What Greece Won

FEB. 27, 2015

By Paul Krugman

The New York Times

Last week, after much drama, the new Greek government reached a deal with its creditors. Earlier this week, the Greeks filled in some details on how they intend to meet the terms. So how did it go?

Well, if you were to believe many of the news reports and opinion pieces of the past few days, you’d think that it was a disaster — that it was a “surrender” on the part of Syriza, the new ruling coalition in Athens. Some factions within Syriza apparently think so, too. But it wasn’t. On the contrary, Greece came out of the negotiations pretty well, although the big fights are still to come. And by doing O.K., Greece has done the rest of Europe a favor.

Greece Stirs Doubt on Debt Owed IMF

Cash-Strapped Athens Suggests It Might Be Short on Some March Payments

By IAN TALLEY And  ALKMAN GRANITSAS

Feb. 27, 2015 7:33 p.m. ET

32 COMMENTS

Greece’s cash-strapped government suggested in the past week that it might default on some of the debt it owes the International Monetary Fund in March, which would make it the first advanced economy in the institution’s seven-decade history to fall into protracted arrears with the fund.

Humiliated Greece eyes Byzantine pivot as crisis deepens

Neither side holds the upper hand in the strategic game of chicken which could still see Greece forced out of the euro

By Ambrose Evans-Pritchard, in Athens2:24PM GMT 28 Feb 2015

Greece's new currency designs are ready. The green 50 drachma note features Cornelius Castoriadis, the Marxisant philosopher and sworn enemy of privatisation.

The Nobel poet Odysseus Elytis - voice of Eastward-looking Hellenism - honours the 200 note. The bills rise to 10,000 drachma, a wise precaution lest there is a hyperinflationary shock as Greece breaks out of its debt-deflation trap at high velocity.

Greece seeks negotiations on ECB bond repayment

ATHENS Sat Feb 28, 2015 3:53pm IST

(Reuters) - Greece called into question on Saturday a major debt repayment it must make to the European Central Bank this summer, after acknowledging it faces problems in meeting its obligations to international creditors.

Greece runs out of funding options despite euro zone reprieve

Fri Feb 27, 2015 9:22am EST

* Greece faces 1.5 bln euro debt payment to IMF in March

* Lenders rule out three short-term funding options

* Pressure on Athens to quickly complete bailout review for aid

By Jan Strupczewski and Deepa Babington

What Greece Has to Do Now: Fix Its Economy

Michael G. Jacobides

FEBRUARY 27, 2015

After weeks of media frenzy around the Greek election and the new government’s once-ambitious plans to renegotiate with the Eurozone over its debt crisis, the searchlights of publicity are shifting. For all of its bravado, Greece was pushed into a corner in an eleventh-hour deal that will extend a bailout agreement for four more months. And although it has been given a temporary lifeline, little has been resolved.

Greece and geopolitics

A semi-guided missile

The Economist

America, much more than Europe, sees strategic stakes in the Aegean

Feb 28th 2015 | From the print edition

NEVER imagine that the euro zone is the only club in which Greece is a maverick player. The Hellenic relationship with NATO, and bilateral defence ties with the United States, have long been important (although many would say diminishing) and contested.

In Greece, Bailout May Hinge on Pursuing Tycoons

By LIZ ALDERMANFEB. 26, 2015

The New York Times

ATHENS — As he sifted recently through a sheaf of Greek bank accounts held by executives, politicians and other members of the Greek elite, Panagiotis Nikoloudis, the nation’s new anti-corruption czar, was struck by some troubling numbers.

A man who was claiming unemployment benefits and declared zero income on his taxes had more than 300,000 euros, or $336,000, stashed away at his bank. Another, who told the tax authorities that his annual income was just €15,000, turned out to have €1.5 million in various bank accounts.

Tsipras Reversal Draws Greek Sympathy as Party Rumblings Rise

by Maria Petrakis

"...While the main sentiment in Greece is hope, in Brussels the word being bandied about is “trust”..." 

Unlikely Winners of Greece's Surrender

FEB 26, 2015 2:00 AM EST

By Mark Gilbert

Bloomberg

The Greek government's apparent capitulation in debt negotiations with its euro partners makes it less likely that Athens will be forced out of the common currency. The real winners, though, are the European governments who have stuck with spending cuts in the face of mounting domestic opposition. They don't have to worry about a successful austerity renegade giving ammunition to their opponents.

ECB’s Draghi Defends Policy Toward Greece

Draghi Says ECB Is Willing to Accept Greek Bonds as Loan Collateral If Athens Sticks to Pledges

By TODD BUELL And  BRIAN BLACKSTONE

Updated Feb. 25, 2015 4:13 p.m. ET

The Wall Street Journal

FRANKFURT—European Central Bank President Mario Draghi defended the ECB against criticism that it acted in a heavy-handed way toward Greece during the country’s bailout negotiations with creditors, saying the central bank was simply applying its lending rules.

The Reason Austerity In Greece Didn't Work

2/26/2015 @ 4:13AM 71 views

Tim Worstall

Forbes

One of the little puzzles of the past few years has been why was the reaction of the Greek economy to austerity so much worse than that of other countries? For it is true that other countries (I think particularly of Spain and Portugal) had the same sort of shrinkage of the government budget, had the same (entirely wrong and inappropriate) monetary and currency policies but they did much better. Or at least not as badly. So what was the secret to that Greek economy that made the out turn so awful? And awful it is, Greece has had a fall in GDP akin to what the US had in the Great Depression of the 1930s. The answer, it appears, is that the underlying structure of the Greek economy is such that it just couldn’t take advantage of the meagre benefits that austerity did provide.

