Greek bail-out at risk — new Govt refusing to guarantee austerity

Just when you thought Greece had been pulled back from the brink:

The Greek bail-out is at risk - from the country's new Government.

As we mentioned earlier, George Karatzaferis, head of the LAOS party, and Antonis Samaras, head of the New Democracy conservatives, have both refused to put their signatures to pledges that they will implement harsh austerity measures.

That makes two out of the three parties that form the new coalition government led by former European Central Bank deputy chief Lucas Papademos.

In essence, the Government claims it intends to pass the measures, but refuses to make that promise to the EU in writing. Antonis Samaras told Papademos in parliament today:

"What additional confirmation could be needed, beyond the fact that we are voting for your administration? Do votes in Greek parliament not carry institutional and constitutional force?"

But the UE is demanding that Greece commit in writing to these austerity measures before it hands over €8 billion in bail-out cash. Without that money Greece will run out of funds in a matter of weeks.

Source

If these key leaders were intending to fulfill these demands why not sign on the dotted line? Claiming general verbal support for the new PM should suffice amounts to poorly-concealed obfuscation.

My reading of the situation overall is that behind the scenes those in the know are actively preparing for Greece to reinstate the drachma. To keep the markets in check during the time needed to address all the practical issues, the Greek PM is doing everything possible to give the impression the EU bailout and its accompanying draconian conditions are the only option on the table.

It is surely no coincidence that the EU yesterday began discussing how to muzzle European rating agencies. They know full well the (rating / financial) bloodbath that would follow break-up of the Euro:

Credit rating agencies’ freedom of expression should be restricted on “prevention of disorder” grounds, the European Commission will argue on Tuesday as it unveils controversial proposals to suspend sovereign ratings in “exceptional circumstances”.

The reform package marks the most aggressive attempt yet by Brussels to bridle an unpopular industry that some European leaders have blamed for aggravating the sovereign debt crisis with erratic and “subjective” rating decisions. However, even at this late stage, there still remain big divisions within the Commission over how powers to suspend sovereign ratings will be defined – a political disagreement EU commissioners must resolve on Tuesday morning.

Michel Barnier, the commissioner responsible for the proposal, is mounting a last-ditch attempt to increase the clout of regulators so that they can suspend any sovereign rating within the EU – a broad scope that applies to countries such as France and Italy in prescribed circumstances. But Mr Barnier, a former French foreign minister, on Monday faced a backlash from at least five other European Union commissioners – including representatives from the UK and Sweden – who are concerned that such restrictions could backfire and damage fundamental rights.

A draft of the Commission impact assessment, seen by the FT, justifies the curbs on freedom of speech as a legal measure to avoid public disorder. “One could argue that this option restricts, to some extent, the freedom of expression or information . . . of credit rating agencies. However, limitations to this are possible...”

Source: Financial Times

Join the dots: Greece will not be playing ball for much longer & all manner of chaos will inevitably be unleashed.

And now we can watch the market fall, down down down it will go, to the bottom of the black hole. So far the word is not out for the DJIA is up up up www.marketwatch.com... so when the word does get out , will it fall fall fall?

Who knows when the end will be. They take these bail outs like a dog takes a bone. If they keep doing it the whole world will be a slave to the banksters.

I wish the whole damn house of cards would just fall down so we could start over. Maybe we could learn our lesson and use currencies that actually have something real "backing" them. I doubt it though.

reply to post by DarthMuerte
you said it,"let the house of cards fall" till this happens the mess will just keep getting bigger and bigger, and the debt will go deeper and deeper til, one day it will just all fall and spare no one.

In reply to all three above: oh, it will fall. What is noticeable here is that the apparent ability of the main actors in the whole farce to maintain the status quo is seen for what it is — a ruse to keep the masses oblivious to what is really unfolding.

They just haven't got the guts to come out and say it: "Get ready for the downfall of the Euro."

It seem the market read your post OP for it fell and the market blames... european-debt-woes www.marketwatch.com... from the link

NEW YORK (MarketWatch) -- U.S. stocks posted steep declines Wednesday after a rating agency signaled trouble ahead for U.S. banks should Europe's debt trouble worsen. "Fitch said U.S. banks have manageable direct exposures to the stressed European markets, but further contagion poses a serious risk.

pardon me , while I ring my one bell for calling this one. DING DING DING would have put more dings in if they would have said Greece

reply to post by pause4thought


Oh don't be fooled, OP. The new government WILL support all austerity measures imposed from abroad. They just think it's a matter of national pride not to sign the paper, since they have already been commited to this cause by supporting it to the Greek people openly and by giving vote of confidence in the new government. To my mind, they have a point-although I support none of them. Nobody can force you to sign something you are already commited to publically, this is humiliation and they won't go for it. However, every austerity measure will pass, that's for sure. And Greece will fall. If not right now, maybe a little later, but I think it's inevitable. I can only pray that Greece will not become a third world country, with people dying in the streets from starvation. I read a statistic yesterday: 20.000 new homeless people in Greece since 2010...