/EU to poke their $7.2 billion in loans to be paid by end February, based on various conditions.

As to the "EU cave in" on more Russian sanctions, I'd suggest the EU has seen what awaits the Russian economy, as they see what awaits the Greek economy, in or out of the Eurozone.

Clearly Athens wants its way NOW, the EU can't work like that even if it wants to, especially a Germany with such as massive financial exposure to the project, which will go on whether the Eurozone in its entirety, or as Tier 1, goes back to the original several mature economic States.

Another complication is Eurozone DEFLATION; remember the 'good old UK days' when if looking at National Debt, or personal mortgages, high inflation rates used to help 'inflate it away', well DEFLATION has the opposite affect.

The positive side for Greece could be that SHOULD the EU agree to refinance their debt i.e. lower interest rates and extend the maturity, the markets PRICING IN an extended period of EU deflation, could help by buying that debt.

P.S. If Russia wants Greece, the EU might want to bring in the waiting Turkey, isn't that how the old Cold War 'stuff' used to work? lol

'the EU might want to bring in the waiting Turkey'

Cameron and the modernisers want that but Farage and France and probably Germany don't. Cameron will have to do an awful lot of highfiving to get his way.

Claig Now is not the time to try and bring Canada into the EU, never mind Turkey, I was joshing.

FYI we are entering February, the General Election is in May with the Conservatives needing to be 8 points over Labour to have the SAME number of seats, so thanks to UKIP/Farage, the ultra pro EU suck-up Labour, SNP, Plaid and Lib Dems will be controlling the Westminster parliament.

It was Labour in 2000 that had the secret 'multicultural' policy knowing non EU citizens (tending to favour socialist partys) could vote in the General Elections that EU citizens couldn't.

The irony being Einstein is that if anyone would throw open the doors again, it will be the Miliband administration that Farage is rooting for.
www.telegraph.co.uk/news/uknews/law-and-order/6418456/Labour-wanted-mass-immigration-to-make-UK-more-multicultural-says-former-adviser.html

"If Russia wants Greece, the EU might want to bring in the waiting Turkey"

If Russia wants to go into a political & economical union with Greece à la EU, they are welcome to have her. That is not what they want, though. Nobody wants to marry the dishonest, high-maintanence, and now potentially promiscuous wife of another man, especially when one sees the trouble she has put him through and the money she has cost. No, Russia just wants to use Greece for its own political & economic ends.

And Turkey will never be accepted into the EU, regardless of how many hoops she jumps through, even if racism & Islamophobia weren't on the rise in Europe. Let's all just stop pretending that it might.

I agree, Cote. We might as well stop pretending that Turkey is a candidate for the EU. It suits the EU politicians to dangle the carrot from time to time, but it is wearing extremely thin now.

As for Russian and Greece: I think the Kremlin would be delighted at the chance to build a base and gain a foothold in the Mediterranean, on a Greek island, let's say. There are certainly plenty of them to choose from. Of course, once they were there, it would be next to impossible to get them out again.

Damn, as if German competition for the deck-chairs wasn't enough.

As the Greek leaders hit the EU road to pass on the message that whether in Greece, Spain, Italy or anywhere else, there should be debt write offs, I have to wonder WHO in THEIR minds, has to then pick up the bill?

If the capital markets currently lending the money by buying the government debt of those countries, who tends to be the end buyer, the fund manager investing the money, or the savings and pensions of individuals - doing the right thing living within their means and putting money aside for a crisis of their own, or retirement?

How fair is that?

The article by Mr Peston below makes a good point, investors buying say Greece at 10% yields are ONLY doing so as the European Central Bank is supporting what economy they currently have, but for how much longer?

The more 'risk' in an investment, the less investment players, all the way down the food chain to the Vulture Funds, and they never play 'fair' when committing funds.

”ECB's power of life or death over Greece”
www.bbc.co.uk/news/business-31090415

”The biggest threat to an orderly resolution of Greece's new debt crisis is that the European Central Bank ceases to fund Greece's banks.”

”And the ECB may well feel obliged to turn off the tap, since right now it is only financing those banks because the country is officially complying with the terms of its IMF and eurozone bailout.”

”So at the moment that Greece was deemed not to be in compliance, it is difficult to see how the ECB could continue to provide emergency liquidity assistance to Greek banks.”

”They would then be in dire straits.”