What Greece Needs

By ARISTOS DOXIADIS

FEB. 25, 2015

The New York Times 

ATHENS — The depression ravaging Greece is always framed as an issue of macroeconomics: fiscal policy was tightened too quickly; government debt is too high; the tools of currency devaluation and monetary expansion are not available inside the eurozone. But this is overly simplistic; local politics and microeconomic factors are just as important in explaining the depth of the crisis.

What Greece Can Learn From Israel About Tax Cheats

4 FEB 24, 2015 12:55 PM EST

 Bloombergview

By Stephen Mihm

Among the most closely watched commitments made by Greece to obtain a four-month extension of aid from its official creditors is a promise to overhaul its notoriously inefficient system of tax collection and administration.

Skeptics, particularly among the law-abiding citizens of other European countries who believe their tax euros will be wasted on the continued bailout of Greece, will have hard time buying this pledge.  

Greece debt crisis: Eurozone backs reform plans

BBC 

Eurozone finance ministers have approved reform proposals submitted by Greece in order to obtain a four-month extension of its bailout.

The Eurogroup said it had agreed to begin national procedures - parliamentary votes in several states to give the deal final approval.

The measures offered by Greece include combating tax evasion and reforming the public sector.

After Bailout Plan Approval, Greece Faces a Balancing Act

By JAMES KANTER and NIKI KITSANTONISFEB. 24, 2015

The New York Times

BRUSSELS —

Eurozone finance ministers on Tuesday approved Greece’s plan meant to ease the hardships created by its international bailout, extending that loan program by four more months.

In revising the terms of the bailout program, the new Greek government pledged to take a disciplined approach to budgets, spending and tax collection, while remaining committed to relieving the “humanitarian crisis” caused by years of economic hardship and high unemployment. Many Greeks blame the austerity-budget requirement of the bailout program, agreed to by a previous government, for those privations.

What The Eurogroup Demands Is Absurd

by Paul Krugman on 19 February 2015

Paul Krugman was interviewed by Evan Davis on the BBC’s Newsnight programme on 17th February. The following is a transcript of the part of the interview dealing with the negotiations for a new deal for Greece.

I don’t know what you think but how far should the Eurozone go, the European Commission, in helping yield to what Syriza is asking for?

GREECE'S FUTURE IS ITS PAST

Posted by Rebecca Harding on Feb 23rd 2015,

A deal was done at the last minute: Greece’s €172bn debt bailout was extended for a further four months after a turbulent week of bluff and counterbluff. Even now, there are no formal agreements on the required reform process ahead and without these agreements the deal will not be ratified. It appears that the Greek government is keen to demonstrate its willingness to reform by focusing on tax evasion and civil service reform, but it is unlikely that this will be sufficient for either Germany or the ECB.

Grexit: Was Germany ready to pull the trigger?

A temporary deal largely on German terms has been struck to avoid Greece crashing out of the euro. A key factor may have been that Germany was ready to contemplate Grexit - Syriza wasn't.

23 February  2015+

As we predicted and noted in our instant response to Friday’s deal to keep Greece in the euro, as things stand, Syriza spent an awful lot of political capital in return for limited result.+

There are several reasons why  Syriza’s bargaining hand is relatively weak. At the end of the day, Syriza isn’t yet prepared to contemplate Grexit, with over 70% of the Greek public still in favour staying in the euro. In contrast, it may well be the case that the German government genuinely was ready to let Greece go, absent a deal. You can credit Syriza for acting responsibly on that point. However, it also meant that in that epic stand-off between Wolfgang Schäuble and Yanis Varoufakis, only one of them had a nuclear option.+

Greece sends comprehensive reform plan to lenders: EU source

BY ROBERT-JAN BARTUNEK

BRUSSELS Tue Feb 24, 2015 4:56am EST

(Reuters) - Greece sent a list of economic reform plans to European institutions and the International Monetary Fund around midnight that was "a valid starting point" for talks over its bailout, a source close to the European Commission said on Tuesday.

Grexit for the Good of the Eurozone

Posted: 02/23/2015 8:28 pm EST Updated: 02/23/2015 8:28 pm EST

Russell Green Become a fan

Will Clayton Fellow for International Economics at Rice University's Baker Institute for Public Policy

http://www.huffingtonpost.com/russell-green/grexit-for-the-good-of-th_b_6737680.html

If the Greeks leave the Eurozone, it would be awful. Both Greece and the remainder of the euro area would experience damaging volatility and uncertainty. But "Grexit" does not have to be all bad. In fact, if the Eurozone countries use the crisis to push through long-needed reforms, they could wind up in a much stronger position in the long run.

Greece Delays Submittal of Its Overhaul Plans

By NIKI KITSANTONIS and JAMES KANTERFEB. 23, 2015

The New York Times

ATHENS — Greece on Monday delayed the submission of the proposed reforms that European creditors have made a condition of the country’s financial aid.

European and Greek officials spent much of the day exchanging drafts of the proposals paring back austerity and ensuring Greece can still meet its budget targets. While they underscored the progress made, Athens will now present the list Tuesday morning, after the original deadline of Monday night.

Eurogroup statement on Greece

 (http://www.consilium.europa.eu/en/press/press-releases/2015/02/150220-eurogroup-statement-greece/)Original document

_______________________________________________________________________________

The Eurogroup reiterates its appreciation for the remarkable adjustment efforts undertaken by Greece and the Greek people over the last years. During the last few weeks, we have, together with the institutions, engaged in an intensive and constructive dialogue with the new Greek authorities and reached common ground today.

