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German blackmail. Give us your islands or leave the euro. Plain and simple.
If they did, they would forcibly take over Greece and start ww3. The volatility of the market this past week should have been a huge warning sign for everyone. The rest of July is going to be bad for the whole market and any misses during earnings season is going to really get hammered. NBG shorts are very happy
Behind Germany’s refusal to grant Greece debt relief – Op-Ed in The Guardian
Posted on July 11, 2015 by yanisv
Tomorrow’s EU Summit will seal Greece’s fate in the Eurozone. As these lines are being written, Euclid Tsakalotos, my great friend, comrade and successor as Greece’s Finance Ministry is heading for a Eurogroup meeting that will determine whether a last ditch agreement between Greece and our creditors is reached and whether this agreement contains the degree of debt relief that could render the Greek economy viable within the Euro Area. Euclid is taking with him a moderate, well-thought out debt restructuring plan that is undoubtedly in the interests both of Greece and its creditors. (Details of it I intend to publish here on Monday, once the dust has settled.) If these modest debt restructuring proposals are turned down, as the German finance minister has foreshadowed, Sunday’s EU Summit will be deciding between kicking Greece out of the Eurozone now or keeping it in for a little while longer, in a state of deepening destitution, until it leaves some time in the future. The question is: Why is the German finance Minister, Dr Wolfgang Schäuble, resisting a sensible, mild, mutually beneficial debt restructure?
Greece’s financial drama has dominated the headlines for five years for one reason: the stubborn refusal of our creditors to offer essential debt relief. Why, against common sense, against the IMF’s verdict and against the everyday practices of bankers facing stressed debtors, do they resist a debt restructure? The answer cannot be found in economics because it resides deep in Europe’s labyrinthine politics.
In 2010, the Greek state became insolvent. Two options consistent with continuing membership of the eurozone presented themselves: the sensible one, that any decent banker would recommend – restructuring the debt and reforming the economy; and the toxic option – extending new loans to a bankrupt entity while pretending that it remains solvent.
Official Europe chose the second option, putting the bailing out of French and German banks exposed to Greek public debt above Greece’s socioeconomic viability. A debt restructure would have implied losses for the bankers on their Greek debt holdings.Keen to avoid confessing to parliaments that taxpayers would have to pay again for the banks by means of unsustainable new loans, EU officials presented the Greek state’s insolvency as a problem of illiquidity, and justified the “bailout” as a case of “solidarity” with the Greeks.
To frame the cynical transfer of irretrievable private losses on to the shoulders of taxpayers as an exercise in “tough love”, record austerity was imposed on Greece, whose national income, in turn – from which new and old debts had to be repaid – diminished by more than a quarter. It takes the mathematical expertise of a smart eight-year-old to know that this process could not end well.
Once the sordid operation was complete, Europe had automatically acquired another reason for refusing to discuss debt restructuring: it would now hit the pockets of European citizens! And so increasing doses of austerity were administered while the debt grew larger, forcing creditors to extend more loans in exchange for even more austerity.
Our government was elected on a mandate to end this doom loop; to demand debt restructuring and an end to crippling austerity. Negotiations have reached their much publicised impasse for a simple reason: our creditors continue to rule out any tangible debt restructuring while insisting that our unpayable debt be repaid “parametrically” by the weakest of Greeks, their children and their grandchildren.
In my first week as minister for finance I was visited by Jeroen Dijsselbloem, president of the Eurogroup (the eurozone finance ministers), who put a stark choice to me: accept the bailout’s “logic” and drop any demands for debt restructuring or your loan agreement will “crash” – the unsaid repercussion being that Greece’s banks would be boarded up.
Five months of negotiations ensued under conditions of monetary asphyxiation and an induced bank-run supervised and administered by the European Central Bank. The writing was on the wall: unless we capitulated, we would soon be facing capital controls, quasi-functioning cash machines, a prolonged bank holiday and, ultimately, Grexit.
