Greece agains Europe
I really don’t get it what’s so difficult about to understand where Greece and Europe are heading too.
– Greece GDP is about 240 milliard Euro.
– Greece debts after write offs are about 400 milliard Euro, mostly external. The interest payments are about 20 milliard Euro 8% of the GDP.
– Greece annual current account deficit is about 30 milliard Euro or 13% of the GDP. There is no way to finance this deficit unless someone is willing to give them new loan.
– All what IMF &ECB &Others are ready to do is to change the old loans for new ones, with prolonged expiration date and reduced interest rate.
The general Greek public is surprised that non of all the write offs and restructuring of loans goes to their pockets, but in contrary it increases their economic misery.
The Greek people said what they want, they want to stay in the Euro zone, and getting help to finance the 30 milliard current account deficit, (forget about the debts). As reward to Europe for letting them live their previous life, Greece will not destroy the European Union. Are the European leaders frightened? Is the remaining Greece debt too big to fall? It is annoying, but not too big.
As to Greece, it will have after the new election an extreme left-right government, with no will to make any real decisions, except of its plan to receive from Europe annually 30 milliard Euro to cover the current account deficit. If Europe doesn’t agree, it will default and stay in the Euro Zone, but without Euros to pay government employed, the pensioners, etc. To overcome the problem, the new left-right government will issue bonds called Eurodrach, with securing delayed Euro payments for four years (the life expectancy of the left+right government). The Euros, will slowly disappear from the markets and be replaced by the Eurodrachs, its rate after wild fluctuations will stabilize on 1 Euro to 3 Eurodrachs. Slowly Greece economy will return to be functioning. Finally after the new elections at 2017, a new central liberal-conservative-socialistic coalition government will be created, and will try to negotiate its return to Eurozone, that it never officially left. After long negotiation on new terms for restructuring its sovereign debt, that officially never defaulted, and a very – very long weekend, Greece, IMF and ECB will agree to write of the Greece debts to sustainable level of 120% of its GDP, subject to its voluntary withdrawal from the Euro zone. By then the Greek GDP will be 120 milliard Euro and its new dept accordingly 144 milliard Euro.
End
From → ECONOMICS, Greece, what next, MENUE
Dear Patrice, as you noticed i published at May 2012 the following prediction about Greece.
Even if written in certain form of irony, its prediction are until now quite correct. The Greek GDP fall since then by more than 20%, my prediction as a joke was 50%. Then the outcome of the elections 2.5 years ago created a stand by situation. Now in repeated election the predicted right-left government was established. But Greece’s capacity to destroy Euro-zone was reduced significantly. The banksters and their advisers”, viz;
who happily borrowed to Greece before 2010, now made a reverse policy, under the slogan, “Let’s starve, these arrogant people, who cheated us”.
It sounds crazy to hear the banksters to moralize after they almost destroyed the world economy. And no-one can tel me, they did not know what they are doing. If they would just stick to what they had learned in one of the economic courses they absorbed, they wouldn’t come out with all these urban legends about “New Economy”, etc.
I am sorry for the Greek people. They danced themselves into a new Greek tragedy called Syriza.
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Hi Eugen! Did you write this? It says “reblogged”!
We are all in the case of Greece, please read my “Hope From Greece”.
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I wrote this 2.5 years ago. So now just rebloged. Until now everything fits. Including the left-right guvernment. We are known for our capacity for prophecy. 😢
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Reblogged this on EugenR Lowy עוגן רודן and commented:
The same idea just postponed 2.5 years
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