The Day The Euro Died

JUN 29, 2015 @ 12:34 PM

Frances Coppola

Forbes

On the evening of Friday June 26th, talks broke down between Greece and its creditors. The creditors had once more rejected Greece’s proposal and put forward their own version including tax and pension changes that Greece had already said it would not accept.

In the early hours of Saturday morning, June 27th, the Greek Prime Minister Alexis Tsipras announced that the people of Greece would be asked to decide whether they wished to accept the creditors’ proposal. A referendum will be held on July 5th.

How much Greece owes to international creditors

Sun Jun 28, 2015 3:02pm EDT Related: GERMANY, GREECE, IMF

BRUSSELS

Reuters

Greece, which may default on an International Monetary Fund debt repayment due on Tuesday after talks with creditors broke down, owes its official lenders 242.8 billion euros ($271 billion), according to a Reuters calculation based on official data, with Germany by far the largest creditor.

That figure includes loans made under two bailouts from European governments and the IMF since 2010 -- worth a nominal 220 billion euros so far, of which some has been repaid -- as well as Greek government bonds held by the European Central Bank and national central banks in the euro zone.

Greece Comes to a Sudden Stop. Now What?

JUN 29, 2015 2:00 AM EDT

By Mohamed A. El-Erian

Sadly, the “Graccident” has happened.

 Bloomberg

The Greek economy is now in intensive care, as its parts -- and notably its banking system -- grind to a halt. The economy that eventually comes out of intensive care will be smaller and uncomfortably different in form, but it will also have the potential to prosper over the longer term if some important decisions are made rapidly and consistently.

Greece Will Shut Banks in Fallout From Debt Crisis

By JIM YARDLEYJUNE 28, 2015

The New York Times

ATHENS — Prime Minister Alexis Tsipras announced Sunday night that Greece’s banks would be closed as of Monday, as the fallout from ruptured debt negotiations with the nation’s creditors began inflicting pain on ordinary people while raising alarm in Washington, Brussels and Berlin.

The emergency measures escalated the confused and unpredictable state of a crisis that some analysts say could ripple through global financial markets and undercut European unity. Most Asian markets opened lower on Monday.

Greece Will Close Banks to Stem Flood of Withdrawals

By LANDON THOMAS Jr. and NIKI KITSANTONISJUNE 28, 2015

New York Times

ATHENS — Greece will keep its banks and stock market closed on Monday and place restrictions on the withdrawal and transfer of money, Prime Minister Alexis Tsipras said in a televised address on Sunday night, as Athens tries to avert a financial collapse.

The government’s decision to close banks temporarily and impose other so-called capital controls came hours after the European Central Bank said it would not expand an emergency loan program that has been propping up Greek banks in recent weeks while the government was trying to reach a new debt deal with international creditors.

Euro zone readies for Greek default after Tsipras referendum call

Sat Jun 27, 2015 1:22pm EDT Related: GERMANY, GREECE

ATHENS/BRUSSELS | BY KAROLINA TAGARIS AND ROBIN EMMOTT

Reuters

The euro zone got ready to deal with a Greek debt default next week after refusing to extend credit following Prime Minister Alexis Tsipras's surprise announcement of a referendum on an offer from creditors that his leftist government rejected.

Athens asked for an extension of Greece's bailout program beyond Tuesday, the day it must pay 1.6 billion euros to the International Monetary Fund or go bust.

But the other 18 members of the euro zone unanimously rejected the request, freezing Greece out of further discussions with the European Central Bank and IMF on how to deal with the fallout from a historic breach in the EU's 16-year-old currency.

Tsipras Overturns the Chessboard

7 JUN 27, 2015 11:32 AM EDT

By Leonid Bershidsky

Bloomberg

It's difficult to imagine a decision more irrational than Prime Minister Alexis Tsipras's call for a referendum on whether Greece should accept its creditors' latest bailout proposal. Tsipras is attempting abdicate responsibility for what could have been the toughest decision of his career. One can only hope the Greek people will be more responsible on July 5, if the referendum goes ahead.

Tsipras told Greek citizens in a televised address Saturday that the creditors presented his government with an ultimatum Thursday that would add "new unbearable weight to the shoulders of the Greek people" and "undermine the recovery of the Greek economy and society -- not only by fueling uncertainty, but also by further exacerbating social inequalities." Therefore,

Greece's Choice of Disasters

34 JUN 27, 2015 10:15 AM EDT

By The Editors

Bloomberg

After months of confusion and indecision over Greece and its debts, a moment of clarity may finally be approaching. The referendum called for July 5 by Prime Minister Alexis Tsipras promises some kind of resolution. For that, at least, one should be grateful.