The threat of Grexit has had a brief rollercoaster of a history. In 2010 it put the fear of God in financiers’ hearts and minds as their banks were replete with Greek debt. Even in 2012, when Germany’s finance minister, Wolfgang Schäuble, decided that Grexit’s costs were a worthwhile “investment” as a way of disciplining France et al, the prospect continued to scare the living daylights out of almost everyone else
By the time Syriza won power last January, and as if to confirm our claim that the “bailouts” had nothing to do with rescuing Greece (and everything to do with ringfencing northern Europe), a large majority within the Eurogroup – under the tutelage of Schäuble – had adopted Grexit either as their preferred outcome or weapon of choice against our government.
Greeks, rightly, shiver at the thought of amputation from monetary union. Exiting a common currency is nothing like severing a peg, as Britain did in 1992, when Norman Lamont famously sang in the shower the morning sterling quit the European exchange rate mechanism (ERM). Alas, Greece does not have a currency whose peg with the euro can be cut. It has the euro – a foreign currency fully administered by a creditor inimical to restructuring our nation’s unsustainable debt.
To exit, we would have to create a new currency from scratch. In occupied Iraq, the introduction of new paper money took almost a year, 20 or so Boeing 747s, the mobilisation of the US military’s might, three printing firms and hundreds of trucks. In the absence of such support, Grexit would be the equivalent of announcing a large devaluation more than 18 months in advance: a recipe for liquidating all Greek capital stock and transferring it abroad by any means available.
With Grexit reinforcing the ECB-induced bank run, our attempts to put debt restructuring back on the negotiating table fell on deaf ears. Time and again we were told that this was a matter for an unspecified future that would follow the “programme’s successful completion” – a stupendous Catch-22 since the “programme” could never succeed without a debt restructure.
This weekend brings the climax of the talks as Euclid Tsakalotos, my successor, strives, again, to put the horse before the cart – to convince a hostile Eurogroup that debt restructuring is a prerequisite of success for reforming Greece, not an ex-post reward for it. Why is this so hard to get across? I see three reasons.
Europe did not know how to respond to the financial crisis. Should it prepare for an expulsion (Grexit) or a federation?
One is that institutional inertia is hard to beat. A second, that unsustainable debt gives creditors immense power over debtors – and power, as we know, corrupts even the finest. But it is the third which seems to me more pertinent and, indeed, more interesting.
The euro is a hybrid of a fixed exchange-rate regime, like the 1980s ERM, or the 1930s gold standard, and a state currency. The former relies on the fear of expulsion to hold together, while state money involves mechanisms for recycling surpluses between member states (for instance, a federal budget, common bonds). The eurozone falls between these stools – it is more than an exchange-rate regime and less than a state.
And there’s the rub. After the crisis of 2008/9, Europe didn’t know how to respond. Should it prepare the ground for at least one expulsion (that is, Grexit) to strengthen discipline? Or move to a federation? So far it has done neither, its existentialist angst forever rising. Schäuble is convinced that as things stand, he needs a Grexit to clear the air, one way or another. Suddenly, a permanently unsustainable Greek public debt, without which the risk of Grexit would fade, has acquired a new usefulness for Schauble.
What do I mean by that? Based on months of negotiation, my conviction is that the German finance minister wants Greece to be pushed out of the single currency to put the fear of God into the French and have them accept his model of a disciplinarian eurozone.
BLACKMAIL! Grexit coming.
BERLIN - Germany's Finance Ministry believes Greece's latest reform proposals do not go far enough and has suggested two alternative courses for Athens including a "timeout" from the euro zone, the Frankfurter Allgemeine Sonntagszeitung (FAS) reported.
"These proposals miss out important central reform areas to modernize the country and to bring economic growth and sustainable development over the long term," the FAS quoted the ministry as writing in a position paper.
Instead, the ministry set out two alternative courses for Greece. Under the first, Athens would improve its proposals quickly and transfer assets worth 50 billion euros ($56 billion) to a fund in order to pay down its debt.
Under the second scenario, Greece would take a "timeout" from the euro zone of at least five years and restructure its debt, while remaining a member of the European Union.
W/o unanimous agreement from all 28 eurozone members on bailout and debt relief, no deal happens and Grexit becomes a reality. Greece will be slowly booted out of the euro over the next 18 months. They'll do it responsibly but for all intents and purposes, Greece is done from the euro. Probably the best thing for Greece. Hit rock bottom as soon as possible and recover is better for them then a slow, painful death. Just my opinion.