The Eurogroup notes, in the framework of the existing arrangement, the request from the Greek authorities for an extension of the Master Financial Assistance Facility Agreement (MFFA), which is underpinned by a set of commitments. The purpose of the extension is the successful completion of the review on the basis of the conditions in the current arrangement, making best use of the given flexibility which will be considered jointly with the Greek authorities and the institutions. This extension would also bridge the time for discussions on a possible follow-up arrangement between the Eurogroup, the institutions and Greece.

The Greek authorities will present a first list of reform measures, based on the current arrangement, by the end of Monday February 23. The institutions will provide a first view whether this is sufficiently comprehensive to be a valid starting point for a successful conclusion of the review. This list will be further specified and then agreed with the institutions by the end of April. 

Only approval of the conclusion of the review of the extended arrangement by the institutions in turn will allow for any disbursement of the outstanding tranche of the current EFSF programme and the transfer of the 2014 SMP profits. Both are again subject to approval by the Eurogroup.

In view of the assessment of the institutions the Eurogroup agrees that the funds, so far available in the HFSF buffer, should be held by the EFSF, free of third party rights for the duration of the MFFA extension. The funds continue to be available for the duration of the MFFA extension and can only be used for bank recapitalisation and resolution costs. They will only be released on request by the ECB/SSM.

In this light, we welcome the commitment by the Greek authorities to work in close agreement with European and international institutions and partners. Against this background we recall the independence of the European Central Bank. We also agreed that the IMF would continue to play its role.

The Greek authorities have expressed their strong commitment to a broader and deeper structural reform process aimed at durably improving growth and employment prospects, ensuring stability and resilience of the financial sector and enhancing social fairness. The authorities commit to implementing long overdue reforms to tackle corruption and tax evasion, and improving the efficiency of the public sector. In this context, the Greek authorities undertake to make best use of the continued provision of technical assistance.

The Greek authorities reiterate their unequivocal commitment to honour their financial obligations to all their creditors fully and timely.

The Greek authorities have also committed to ensure the appropriate primary fiscal surpluses or financing proceeds required to guarantee debt sustainability in line with the November 2012 Eurogroup statement. The institutions will, for the 2015 primary surplus target, take the economic circumstances in 2015 into account.

In light of these commitments, we welcome that in a number of areas the Greek policy priorities can contribute to a strengthening and better implementation of the current arrangement. The Greek authorities commit to refrain from any rollback of measures and unilateral changes to the policies and structural reforms that would negatively impact fiscal targets, economic recovery or financial stability, as assessed by the institutions.

On the basis of the request, the commitments by the Greek authorities, the advice of the institutions, and today's agreement, we will launch the national procedures with a view to reaching a final decision on the extension of the current EFSF Master Financial Assistance Facility Agreement for up to four months by the EFSF Board of Directors. We also invite the institutions and the Greek authorities to resume immediately the work that would allow the successful conclusion of the review.

We remain committed to provide adequate support to Greece until it has regained full market access as long as it honours its commitments within the agreed framework.

Greek reform list to comprise mainly structural actions: government source

BY RENEE MALTEZOU

ATHENS Sat Feb 21, 2015 12:41pm EST

(Reuters) - Greece's list of reforms to be submitted to the euro zone on Monday comprises pledges on structural issues such as tax evasion and corruption over the next four months without specific targets, a government official said on Saturday.

Athens clinched a last-minute deal late on Friday to avoid a banking collapse by accepting a conditional extension of its bailout program. The accord requires Greece to submit by Monday a letter to the Eurogroup listing all the policy measures it plans to take during the remainder of the bailout period.

Tsipras declares victory as Greece dodges financial ruin

BY GEORGE GEORGIOPOULOS AND KAROLINA TAGARIS

ATHENS Sat Feb 21, 2015 3:13pm EST

(Reuters) - Greek Prime Minister Alexis Tsipras declared victory on Saturday after agreeing a conditional financial rescue deal with Europe and despite making big concessions to avert a banking collapse within days.

German-Led Bloc Willing to Let Greece Leave Euro, Scicluna Says

by Paul TugwellNikolaos Chrysoloras

11:34 AM EET

February 20, 2015

(Bloomberg) -- Germany and its allies are ready to let Greece leave the euro unless Prime Minister Alexis Tsipras accepts the conditions required to extend his country’s financial support, according to Malta’s finance minister, Edward Scicluna.

Has Greece's 'Lehman moment' finally arrived?

Matt Clinch     | @mattclinch81

2 Hours Ago

A key week for Greece's economic future drew to a close on Friday with the country facing the very real threat that it's running out of money and key analysts warming to the idea that it could be on its way out of the euro zone.

Euro zone finance ministers are set to meet Friday to discuss Greece's latest proposals to extend its loan agreement. But with Germany already rejecting the plan, there is very little hope that an agreement will be announced. Another meeting in Brussels for next week was already being touted before Friday's meeting even began. The main problem for the fiscally disciplined countries like Germany is that, despite the ground Greece has given up in the last week, it is still asking for the bailout loan without all of the strict austerity conditions that come with the money.

Greek economist Elena Panaritis, former member of the Greek Parliament and the World Bank, drew comparisons with the collapse of the Lehman Brothers in 2008. As with the fall of the big U.S. bank, market-watchers feel euro zone policymakers want to show the world they will only be pushed so far — with the result being Greece would be allowed to exit the euro zone.