There is little else to celebrate. Getting to next Sunday without a financial breakdown in Greece looks impossible; Greeks are already lining up at ATMs. And the choice confronting them when they vote will be between two very bleak alternatives. This mess is a textbook case of political shortsightedness and catastrophic mismanagement.

Greek Deal or No Deal: Investors Question Which Is Worse for Euro

Months of brinkmanship have tarnished the currency’s outlook, some money managers say

The Wall Street Journal

By TOMMY STUBBINGTON

June 26, 2015 7:30 a.m. ET

10 COMMENTS

Last time Greece headed for a potential departure from the eurozone, investors dumped the euro, betting that an exit would be a disaster for the currency. This time, they’re not so sure.

Even if Athens and its creditors cobble together a last-minute deal that keeps the country in the currency bloc, some money managers say that months of fraught negotiations and political brinkmanship have tarnished the euro.

Analysis: ‘Grexit’ Isn’t the Scary Prospect It Once Was

Many of eurozone’s powers-that-be now believe any contagion could be contained

The Wall Street Journal

By MATTHEW DALTON

June 25, 2015 4:03 p.m. ET

10 COMMENTS

When Greek voters were threatening to reject the country’s bailout program in June 2012 elections, skepticism rose in the German government about whether keeping Greece in the eurozone was worth the trouble—and the money.

Europe strikes back: It seems to be trying to push Greece out of the euro

By Matt O'Brien June 25 at 3:38 PM

The Washington Post

Europe is altering the deal, and Greece better pray it doesn't alter it any further.

That, at least, was the message Europe sent with it latest bailout proposal that was really just a restatement of its original one. If Greece wants to stay in the euro, it will have to accept austerity on Europe's terms and not its own. There will be no negotiation, not anymore.

Greece's lenders set deadline, threaten 'take it or leave it' choice: FT

Published: June 25, 2015 7:05 a.m. ET

Greece's creditors gave the country's leader, Alexis Tsipras, until 11 a.m. Brussels time, or 5 a.m. Eastern Time, to deliver an acceptable plan, the Financial Times reported Thursday. If a deal is not done by then, the lenders' own proposal will be presented to the Eurogroup of eurozone finance ministers as a "take it or leave it" choice for Greece, the FT reported, citing two senior eurozone officials. "The level of frustration is so high. I don't see a deal," one official said, the FT reported. An hour after the 11 a.m. deadline, it was still uncertain whether the Greek premier had submitted a new plan for economic overhauls. However, Tsipras's meeting with leaders of the lender institutions broke up around noon Brussels time, with market participants waiting to hear the outcome of the talks. Austria's finance minister, Hans Jörg Schelling, said the Eurogroup will look at new proposals on Greece, hoping to reach a compromise before 4 p.m. Brussels time, or 10 a.m. Eastern, according to media reports. That would be just in time for the EU summit of European leaders that kicks off in the late afternoon. Schelling stated that Sunday is the final deadline to reach an agreement on Greece's bailout.

http://www.marketwatch.com/story/greeces-lenders-set-deadline-threaten-take-it-or-leave-it-choice-2015-06-25?dist=beforebell

Lack of Greek deal weighs on European stocks

Thu Jun 25, 2015 7:32am EDT Related: GREECE

LONDON | BY MARIUS ZAHARIA

Reuters

Persistent concerns of Greece leaving the euro weighed on European stocks on Thursday, with the lack of progress in negotiations on a cash-for-reform deal for Athens pushing investors towards safe-haven German Bunds.

The talks stumbled on Wednesday, with euro zone finance ministers accusing Greece of refusing to compromise ahead of a deadline next week when an International Monetary Fund loan tranche of 1.6 billion euros comes due.

Greek officials say without a deal the country does not have the money to pay the IMF. A default may trigger a bank run and may push the country out of the euro.

Creditors set bailout ultimatum for defiant Greeks: source

Jun 25, 2015 7:26am EDT Related: GREECE

BRUSSELS | BY JAN STRUPCZEWSKI AND RENEE MALTEZOU

Reurers

Greece's international creditors will put their own final proposal for a cash-for-reform deal to avert a Greek default to euro zone finance ministers for approval on Thursday after Athens let a deadline pass, euro zone officials said.

