So yesterday the ECB decided that Greece's debt (rated as junk by everybody) was no longer acceptable as collateral to allow the Greek banks to monetise their assets -- so that they can keep on paying out the Euros in drove to all Greeks who know the game is up. In a nutshell the ECB decided that after a week in power the new socialist government needed a taste of "the baseball bat", mind you its just a taste (Greek banks can still get liquidity but via a less attractive and more costly route). The ECB and Bruxelles bureaucrats (and their elected officials) want one thing, and one thing only -- extend and pretend. They want the troika back in town and they want the status quo re-instated.
The sad truth is that like Paris taxi drivers that protested the arrival of unknown Uber by going on strike, the ECB has shown themselves to be bullies. The new Greek prime minister has made a number of speeches, and interviews, his ECB interlocutors have been caught a number of times with "errand microphones" saying exactly the wrong thing at the wrong time. Bottom line, the Greek prime minister sounds reasonable -- he is winning the popularity contest (not to say that Greeks were not thieving bastards for years) still!
The sad truth is that Greece cannot repay its outstanding debts, the sooner this conversation occurs the faster the problems can be solved. For Europe the problem is fundamental; the population (in Germany in particular) were sold a false bills of goods, they were told that integration would be cheap, they were told that this was going to be easy. They were not told that fundamental flaws had been incorporated -- such as high inflation countries with low inflation countries, they were not told that the partially federated system -- with no real central power was poorly equipped to deal with errand "provinces" such as Greece -- that were borrowing like drunken sailors and had an incredibly high level of corruption, would easily solve all problems.
I'm not sur that Greece will be the winner here. I'm not sure that the left can do this -- because if they fail, its the right that will take over, and Golden Dawn is far less fun then the socialists. Lets not forget that America fought the Russians with the Taliban, the Americans armed the Taliban -- because the enemy of my enemy is my friend. Look at what "friends" America has today... My guess is that Bruxelles and the ECB would rather have this fight another day, even if it means Golden Dawn -- which is not Neo-nazi, bur a full blown Nazi party.
So the ECB has decided to see what it can see, to test Athen's socialists. Frankly, acting this way against a 10 day old government seems a bit...rash. My guess is that they will do this for two weeks and back down, but the damage will have been done -- another Greek bank will go down the tube, and savers in Greece -- the very people who Bruxelles likes and wants to encourage will be made in the paupers, it may convince the rest of Greece that this Europe thing is really not worth the trouble.
Anyway, oil prices are back down to $48.99, the Euro is back at 1.14 to the USD. All is well!
The sad truth is that like Paris taxi drivers that protested the arrival of unknown Uber by going on strike, the ECB has shown themselves to be bullies. The new Greek prime minister has made a number of speeches, and interviews, his ECB interlocutors have been caught a number of times with "errand microphones" saying exactly the wrong thing at the wrong time. Bottom line, the Greek prime minister sounds reasonable -- he is winning the popularity contest (not to say that Greeks were not thieving bastards for years) still!
The sad truth is that Greece cannot repay its outstanding debts, the sooner this conversation occurs the faster the problems can be solved. For Europe the problem is fundamental; the population (in Germany in particular) were sold a false bills of goods, they were told that integration would be cheap, they were told that this was going to be easy. They were not told that fundamental flaws had been incorporated -- such as high inflation countries with low inflation countries, they were not told that the partially federated system -- with no real central power was poorly equipped to deal with errand "provinces" such as Greece -- that were borrowing like drunken sailors and had an incredibly high level of corruption, would easily solve all problems.
I'm not sur that Greece will be the winner here. I'm not sure that the left can do this -- because if they fail, its the right that will take over, and Golden Dawn is far less fun then the socialists. Lets not forget that America fought the Russians with the Taliban, the Americans armed the Taliban -- because the enemy of my enemy is my friend. Look at what "friends" America has today... My guess is that Bruxelles and the ECB would rather have this fight another day, even if it means Golden Dawn -- which is not Neo-nazi, bur a full blown Nazi party.
So the ECB has decided to see what it can see, to test Athen's socialists. Frankly, acting this way against a 10 day old government seems a bit...rash. My guess is that they will do this for two weeks and back down, but the damage will have been done -- another Greek bank will go down the tube, and savers in Greece -- the very people who Bruxelles likes and wants to encourage will be made in the paupers, it may convince the rest of Greece that this Europe thing is really not worth the trouble.
Anyway, oil prices are back down to $48.99, the Euro is back at 1.14 to the USD. All is well!
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