Panaritis thought there was a "political statement as well as economic statement" being made during the negotiations. Randy Kroszner, a former U.S. Federal Reserve governor and the professor of economics at the University of Chicago Booth School of Business, agreed that there were comparisons between the two events.

"I think there a parallel, but the tools exist if the European Union wants to keep Greece in and if Greece is willing to stay in," he told CNBC Friday. "Even though it may be quite ugly, the likelihood of complete chaos is much lower. So that gives policymakers more willingness to say 'Hey, we'll take that risk'."

http://www.cnbc.com/id/102441576#.

Varoufakis Meets Euro Partners as Greece Seeks to Avoid Default

by Paul TugwellMarco Bertacche

11:34 AM EET

February 20, 2015

(Bloomberg) -- Greek Finance Minister Yanis Varoufakis returns to Brussels for a third meeting in two weeks with his euro-area counterparts in an effort to strike a deal that will let Europe’s most-indebted country avoid default.

This is the eurozone risk investors are ignoring

Published: Feb 20, 2015 3:21 a.m. ET

Financial contagion gives way to political contagion

http://www.marketwatch.com/story/this-is-the-eurozone-risk-investors-are-ignoring-2015-02-19

NEW YORK (MarketWatch) — Greece, as you may have heard, is hurtling toward potential default and a potential exit from the eurozone. Investors are largely taking it in stride.

Opinion: Why the U.S. will have to bail out Greece

Marketwatch.com

By MATTHEW LYNN

Published: Feb 18, 2015 4:00 a.m. ET

Fighting has flared up again in the Ukraine. The Egyptians are sending soldiers into Libya as another North African state collapses into chaos. The militants of Islamic State are spreading their influence across the region. You’d think Barack Obama might have bigger foreign policy issues to worry about than a small state of 10 million people on the eastern edges of the Mediterranean.

Syriza’s scattergun

Feb 21st 2015

Greece had a chance to make the euro zone work better. It blew it

http://www.economist.com/news/europe/21644237-greece-had-chance-make-euro-zone-work-better-it-blew-it-syrizas-scattergun?fsrc=scn/tw/te/pe/ed/syrizasscattergun

CLIP-CLOPPING around Europe over the past few weeks, Yanis Varoufakis, Greece’s dashing finance minister, has urged the euro zone to chart a new course. Endlessly forcing new loans upon indebted countries like Greece in the pretence that they will one day be repaid, he argued, was a strategy for depression and deflation. “The disease that we’re facing in Greece,” he told the BBC, “is that a problem of insolvency for five years has been treated as a problem of liquidity.”

Greece requests euro zone loan extension, offers big concessions

BY RENEE MALTEZOU AND JAN STRUPCZEWSKI

ATHENS/BRUSSELS Thu Feb 19, 2015 6:13am EST

(Reuters) - Greece formally requested a six-month extension to its euro zone loan agreement on Thursday, offering major concessions as it raced to avoid running out of cash within weeks and overcome resistance from skeptical partners led by Germany.

With its EU/IMF bailout program due to expire in little more than a week, the government of leftist Prime Minister Alexis Tsipras urgently needs to secure a financial lifeline to keep the country afloat beyond late March.

Euro zone finance ministers will meet on Friday afternoon in Brussels to consider the request, the chairman of their Eurogroup, Jeroen Dijsselbloem, said in a tweet.

Greece expected to seek loan extension from skeptical euro zone

BY LEFTERIS PAPADIMAS AND JAN STRUPCZEWSKI

ATHENS/BRUSSELS Wed Feb 18, 2015 5:07pm EST

(Reuters) - Greece is expected to ask on Thursday for an extension to its "loan agreement" with the euro zone as it faces running out of cash within weeks, but it must overcome resistance from skeptical partners led by Germany.

With Greece's bailout program due to expire in little more than a week, the government of leftist Prime Minister Alexis Tsipras urgently needs to secure a financial lifeline to keep the country afloat beyond late next month.

Financial markets rallied after Athens said on Wednesday it would submit a request to extend the loan agreement for up to six months, hoping this signaled a last minute compromise to avert a Greek bankruptcy and exit from the euro zone.

Η ρητορεία της «πλατείας»

Του Πάσχου Μανδραβέλη

Καθημερινή

http://www.kathimerini.gr/804137/opinion/epikairothta/politikh/h-rhtoreia-ths-plateias

«Πώς κυβερνούνται οι χώρες και οδηγούνται στον πόλεμο;» είχε αναρωτηθεί στις αρχές του περασμένου αιώνα ο μεγάλος Αυστριακός συγγραφέας Καρλ Κράους. «Οι διπλωμάτες λένε ψέματα στους πολιτικούς και όταν τα διαβάζουν τα πιστεύουν και οι ίδιοι». Ελπίζουμε ότι δεν ισχύει το ίδιο για τις χρεοκοπίες, αλλά πρέπει να ανησυχήσουμε από το γεγονός ότι το επιχείρημα που φέρνει η κυβέρνηση για το αδιέξοδο στις διαπραγματεύσεις είναι όσα λένε κάποιοι στις «πλατείες», δηλαδή σε συγκεντρώσεις τις οποίες αφανώς διοργανώνει ο ΣΥΡΙΖΑ, όπως κατήγγειλε στη Βουλή η κ. Αλέκα Παπαρήγα. Οι «πλατείες» όμως έχουν τη δική τους δυναμική. Δεν πιέζουν τους εταίρους· σιγά μην πιεστούν 18 κυβερνήσεις της Ευρωζώνης από 10.000 άτομα στο Σύνταγμα. Εγκλωβίζουν την κυβέρνηση σε αδιέξοδα και μεγάλα λόγια. Για να ικανοποιηθούν οι «πλατείες», η κυβερνητική και παρακυβερνητική ρητορεία κατά των ετέρων χτύπησε κόκκινο και αυτό είναι αυτεπίστροφο. Το κλίμα κατά της Ελλάδος έχει επιβαρυνθεί πάρα πολύ, σε σημείο που πρέπει να ανησυχούμε μην υπογραφεί τελικώς συμφωνία και αυτή να κολλήσει σε κάποιο Κοινοβούλιο ευρωπαϊκής χώρας.

