Originally posted by Double Edge
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Originally posted by kato
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The Latest Bailout etc
First this is NOT a done deal; other eurozone countries have to agree this in their parliaments etc...
Nor does even the EU itself believe the latest Greek bailout will work. "A "strictly confidential" 10-page debt sustainability report commissioned for yesterday's meeting of eurozone ministers concludes that the austerity measures being foisted on Greece as a quid pro quo for a second, €130bn bailout, are quite likely to prove self-defeating, in that the austerity, by further weakening the economy, may well cause the debt to GDP ratio to rise further." Eurozone's shocking prescription for Greece – Telegraph Blogs This 'strictly confidential' report suggests that the GDP to debt ratio will expand to 165-170% in 2020. Greece will also have pass a law the guarantees that creditors (banks etc) will be payed first, so private investment is highly unlikely as you are not a 'preferred creditor'. Basicly hardly any of this 130bn euros will go to Greece but will go to the Banks who own Greek debt. If this ECB cheap credit to the Banks had solved the bank balance sheet problem, as DE suggests, it seems insufficient to shield them from a Greek default. I heard Mr Barroso giving a press conference earlier at which he was asked "What makes you think a second Greek bailout will work after the first one failed?". His reply: "People learn."
The irony... Even Mrs Merkel acknowledged recently that the first bailout hadn't been done correctly but now they have done almost exactly the same thing again, albeit with a write of about 107bn euros of debt making the real value of this deal about 240bn euros.
Greece has lost the vestige of sovereignty in this deal also with the 'troika' having an 'enforced and permanent' presence in Athens. Perhaps this is the difference between bailout 1 and 2? It is unclear if the troika will have veto powers. The two main Greek political parties have also signed up to obey the EU commisars if they form the next Government. Greece has become the first EU colony and has lost any control of it's own finances. If the Colonel is correct that ''every society is a democracy,either by ballots or by bullets'' the EU has left only the latter option open for any European who doubts the wisdom of the course they are taking in Greece. As I have argued before this contradicts very principles of democracy that are required for a country to join the EU in the first place. By these principles Greece shoud be expelled from the EU as it no longer qualifies as a democracy. Even if this is salvation for the Greek economy (which apparently they don't believe themselves) it breaks the rules required to join the EU. Those, like myself, who are sufficiently cynical to see the whole European project as another version of the USSR where our lives are run in every detail by unelected 'benign' and 'politicaly correct' commissars will suggest that the EU now has Greece exactly where they want them; dependant and compliant to all orders from Brussels. I am being alarmist and cynical you will say... maybe perhaps you can tell me how Greeks can democraticly decide not to accept 'salvation'?
Originally posted by mustavaris
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