Hopes for Greece bailout deal rise sharply as Athens gives ground | Business | The Guardian


This is an excellent, must-read article from the Guardian.

via Hopes for Greece bailout deal rise sharply as Athens gives ground | Business | The Guardian..

The Guardian article seems to be a little more update than the rest of the World’s media. Concessions have finally been made by Greece on pensions and VAT – creditors are being positive and gracious. The Greek government has preserved political credibility by not agreeing cutting pensions of existing pensioners. On balance, the gap has been closed by higher taxes and levies, rather than cuts to public spending – this will make it harder for Greece’s economy to recover.

Cash is still hemorrhaging from Greek banks which are being kept on life support by the ECB. This is clearly worrying Germany, with German Finance Minister recommending capital controls for Greece.

Over the next few days, technocrats from the ECB and the IMF will pour over the detail and it is likely that Greece will gain emergency funding. However, this is all a very long way from debt write-off and recovery of Greece’s economy.

For me, there will be a serious question about the economic damage that the current Greek, hard-left, government has inflicted on Greece. Greece’s Finance Minister has warned that failure will probably mean a new hard-right government. Increasing there are protests in Athens that ordinary people want to stay in the EU.

What worries me most about the current hard-left government in Greece is their anti-business stance. There seems to be zero focus on increasing investment and creating jobs.

The devil’s in the detail. Sadly, I cannot see any easy options for the citizens of Greece.


Opinion – A programme for Greece: Follow the IMF’s research | VOX, CEPR’s Policy Portal – John Gelmini

IMF Headquarters, Washington, DC.

IMF Headquarters, Washington, DC. (Photo credit: Wikipedia)

Dr Alf brings is interesting thoughts from the IMF, all three of which, ignore the evidence of the past 70 years in my mind. The evidence is that Greece has a long record since the end of World War II of not reforming or expanding its economy, of relying on tourism, particularly from Germany, of borrowing money and never repaying it, of blaming others for their misfortunes, of not paying property and other taxes and of expecting bailouts in perpetuity.

Greece likes to scaremonger by pretending that its problems are also problems for Europe, as if they were Atlas holding up the world but threatening to drop it if their mouths are not lined with gold. Therefore it follows from that none of these IMF prescriptions for Greece’s economic salvation will work, in my view.

Greece has been told by Russia that it does not intend to buy Greek bonds and by the Chinese that they will require security.

Greece needs an efficient small government, low taxes, investment and hard-work. In addition, a fair solution is required to the debt crisis which includes write-downs. Most importantly it’s up to the people of Greece.

John Gelmini