THE TWO WORDS DIVIDING GREECE AND THE EUROGROUP

Posted by Frances Coppola on Feb 17th 2015,

http://www.pieria.co.uk/articles/greece_the_two_words_that_ended_the_eurogroup_meeting

The meeting of Eurogroup financial ministers broke up suddenly yesterday amid Greek accusations that the Eurogroup had moved the goalposts. The Greek delegation leaked to the press a draft communique that the Eurogroup had apparently presented to the meeting, saying that it contained things that they could not possibly agree to. Reuters published the full text here.

Europe and Greece Are at War Over Nothing

FEB 19, 2015 12:01 AM EST

By The Editors

Bloomberg

Even by the demanding standards of European dysfunction, the continuing standoff between Greece and the other euro countries is impressive. On substance, the distance between the two sides has narrowed almost to nothing -- yet the stalemate and the risk of a new financial crisis drag on as if it were vast. The EU is staking the future of its monetary union not on principles but on semantics.

Why Greek Exit From The Euro Would Be A Very Bad Idea

2/17/2015 @ 7:50PM

Frances Coppola

http://www.forbes.com/sites/francescoppola/2015/02/17/why-greek-exit-from-the-euro-would-be-a-very-bad-idea/

Ever since the election of the Syriza government, there has been growing talk of Greece leaving the Euro. Markets are jittery: fears of Greek default and exit are forcing up Greek bond yields, and the Greek stock market is on a roller-coaster ride, falling with every piece of news that suggests rising exit risk then bouncing back when exit doesn’t happen and everyone calms down. There is a silent run on Greek banks as depositors fearful of re-denomination losses remove their funds to safe havens.

And it’s easy to see where those funds are going. German claims on the Target2 settlement system are rising fast, leading uber-hawk Professor Hans Werner Sinn to demand capital controls be imposed to end capital flight from Greece. Exactly why he thinks capital controls are a good idea at this stage is not entirely clear: he seems to fear that the rest of the Eurozone will be forced to bail out the Greek central bank, which is providing liquidity through the ELA scheme to enable those funds to be moved without bankrupting Greek banks.

Greece Poised to Request Six-Month Loan Extension

by Jonathan StearnsPatrick Donahue

7:57 PM EET   February 17, 2015

(Bloomberg) -- Greece may request an extension of its loan agreement for six months, according to a person familiar with the matter, a step that could ease a standoff with creditors over the country’s future financing.

Prime Minister Alexis Tsipras’s government intends to make the request on Wednesday, the person told reporters in Brussels, asking not to be named as the deliberations are private. Talks are continuing between Greece and its international creditors on the conditions that would be attached to the extension of the loan accord, the person said.

Tsipras Needs to Rethink His Timetable

FEB 17, 2015 5:00 AM EST

By Mohamed A. El-Erian

http://www.bloombergview.com/articles/2015-02-17/el-erian-tsipras-needs-to-slow-his-timetable-for-greece

Less than a month into its tenure, the Greek government is finding that it will be very difficult to fulfill electoral promises to rapidly change the country’s economic management and its relations with its European partners.

The approach taken by Alexis Tsipras, Greece's charismatic new prime minister, and his finance minister, Yanis Varoufakis, an economist with strong communication skills, has been bolstered by broad recognition that their nation is unlikely to regain economic dynamism and financial stability without a revision of its existing mix of austerity, structural reform and debt relief.

Greek Euro Exit Risk Increases as EU Delivers Ultimatum

 by Karl Stagno Navarra and Mark Deen

(Bloomberg) -- Greece edged closer to a euro exit after the currency region’s finance ministers said there will be no more talks on financial support unless the Greek government requests an extension of its existing bailout program.

After three weeks of sparring since Prime Minister Alexis Tsipras’s election victory, finance chiefs hardened their positions as negotiations in Brussels ended abruptly on Monday night with Greek Finance Minister Yanis Varoufakis refusing to bow to European demands.

Greece defies creditors, seeking credit but no bailout

BY RENEE MALTEZOU AND INGRID MELANDER

BRUSSELS Tue Feb 17, 2015 4:19am EST

(Reuters) - Talks between Greece and euro zone finance ministers over the country's debt crisis broke down on Monday when Athens rejected a proposal to request a six-month extension of its international bailout package as "unacceptable".

A Flawed Plan B for Greece

Little common ground exists for Greece and the eurozone to commit to reach a new long-term deal

The Wall Street Journal

By SIMON NIXON

Feb. 15, 2015 6:51 p.m. ET

It is a mark of the gulf that still separates Greece and the rest of the eurozone that an agreement last week simply to engage in “technical discussions” was hailed as a step forward in the search for a solution to the country’s debt crisis.

Eyes of the world on Greece

BY MIKE PEACOCK

LONDON Sun Feb 15, 2015 4:03am EST

(Reuters) - The coming week will go a long way to dictating whether Greece remains in the euro zone.

A meeting of euro zone finance ministers on Monday is tasked with producing a deal that will keep Greece solvent and which is acceptable to both sides.

