“Grexit” Could Cause EU Collapse

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American economist Barry Eichengreen warned that the consequences of a Greek exit from the Eurozone could be devastating, and that the governments of the monetary union are taking the possible repercussions too lightly. In an interview with Die Welt am Sonntag, Eichengreen, UC Berkeley Professor of Economics, said that the consequences “would spread to other countries. When a Portuguese family or Spanish businessperson sees that Euros have been converted into drachmas, they’ll take their money out of their accounts. That could lead to a run on the banks”. Eichengreen continued that this scenario would snowball, “investors would speculate on the next candidate to leave the Eurozone”, thus endangering the entire Euro project. He also thinks that financial markets are also guilty of miscalculation, with share prices giving an overly positive picture. “My experience as an economic historian has taught me that markets always look relaxed, until suddenly… they aren’t. From the banking crisis of 2008 to the emerging markets crises of the 1990s, anybody can take their favourite financial crisis and discover that markets are really not a good crisis indicator. In the run-up to the crash, the players were always too relaxed for too long, and then later fell into a complete panic”. Eichengreen believed that the new Greek government should be given more time, “They should be given some breathing space, which is also in the interests of their creditors. I’d be in favour of tying interest payments on the borrowing to economic growth. Only when the Greek economy grows, should the country pay interest, otherwise the payments will simply be deferred. The Euro is of great symbolic and geostrategic worth for Europe”. He added that such an eventuality on the economic front would also have consequences for the West in terms of the European geostrategic situation. He observed, “The West hardly wants Russia to be able to position itself as a saviour, and become involved”, adding that this would have “dramatic consequences” for NATO.

15 February 2015

Sputnik International

http://sputniknews.com/europe/20150215/1018299307.html

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Thousands of Greeks Protest Against New Round of Austerity Cuts

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On Saturday, thousands of Greeks marched at an annual fair in Thessaloniki to protest against a new round of wage and pension cuts demanded by international lenders in exchange for aid to stave off bankruptcy. The demonstration by about 15,000 trade unionists and leftists was the first major protest against a nearly 12 billion Euro (490 billion Roubles. 15.4 billion USD. 9.6 billion UK Pounds) austerity package being readied by Prime Minister Antonis Samaras to appease EU and IMF inspectors who arrived in Athens on Friday to review Greece‘s reform (sic) progress. A few protesters burned EU flags while others threw watermelons and peaches in support of struggling farmers, but the largely-peaceful protests otherwise passed off without incident as 3,500 policemen looked on. Greece is struggling through its worst post-war economic crisis that has left nearly one in four jobless, pushed up poverty levels, and shuttered thousands of businesses.

9 September 2012

Voice of Russia World Service

http://english.ruvr.ru/2012_09_09/Thousands-of-Greeks-protest-against-new-round-of-austerity-cuts/

Editor’s Note:

Let’s not be coy… the rightwing government in Greece is readying moves to hammer the Greek working people so that the Affluent Effluent can party on unhindered and without pain. That’s exactly what Wafflin’ Willy wants to do in the USA… after all, he socks millions in overseas tax havens, increasing the tax burden on the rest of us. He doesn’t give a damn for the common weal… no Republican does. That’s what godless greed and selfishness does to people.

Orthodox people should be aware that the konvertsy are only formally Christians, as their main belief lies in godless Far Right nostrums; they believe in a nasty and cruel Social Darwinian world. You see, they’re just like all rightwingers… greedy, nasty, and self-centred. It’s why we must oppose them; we must see to it that they leave us… our souls depend on it.

BMD 

Give Greece a Break

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There’s hope that the EU will give Greece a break. Eurogroup chief Jean-Claude Juncker said that the EU would probably give Athens more time to cut its budget deficit, following the request of Greek Prime Minister Antonis Samaras. It’ll make a final decision after the publication of the report of the European Troika of creditors (The IMF, The European Central Bank, and the Eurogroup) on the Greek situation. However, Berlin doesn’t feel like making concessions to Athens.

After his meeting with Samaras, Juncker said that Greeks should understand that this is their last chance. Earlier, the Greek Prime Minister said that Greece desperately needed more time to reduce its budget deficit. Athens isn’t asking for additional money for battling the crisis, and it promises to continue to make payments on all the liabilities. Now, Athens faces the difficult task of lowering its budget deficit from the current 9 percent to almost 2.5 percent of the GDP by 2014, and the only thing that Greece is asking for is to extend this term until 2016. Samaras insists that it’s impossible to meet this goal in only two years. He says that, in the current situation, national economic growth is more important and trying to cut the deficit as soon as possible will only destroy any possibility of ensuring economic growth.

It looks like Samaras managed to convince Jean-Claude Juncker. Economist Vladimir Rozhankovsky said, “Nevertheless, this isn’t enough, because he still has to convince German Bundeskanzlerin Angela Merkel and French President François Hollande at their meeting on Friday. I don’t think that they’ll grant a deferment to Greece, even with such a cooperative Prime Minister. There’ll be strong friction with Germany, as Germany believes that a nation shouldn’t be forced into a corner. A nation should be able to breathe and to develop, even if it’s slow development. However, making concessions to someone, and letting things slide, means giving a bad example to all the rest. In this case, the Spaniards will likely ask for concessions too”.

So far, Berlin only announced small concessions and did it unofficially with a reference to a source in the government. On the official level, there’s a clash of two positions. The Social Democrats are confident that it is necessary to keep Greece in the Eurozone. Merkel’s partners in the coalition insist that all agreements must stay unchanged. Economist Sergei Khestanov said, “If Merkel makes concessions on Friday, her voters and party fellows won’t forgive her for this. The well-off countries of the EU are facing elections. Granting loans to Greece will stir discontent among the population of these countries. The elections in France showed that Merkel in Germany could expect something similar. There’s a threat of popular discontent, and it’s quite likely that Germany will stop providing aid to Greece. After that, a default in Greece won’t be long in coming”.

Khestanov believed that Greece’s withdrawal from the Eurozone should’ve happened earlier. Now, European politicians are paying the price for doing what they were told by the banks, who are the holders of the Greek debt, saying, “The sooner Greece goes bankrupt, the sooner the restoration of the economy will start. That’s why providing aid to Greece was wrong. The fact that Greece’ economy continues to fall is the most telling argument in favour of the statement that bankruptcy is the lesser of two evils for Greece”. The new deadline of Greece’s withdrawal from the Eurozone is the end of September. In September, the troika of creditors shall decide whether to grant another tranche to Greece.

23 August 2012

Polina Chernitsa

Aleksandra Dibizheva

Voice of Russia World Service

Euro Group Delays Meeting On Greek Debt

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Euro Zone finance ministers won’t gather in Brussels today as initially planned, as the Greek government hasn’t yet provided guarantees on the implementation of a raft of spending cuts it had earlier agreed with the troika of international lenders in exchange for a second bailout of 130 billion Euros (5.142 trillion Roubles. 171.3 billion USD. 109 billion UK Pounds), Jean-Claude Juncker, the Eurogroup‘s president and Luxembourg Prime Minister, said in a statement Tuesday. On Sunday night, the Greek parliament approved a near-term programme of austerity measures, which included wage and pension cuts.

15 February 2012

Voice of Russia World Service

http://english.ruvr.ru/2012/02/15/66085514.html