Greece is done. Anyone who held nbg shares over the weekend has some real balls or is real stupid imo
They didn't cause the problem. They're trying to solve it and not put a band-aid on it or kick the can down the road. What yanis is doing by resigning and not voting is all symbolic. He took himself out of the equation so the world can't say he's the stumbling block. Most people agree that Greece's proposal is very adequate and very close to what was previously proposed by the creditors. Now Germany is balking at the idea that Greece caved saying it falls short of what Greece needs. Germany want Greece booted to have a disciplinarian eurozone just like yanis said and to scare the shit out of France. If Greece does indeed get booted, the elections in Spain, Portugal, and Italy will be very interesting over the next decade while Greece attempts to have a real recovery instead of this 3 year band-aid
They were sick of him because they aren't as smart as yanis and hate his personality
Shocker. Not really. Yanis nailed it
Thoughts on yanis in general and his opinion on Germany? Just curious
Brand’s inclusion on Prospect’s list did not meet with universal approval—the Guardian, for instance, said that his “presence looks designed to be provocative.” But other commentators came to his—and our—defence, with one suggesting that many of the criticisms levelled at Brand simply remind us that the “incessant demand for criticism to be ‘constructive’ is another way of defending the status quo.”
Varoufakis #2 world thinker 2015: prospect magazine
http://www.prospectmagazine.co.uk/world/world-thinkers-2015-the-results-thomas-piketty-russell-brand-revolution
Gotta take Yanis's opinion very serious.
"Based on months of negotiation, my conviction is that the German finance minister wants Greece to be pushed out of the single currency to put the fear of God into the French and have them accept his model of a disciplinarian eurozone." - Varoufakis
We'll see if he's right. Like him or not, Varoufakis is extremely intelligent
Well, Greek parliament hurdle over. Only unanimous agreement on the amount of new rescue loans and debt relief to grant Athens will allow the country to avoid full-on bankruptcy and Greek banks to reopen Monday with euros in their tills. It's all on Germany and the fins now
If Germany doesn't agree to debt relief for Greece, it's all over. Greece conceded and did their part. It's on Germany and the fins now.
Agreed. Listen to Boston and jsmooth. I wish I had. Hoping to get out soon
Is ELRA hiring? I could use a job
Me too unfortunately. Still hoping for one last spike. All elra shareholders have left is hope
I want 7s to touch!
Will vfin stay at .001?
I wish Elra would run to .002s. Doesn't sound like you think it'll run much more than a tick.
elray o/s 723,370,713 per TA
Hiring an IR company usually means HUGE news coming
Waiting on TA to reply to email.
I'll email TA for updated OS
3s up!!!!!
This info is wrong. OS under 600 million before today
DAMN! Look at the HUGE volume spike!
Something BIG in the offing IMO.
RICHARD SEVERSON of Synergy Business Consultants, LLC has a history of doing good things with tickers he's involved with in a short period of time. Hopefully he'll do the same here for ELRA
I think Goodman has something huge to announce. Hopefully something good
Something big coming soon IMO. Hopefully it's good
Why the huge drop today?
July 20th judgement day
Bitcoin is Transforming the Remittance Market Around the World
By Bitcoinist.net Jul 5, 2015
A recent article by Forbes shows that Frontline Media Publications have started accepting the fact that Bitcoin is emerging as a leading option to help remittance market not just reduce cost but increase speed as well.
Also Read: BitPesa Expands Bitcoin Remittance Service to Tanzania
The blog post says:
The global economy spent approximately $44 billion last year on fees for remittances. Remittances—money sent from one country to another—most often goes to low-income households and is proven to reduce the overall poverty of a given nation. They also come with high transaction fees and long transfer delays—significant obstacles to people trying to pull themselves out of poverty.