A similar meeting last week, marking Greek finance chief Yanis Varoufakis' debut, got nowhere over seven hours of talks.

Greece, EU see need for 'national reform plan' to fix economy

BY KAROLINA TAGARIS

ATHENS Sun Feb 15, 2015 10:46am GMT

(Reuters) - Greece has agreed with its European partners that there needs to be a "national reform plan" to deal with decades-long issues of the economy, its government spokesman said on Sunday.

But he added in a wide-ranging interview on Greece's Skai TV that the new government will not clash with the public based on orders from outside.

Greece and its euro zone partners are in difficult negotiations over demands by the new government of leftist Prime Minister Alexis Tsipras for an end to austerity and a renegotiation of Greece's debt.

Greece will do 'whatever it can' to reach deal with EU: spokesman

ATHENS Fri Feb 13, 2015 5:15am EST

(Reuters) - Greece will make every effort to reach an agreement with its euro zone partners at Monday's meeting of euro zone finance ministers on how to transition to a new support program, its government spokesman said on Friday.

"We will do whatever we can so that a deal is found on Monday," Gabriel Sakellaridis told Skai TV. "If we don't have an agreement on Monday, we believe that there is always time so that there won't be a problem."

'Grexit' would be no easy ride for austerity-weary Greeks

BY JEREMY GAUNT

ATHENS Thu Feb 12, 2015 8:53am EST

(Reuters) - "Grexit" would be sudden, sharp and probably conducted in the dark of night; if Greece were to quit the euro, it would also mark the beginning of a long, hard road - for some harder still than the one already traveled.

The new leftist government wants to keep the country in the currency union, as do its euro zone counterparts. But if they fail to agree a deal to replace or extend a bailout program that expires on Feb. 28, Greece faces the risk of a euro exit - "Grexit" in market shorthand - forced by bankruptcy and default.

Lessons From Argentina’s Default

The New York Times

From Alan Cibils is the chair of the political economy department at the Universidad Nacional de General Sarmiento in Buenos Aires.

As an economist who lived through the Argentine crisis nearly a decade ago, I am distressed by the trouble in the euro zone because it has many of the same ingredients that led to the Argentine debacle.

Greece, EU Strike Friendlier Tone After Hopes of Quick Deal Are Dashed

Last-Minute Change of Mind Dashed Hopes of Quick Resolution to Standoff With Creditors

The Wall Street Journal

By VIKTORIA DENDRINOU And  GABRIELE STEINHAUSER

Updated Feb. 12, 2015 7:34 p.m. ET

75 COMMENTS

BRUSSELS—Leaders from Greece and the rest of the eurozone struck a conciliatory tone Thursday, a day after the country’s new government dashed hopes of a quick resolution to the standoff between Athens and its creditors.

Greece and Germany Are Working Toward a Compromise

by Rebecca ChristieEleni and ChrepaBirgit Jennen

(Bloomberg) -- Greece and Germany are pursuing a deal on the conditions required to continue the Greek bailout as each side signals a willingness to compromise, according to government officials taking part in the talks.

Hitting the ground running—backwards

Greece and the euro

http://www.economist.com/news/leaders/21643139-unless-syriza-changes-course-greece-inexorably-heading-out-euro-hitting-ground

The Economist

Unless Syriza changes course, Greece is inexorably heading out of the euro

WHEN the far-left Syriza party won the Greek election last month, the hope was that the new prime minister, Alexis Tsipras, would moderate his demands so as to compromise with his country’s creditors. After all, he (like the vast majority of Greeks) wants to stay in the single currency. But even as he prepared to meet fellow European Union leaders for the first time this week, he was making a Greek exit from the euro ever more likely.

Argentina’s Lessons for Greece

Raquel Fernández

(Raquel Fernández is Professor of Economics at New York University. )

Jonathan Portes

(Jonathan Portes is Director of the National Institute of Economic and Social Research.)

Read more at http://www.project-syndicate.org/commentary/greece-lessons-from-argentina-by-raquel-fern-ndez-and-jonathan-portes-2015-02#1AQmWPCTlxsfb6aH.99

NEW YORK – Thirteen years ago, Argentina was in dire straits. Its peso was pegged to the dollar at a level that far exceeded its value. Its external debt was unsustainable. And political pressure from the United States prevented its weak government from renegotiating a bailout program that even the International Monetary Fund knew was unrealistic.

The Greek Austerity Myth

FEB 10, 2015 23

Daniel Gros

BRUSSELS – Since the anti-austerity Syriza party's victory in Greece's recent general election, the “Greek problem" is again preoccupying markets and policymakers throughout Europe. Some fear a return to the uncertainty of 2012, when many thought that a Greek default and exit from the eurozone were imminent. Then as now, many worry that a Greek debt crisis could destabilize – and perhaps even bring down – Europe's monetary union. But this time really is different.

 One critical difference lies in economic fundamentals. Over the last two years, the eurozone's other peripheral countries have proven their capacity for adjustment, by reducing their fiscal deficits, expanding exports, and moving to current-account surpluses, thereby negating the need for financing. Indeed, Greece is the only one that has consistently dragged its feet on reforms and sustained abysmal export performance.

Syriza Isn’t Giving the Greeks the Whole Story

Elevated talk may bolster the Tsipras government’s domestic support, but it does nothing to inform voters about Europe’s political reality.

The Wall Street Journal

By YANNIS PALAIOLOGOS

Feb. 10, 2015 2:28 p.m. ET

Athens

The moment of truth has arrived. The six days starting with Wednesday’s meeting of eurozone finance ministers in Brussels will determine the ability of Greece’s new government to come to terms with its European partners and avoid a catastrophic Greek exit from the currency bloc.