"If Greece says 'no go' now, it could be the final straw," one senior European official said.

The lenders had given leftist Prime Minister Alexis Tsipras an ultimatum to come up with a credible reform plan by mid-morning (5 a.m. EDT), saying they would otherwise send their own version to Eurogroup ministers.

Will It Be A 'Grexit', EUxt Or Just Bust For Greece?

JUN 23, 2015 @ 9:16 PM

Forbes

With Eurozone and Greek finance ministers embroiled in a crisis summit and a ‘final’ showdown yesterday, will this on-going Greek drama ever get resolved? It is amazing that the situation has persisted for so long and I’ve lost count of how many times the markets sold off before a last-minute deal was struck and a sharp rebound ensued.

While many might see these last ditch efforts – despite Greece’s latest offer on Monday constituting “some progress” according to German Chancellor Angela Merkel – is this simply yet another opportunity for more political fudging in an eleventh hour deal? There is growing concern that we now need to start preparing for the worst. This is not that Greece will finally exit out of the Euro, but about more heightened concerns that the Eurozone project could itself fail.

Europe is destroying Greece’s economy for no reason at all

The Washington Post

By Matt O'Brien June 23 at 2:32 PM

History repeats itself, first as tragedy, then as farce, and finally as trolling. That, at least, is the case in Greece, where its lenders want it to cut its pensions rather than hike its business taxes, because they're afraid those increases would, as the Financial Times's Peter Spiegel reports, "crimp economic growth."

Oh, so now they're worried that austerity hurts the economy. Too bad they weren't a little more concerned about that before it made Greece's economy shrink 25 percent.

Greece's Punishing Deal

JUN 23, 2015 9:25 AM EDT

By Marc Champion

On Monday, the Greek government put before its euro-area partners (I use the term loosely) the first serious proposal for a deal on renewing its aid package since coming to power in January. Amid the general optimism that an agreement may now be in sight, thus avoiding the uncertainties of a Greek default and exit from the euro, there was also a strain of barely suppressed fury among some of Greece's peers.

Greece Given 48 Hours to Reach Deal as EU Weighs Debt

by Mark DeenArne DelfsChristos Ziotis

June 22, 2015 — 10:29 PM EEST Updated on June 23, 2015 — 10:57 AM EEST

Bloomberg

Greek Prime Minister Alexis Tsipras has 48 hours to bring a deal with his country’s creditors to the finish line and end a five-month standoff over aid that risks splitting the euro.

After a day of marathon talks on Monday, leaders from Greece’s 18 fellow euro-zone countries agreed that Tsipras’s government was finally getting serious about striking a deal after it submitted a set of reform measures that began to converge with the terms demanded by creditors.

As the political discussions continue, the European Central Bank on Tuesday raised the limit on emergency funding available to Greek banks, according to a person familiar with the matter who asked not to be identified because the decisions are private.

Signs of last-minute Greece deal lift optimism

Mon Jun 22, 2015 4:12am EDT Related: GREECE

LONDON | BY JAMIE MCGEEVER

Reuters

Global stocks, the euro and peripheral euro zone bonds all rose on Monday, lifted by a wave of optimism that Greece and its international creditors will strike a last-minute deal that will see Athens avert default.

Greek Prime Minister Alexis Tsipras will meet the heads of the European Commission, European Central Bank and International Monetary Fund on Monday ahead of a summit of euro zone leaders later in the day aimed at reaching a deal over debt talks.

Weekend of Fear in Greece as Banks, People Live Day To Day

by Mehul SrivastavaMaria Petrakis

June 20, 2015 — 12:30 PM EEST Updated on June 21, 2015 — 11:20 AM EEST

Bloomberg

Dorothea Lambros stood outside an HSBC branch in central Athens on Friday afternoon, an envelope stuffed with cash in one hand and a 38,000 euro ($43,000) cashier’s check in the other.

She was a few minutes too late to make her deposit at the London-based bank. She was too scared to take her life-savings back to her Greek bank. She worried it wouldn’t survive the weekend.

“I don’t know what happens on Monday,” said Lambros, a 58-year-old government employee.

Nobody does. Every shifting deadline, every last-gasp effort has built up to this: a nation that went to sleep on Friday not knowing what Monday will bring. A deal, or more brinkmanship. Shuttered banks and empty cash machines, or a few more days of euros in their pockets and drachmas in their past - - and maybe their future.