From the outset, it appears crystal clear that new technologies like Bitcoin can serve the purpose well for those who cannot afford to pay hefty fees charged by the traditional payment processor. The blogger writes about the existing financial infrastructure and calls it is still in pre-Internet days that prevents the currency from traveling efficiently. However, he believes digital currency protocols are especially significant for global remittances. He particularly mentions Bitcoin which is being used by some technology startups to help alleviate the cost of remittances. Bitcoin being a peer-to-peer currency that works freely on the internet, helps people transfer money at reduced charges than the traditional banking methods.
How big is Remittance Market?
Mass unemployment, the huge income gap between developed and developing or under-developed nations has created a huge number of people who look for employment opportunities other than where they live. Today, workers’ remittances are a significant part of international capital flows, especially with regard to labor-exporting countries. This news report from Business Standard says:
Remittances growth to slow sharply in 2015, as Europe and Russia stay weak; pick up expected next year. Total remittances in 2014 reached $583 billion. This is more than double the official development assistance (ODA) in the world. India received $70 billion, China $64 billion, the Philippines $28 billion. In line with the expected global economic recovery next year, the global flows of remittances are expected to accelerate by 4.1% in 2016, to reach an estimated $610 billion, rising to $636 billion in 2017. Remittance flows to developing countries are expected to recover in 2016 to reach $459 billion, rising to $479 billion in 2017.
Bitcoin is Fresh Air in the Exploitative Remittance Market
Some Bitcoin payment processing companies like Igot, Beam, BitPesa and BitX have spotted an opportunity to build Bitcoin businesses in Africa and other continents. As Forbes states:
A core cause of high fees for remittances is friction—money moves slowly and inefficiently from one country to another. Transferring money is expensive because there are limited connections between financial institutions and systems. Currently, we don’t have a neutral network to tie our disparate, siloed institutions together and move money cheaply and seamlessly.
Bitcoin can be a solution for people who may have to pay up to 10% of the total remittance. This is an exploitative system, particularly for those who are living on $2 or $3 a day.
Bitcoin's Role in Remittance Market Bitcoinist
Several Operating Models for Bitcoin Transactions
Even through digital, remittance remains deeply dependent on third parties as banks are still validating money transfers from senders to the remittance operator and again to recipients. Bitcoin allows customers have access to several operating models e.g. full Bitcoin, From Bitcoin to fiat currency, from fiat currency to fiat currency. The three different operating models that are available for customers are:
Full Bitcoin
This option is available or suitable only for those who are living in advanced/developed countries as the sender owns Bitcoins he sends to the recipient who can directly use them. The customers need to have access to e-wallets and exchange platforms like Coinbase in the US.
From Bitcoin to Fiat
This is the model that has huge prospects in the remittance market. The sender has an easy access to Bitcoins he sends to the remittance operator that sends fiat to the recipient. The fundamental assumption in this model is that developing countries have easy access to Bitcoins wallets but paying with Bitcoins is very limited especially in developing countries. The author of this story falls in this category.
From Fiat to Fiat
The sender pays its local money to the remittance operator that sends fiat to the recipient, using Bitcoins to transfer money from one currency to another.
Bitcoin is truly a game changer in the remmitence markets.
Image source: The Guardian, PixaBay
Originally posted on: Bitcoin is Transforming the Remittance Market Around the World
One of the world's biggest banks just admitted bitcoin could destroy existing finance firms
French bank BNP Paribas says the technology underpinning bitcoin has the potential to make existing companies "redundant," a huge admission from one of the world's biggest banks.
Analyst Johann Palychata writes in the company's magazine Quintessence that bitcoin's blockchain, the software that allows the digital currency to function, "should be considered as an invention like the steam or combustion engine," that has the potential to transform the world of finance and beyond.
The blockchain is an online ledger of all the bitcoin transactions that take place. It's spread across thousands of computers and servers globally.
It lets people exchange bitcoin by spreading the record of exchanges and ownership history across a wide area. It adds a layer of trust that is essential to bitcoin — everyone can check a coin hasn't been double spent and is actually owned by the person claiming to.
Palychata says that if this type of technology is applied to securities trading — the world of buying and selling company shares — then "existing industry players might be redundant."
If investors can trade shares directly with each other in a system that has a layer of trust built into it then middle men — stock brokers — aren't needed anymore.