Greece to Propose a Debt Compromise Plan to Creditors

By LIZ ALDERMAN and NIKI KITSANTONISFEB. 9, 2015

The New York Times

ATHENS — Hoping to defuse a standoff that has set Europe and financial markets on edge, Greek officials intend to propose a detailed compromise plan at an emergency meeting with creditors on Wednesday in Brussels, a finance ministry official here said on Monday.

UK planning for possible Greece exit from the eurozone

Robert Peston

Economics editor

BBC

The prime minister this morning chaired a meeting of senior officials to discuss the impact on the UK of possible Greek exit from the eurozone - and to take steps to ensure British banks and companies would not be excessively damaged.

Η λιτότητα και ο θάνατος

ΠΟΛΙΤΙΚΗ 08.02.2015 : 18:11

Του Πάσχου Μανδραβέλη

Εφημερίδα Καθημερινή

Η αλήθεια είναι πως σχεδόν όλοι -πλην κάποιων ψυχασθενών- είμαστε κατά του θανάτου. Ευτυχώς, η πρόταση περί κατάργησης του αναπόφευκτου δεν υπήρξε ποτέ σε προεκλογικό πρόγραμμα, έτσι ώστε να βρεθεί κάποιος κυβερνήτης που θα έλεγε «σκέφτομαι να πρωτοτυπήσω και να εφαρμόσω όσα προεκλογικά εξήγγειλα». Αναφέρουμε τη λέξη «κυβερνήτης» διότι κάποιος που θα επιχειρηματολογούσε πειστικά ότι «θα καταργήσει τον θάνατο» θα είχε ισχυρότατη λαϊκή εντολή. Πάνω από 90% θα τον ψήφιζαν, αλλά το ποσοστό αυτό μάλλον δεν θα ήταν και ιδιαίτερα πειστικό επιχείρημα απέναντι στον Χάρο.

Europe Weighs the Costs Of Casting Greece Aside

Officials Debate the Financial and Strategic Consequences of a Greek Exit

By STEPHEN FIDLER

Updated Feb. 5, 2015 5:16 p.m. ET

How much does Greece matter to Europe? It’s a question being asked by European officials as the brinkmanship over the country’s bailout program intensifies.

The answer is important because it will help determine how far governments will go to accommodate the economic demands of new Greek Prime Minister Alexis Tsipras, and whether they will be willing to court an outcome that could lead Greece to leave the euro and possibly the European Union.

Why Greece’s leftist Syriza will bow down to market pressures

COMMENTARY by  Nicholas Economides  FEBRUARY 5, 2015, 12:21 PM EST

http://fortune.com/2015/02/05/why-greeces-syriza-party-will-bow-down-to-market-pressures/

As talks break down between Greece and international lenders, it’s clear there are few options left for the country’s economy to stay afloat.

Greek stocks and bonds plunged on Thursday after the European Central Bank said that it would stop accepting Greek bonds as collateral for central bank loans. Greek Finance Minister Yanis Varoufakis had pleaded with ECB chairman Mario Draghi to allow Greek banks to buy $11.4 billion more in Treasury bills so that Greece is financed for a few more months. Draghi refused and deferred it to the Council of Finance Ministers of the Eurozone. If the ECB objection stands, the Greek government may ask depositors to directly buy 3- and 6-month Treasury bills, a plan very unlikely to succeed. Therefore, Greece could run out of money as soon as March.

Greece and the ECB

The enforcer

How the European Central Bank can dictate terms to the Greek government

The Economist

AS PART of his campaign to present a more conciliatory face to Greece’s European creditors, Yanis Varoufakis, the new Greek finance minister, dropped by the European Central Bank (ECB) in Frankfurt on February 4th. He met Mario Draghi, its president, in an encounter Mr Varoufakis described as “fruitful”. But there are sweet fruits and bitter ones. After his visit, the ECB’s governing council served up a bitter variety by deciding to make life tougher for Greek banks, already beset by big outflows of deposits. The decision was a warning shot to the new government over its unwillingness to abide by Greece’s bail-out arrangements.

ECB cancels soft treatment of Greek debt in warning to Athens

BY JOHN O'DONNELL AND JAN STRUPCZEWSKI

FRANKFURT/BRUSSELS Thu Feb 5, 2015 5:03am EST

(Reuters) - The European Central Bank abruptly canceled its acceptance of Greek bonds in return for funding on Wednesday, shifting the burden onto Athens' central bank to finance its lenders and isolating Greece unless it strikes a new reform deal.

The move, which means the Greek central bank will have to provide its banks with tens of billions of euros of additional emergency liquidity in the coming weeks, was a response to what many in Frankfurt see as the Greek government's abandoning of its aid-for-reform program.

Europe’s Greek Test

JAN. 30, 2015

Paul Krugman

The New York Times

In the five years (!) that have passed since the euro crisis began, clear thinking has been in notably short supply. But that fuzziness must now end. Recent events in Greece pose a fundamental challenge for Europe: Can it get past the myths and the moralizing, and deal with reality in a way that respects the Continent’s core values? If not, the whole European project — the attempt to build peace and democracy through shared prosperity — will suffer a terrible, perhaps mortal blow.