'Syriza-led Greek parliament ‘will never ratify TTIP’'

The newly-elected government in Athens has always been suspicious of the Transatlantic Trade and Investment Partnership (TTIP) and will use its Parliament majority to sink the EU-US trade pact, claims a former Syriza MEP now turned minister. EurActiv Greece reports.

After making its voice heard in the debate over sanctions on Russia, the new government in Athens is now making its opposition known to the EU-US trade deal, TTIP.
...
Asked by EurActiv Greece whether the promise still holds now Syriza is in power, Katrougkalos replied:

“
“I can ensure you that a Parliament where Syriza holds the majority will never ratify the deal. And this will be a big gift not only to the Greek people but to all the European people”.

www.euractiv.com/sections/trade-society/syriza-led-greek-parliament-will-never-ratify-ttip-311719

Blimey! Do Syriza understand the elite and their game? This is guaranteed to anger the elite mightily. They don't like this sort of thing at all.

Paul Craig Roberts says hat if the EU play hardball with Syriza, then they may get bailed out by Russia and China.

"Paul Craig Roberts – Putin’s Ultimate Move To Crush The EU And NATO"
...
In the short-term, while they [the elite] can still print money, they can keep this rigged system standing. But the minute the value of both the dollar and the euro start collapsing, that’s when the game is over.
...
The Ultimate Black Swan As Countries Are Looted

The bank's clients then buy the premier assets of these countries for pennies on the dollar. It’s a looting process. That’s what happened to Greece. It also happened to Ireland. So if these European countries realize that all they are just being looted, they will then accept Putin’s offer and turn to the Russians and the Chinese. The BRICS can easily assist the Greeks.

These countries would then abandon Germany, Washington and the IMF, who are imposing all these hardships on them and also looting their countries. So there is the potential for the ultimate disaster here if the West is stupid and arrogant enough not to bend. That would mean the unraveling of the European Union and of NATO — the ultimate black swan.”

kingworldnews.com/paul-craig-roberts-putins-ultimate-move-crush-eu-nato/

All it would take now is for Farage to deliver a barnstorming speech in Strasbourg and the whole thing could go belly up.

Why would Syriza ratify TTIP; with open markets Greece, like other objectors, could compete in the U.S. market etc, but they can't even look after themselves.

Funny old world, that those with bloated State employment, can't export it and bring in foreign earnings/currencies.

'Why would Syriza ratify TTIP'

But will the elite sit back and allow tiny Greece to end their entire game?
This is even bigger than Farage saying he will scrap their Climate Change game. It has huge consequences.

If Syriza continue like this, I can't see them staying in power long. They are messing with things above their pay grade.

Farage is as influential in Europe, and climate, as a duck fart in windy weather, what a silly plug.

'The elite' comrade, fully understand that with sovereign debt 'write offs', SOMEONE is 'on the hook' for that money loaned.

So be it the over 300 billion debt of Greece, whatever it is in Spain, Portugal, Italy, Ireland, or the UK's £1,500,000,000,000 (£1.5 trillion) National Debt, it won't go away because having overspent, we wish our debts to go away.

So I would suggest there is more of a danger of the EU imploding by ALLOWING a precedent of countries with unsustainable country economic models, that will start the deficit/debt problem ALL OVER AGAIN, than allowing Greece to exit the EU. IMO.

The Syriza Greek government is looking for a face saving compromise, by extending the loans, but not agreeing the bail out terms, that a high street bank wouldn't accept on a £100 overdraft, never mind creditors with over Euro 300 billion on the line.

I feel sorry for the Greek people, having been given so much hope by a political party that treated their sizable debt as some book keeping entry that can be dismissed as one might press a 'reset' button on a computer.

The power of democracy carries no financial weight when other countries are in a similar but not so severe bind, and others like Germany are so heavily financially exposed to the whole Eurozone project, that they are unable to justify a deal to their own citizens - and a Greece defaulting and leaving the Eurozone, would be a far cheaper financial cut for Germany, and politically less of a domestic voter problem.

There is no short cut to solving a countries debt problems that will wish it away, the lesson maybe being, the sooner you address your problems, the cheaper it will eventually be - ask any Citizens Advice Bureau.

P.S. The CAB will ALSO tell you if you really cannot afford any rescheduling, when to pay the price of bankruptcy.

That time for the Greeks, may be here.