That's a huge thing for an investment bank to say, especially one of BNP Paribas' size — it's France's biggest bank.
Most banks have been keen to play down the competition from financial technology, or fintech, startups, saying new technology presents opportunities rather than threats.
Falling technology costs and the disruption that followed the financial crisis of 2008 have lead to a wave of innovation and competition for banks. Bitcoin and the blockchain are some of the most cutting edge financial experiments we've seen.
Banks like Santander and Barclays are investing in and experimenting with financial technology of their own, saying it's a good chance to improve their own services.
But the truth — as Palychata makes clear — is these banks are being forced to innovate. While its unlikely that any one of hundreds of startups currently springing up will replace Santander or Barclays, banks face death by a thousand cuts as startups attack different parts of their businesses from multiple angels. If they don't do something soon it will start to affect the bottom line.
Palychata's scenario of blockchain being applied to stock trading isn't such an outlandish scenario either — US exchange operator Nasdaq is currently experimenting with the blockchain.
That said, Palychata's "redundant" prediction is a worst case scenario. He believes it's more likely that stock broking firms will adopt the blockchain technology to trade among themselves, rather than offer it directly to consumers.
And even if a startup or coder builds a blockchain for trading shares and opens it directly to the public, Palychata thinks the security issues around keeping private keys — the access codes used to get digital assets traded on the blockchain — means current firms could develop a new role as the guardians of these keys.
But the fact that an analyst is using the word "redundant" shows how seriously banks are taking this threat.
Read more: http://www.businessinsider.com/bnp-paribas-bitcoin-blockchain-securities-firms-redundant-2015-7#ixzz3f6cR6ly6
Bitcoin hits four-month high as Greece votes 'no' to eurozone bailout conditions
Anthony Cuthbertson By Anthony Cuthbertson
July 6, 2015 10:23 BST
A potential 'Grexit' has seen surges in value for cryptocurrencies like bitcoin and litecoin(CC)
The price of bitcoin rose to a four-month high on Sunday 5 July, as news broke that Greece had voted against the terms of an international bailout.
Bitcoin reached a peak of $273 (£175, €247) at around 6pm GMT on Sunday, according to the Coindesk Bitcoin Price Index. It was around this time that opinion polls in Greece suggested that the country had voted 'no' in the referendum.
About 60% of Greeks voted to reject eurozone cash-for-reform proposals, an outcome that several European leaders warned will result in the country leaving the eurozone – also referred to as Grexit.
Bitcoin price grexit greece euro
Bitcoin has risen in price by around $50 over the last 30 days as fears of Greece leaving the euro mount(CoinMarketCap)
Other cryptocurrencies also experienced significant surges in value, most notably litecoin. Often referred to as the silver to bitcoin's gold, litecoin rose in price by 17% over the last 24 hours. This follows a month-long trend of gains, which has seen its market cap rise from $70m to $195m in the space of just 30 days.
Cash withdrawals in Greece have been limited to €60 per day, meaning citizens are forced to turn to alternative stores of value, such as gold and cryptocurrency.
Online bitcoin and gold exchange Vaultoro reccently revealed that it had recorded a 124% increase in deposits from users with a Greek IP address.
"Some people aren't waiting for the government to figure out an exit plan and are doing it for themselves," Vaultoro founder Joshua Scigala told Reuters. "You have people worrying about their family's wealth or their life savings, and worrying that their money might be locked in banks. They'd rather hold money in a private asset like gold or bitcoin."
litecoin price bitcoin greece grexit
Litecoin's market cap has shot up by 260% in the past month(CoinMarketCap)
It is not the first time that a crisis in the eurozone has caused a spike in the price of bitcoin, coming two years after the banking collapse in Cyprus led to a tenfold increase in the price of bitcoin.
"During times of economic uncertainty, people invest in #safe havens such as gold," said Bitcoins Greece founder Elenu Varela in a recent interview with IBTimes UK.
"Nowadays, digital assets like bitcoin have joined that asset class. Because cryptocurrencies are global and do not rely on a healthy banking system, it is logical for people to stockpile them in times of uncertainty."