A major step towards a Greek compromise

- Finance Minister Varoufakis’s proposal provides a good basis to start discussions

by Zsolt Darvas on 3rd February 2015

 Bruegel.org

Following a week of fright after the Greek elections, during which various statements by the new Greek government have raised the spectre of Grexit, Finance Minister Varoufakis made a surprising proposal yesterday: the government will no longer call for a headline write-off of Greece’s public debt, but instead proposes to change the terms of current European loans to Greece, to aim for a primary surplus (much) smaller than the Trokia target and fight against tax evasion.

Greek Finance Minister Heads to Germany After Retreating From Tough Stance

By James Hertling

 (Bloomberg) -- Greek Finance Minister Yanis Varoufakis arrives in Germany with the wind at his back: the biggest rally in stocks since the days of the drachma and a plunge in the week-old government’s borrowing costs.

All he had to do was drop a demand for a debt writedown, retreating from a central campaign promise.

How Greece could accidentally stumble out of the euro

CNN Money

In less than four weeks the international lifeline that has kept Greece afloat for five years is due to expire. Debt repayments are looming and the country is running out of funds.

Lenders won't forgive Greece's huge debts so Prime Minister Alex Tsipras must negotiate a compromise, or put Greece's future in the eurozone at risk.

After a shaky start, his government has begun to suggest solutions. But the standoff with creditors is fueling uncertainty, shaking Greece's fragile banking system, and could tip the economy back into recession.

Syriza Shouldn't Underestimate Merkel

18 FEB 2, 2015 10:52 AM EST

By Leonid Bershidsky

Bloomberg 

It's widely assumed that the European Union will cave to Greek demands to write off some of Greece's debt. What, however, if it doesn't? A Greek exit from the euro and even the European Union is not the only alternative: The fall of the far-left Syriza government in Greece is another distinct possibility. The EU's ponderous, compromise-prone decision-making machine can be tough when challenged by mavericks -- just ask David Cameron or Plamen Oresharski.

What Is Plan B for Greece?

Kenneth Rogoff

http://www.project-syndicate.org/columnist/kenneth-rogoff

TOKYO – Financial markets have greeted the election of Greece’s new far-left government in predictable fashion. But, though the Syriza party’s victory sent Greek equities and bonds plummeting, there is little sign of contagion to other distressed countries on the eurozone periphery. Spanish ten-year bonds, for example, are still trading at interest rates below US Treasuries. The question is how long this relative calm will prevail.

Greece’s fire-breathing new government, it is generally assumed, will have little choice but to stick to its predecessor’s program of structural reform, perhaps in return for a modest relaxation of fiscal austerity. Nonetheless, the political, social, and economic dimensions of Syriza’s victory are too significant to be ignored. Indeed, it is impossible to rule out completely a hard Greek exit from the euro (“Grexit”), much less capital controls that effectively make a euro inside Greece worth less elsewhere.

France Offers Support, but No Debt Relief, to Greece

By LIZ ALDERMANFEB. 1, 2015

The New York Times

PARIS — French officials said Sunday they would support the new Greek government’s efforts to get the country back on its feet after five years of crushing austerity, but warned that there would be no write-down of Greece’s debt and pressed Athens to continue with reforms that are still needed to help mend the country’s economy.

“France is more than prepared to support Greece,” Michel Sapin, the French finance minister, said during a news conference after a two-day visit by Yanis Varoufakis, his new Greek counterpart. “Greece needs time to put things to work,” he said. But he added, there was “no question” of forgiving Greek debt.

Closed businesses in Athens. The European Central Bank will meet this week to discuss emergency loans for some Greek banks.For Greece, Bank Trouble Looms Again as New Government Takes ShapeFEB. 1, 2015

Mr. Varoufakis was beginning the first of a series of visits to European capitals this week after the leftist Syriza party won power in elections last month in a populist backlash against austerity. He said that although Athens was “desperate” for money, it would not seek a 7 billion euro installment on its 240 billion euro international bailout package because that would require the nation to adhere to austerity terms.

Economists say Greece needs the money to cover looming funding needs and debt obligations, and to help a recovery after the economy contracted around 25 percent in five years.

“We have resembled drug addicts craving the next dose. What this government is all about is ending the addiction,” Mr. Varoufakis said, adding it was time to go “cold turkey.”

President Barack Obama, in his first remarks on the situation since the Syriza government came to power, cast doubt on the soundness of Europe’s austerity policies during an interview with CNN that aired on Sunday.

“You cannot keep squeezing countries that are in the midst of a depression,” he said of Greece. “At some point, there has to be a growth strategy in order to pay off their debts and eliminate some of their deficits.”

Mr. Obama added: “More broadly I’m concerned about growth in Europe. Fiscal prudence is important, structural reforms are necessary in many of these countries. But what we’ve learnt in the U.S. experience is that the best way to reduce deficits and restore fiscal soundness is to grow.”

Europe Should Call Greece's Bluff

FEB 2, 2015 2:00 AM EST

By Guy Hands

Bloomberg

In November 2011, I hosted a dinner for senior German bankers that was dominated by heated debate over the continuing Greek financial crisis. They were adamant that Greece should not again be rescued by Germany and its European partners or the International Monetary Fund. I argued that a further bailout was the only option.

France Supports Greece in EU Debt Battle

Sympathy in Paris for Athens Adds to Pressure on Berlin

The Wall Street Journal

By MARCUS WALKER,  INTI LANDAURO and  ANDREW ACKERMAN

Updated Feb. 1, 2015 4:42 p.m. ET

8 COMMENTS

PARIS—France expressed sympathy for the new Greek government’s hope of renegotiating the tough terms of its bailout, amid growing international calls for Germany to rethink its austerity-heavy approach to the debt crises in Greece and Europe.