Posted on 02/24/2010 11:39:45 PM PST by TigerLikesRooster
Greece wants debt default guarantee
By Simon Taylor
25.02.2010 / 05:19 CET
Greece wants guarantees from other EU member states that they will not let the country default on its debt.
The Greek government is looking for an explicit guarantee from other eurozone governments that they would not allow it to default on its debts.
Greece believes that such a guarantee would help lower the cost of loans, so helping it meet its deficit reduction plans.
The Greek government needs to borrow €20 billion from the money markets in April and May to replace existing bonds that are maturing. But Greek governments bonds have to pay a yield of more than 6.54% to attract investors because of fears that Athens could default on its debt. By contrast, German benchmark ten-year bonds pay a much lower coupon of 3.1%.
(Excerpt) Read more at europeanvoice.com ...
P!
Pathetic Begging: coming soon to a nation near you. :)
That's like giving a license to Greece to go out and continue being profligate. What incentive would Greece have to behave, if someone else has already guaranteed that they'd never let Greece default on their loans?
Dear Greece,
Bust the unions. Round up the Socialists and make them go to work and Liberate your private sector. Otherwise go pound sand.
Absent a complete disclosure of exactly how much debt the Greeks have out there (including the stuff they hid with swaps), I don’t think anyone in the Euro-zone is going to take them up on this deal.
There are two huge rubs in this whole Greek debt issue:
1. The domino situation: while Greece is corrupt as hell, and has been free-spending their way into socialist collapse, they’re only the thin leading edge of a trifecta of similar economic collapse. The Italian situation is by far worse, and Spain is a dead man walking. If the Eurozone countries bail out or backstop Greece, then how are they going to say “no” to the far larger problems of Italy and Spain? And while the Germans and French could easily backstop Greece, they don’t have the money to backstop all three nations.
2. The fact that Greece (and most likely Italy) used financial engineering to deliberately hide their over-spending and indebtedness from the ECB and fellow Euro members, in direct violation of the Maastrict treaty.
At this point, the most likely outcome I see is that the IMF steps in to backstop Greece, and they impose draconian spending controls as a condition of the bailout/backstop.
Sure. Give Italy and Spain the same, so the rest of Europe can fall with them. [Little irony and sarcasm there.]
yitbos
Yep—spiralling musical chairs, or something like that.
They had strikes across the country yesterday because of the hinted cuts to come. Presently...barely fifty percent of the public agrees with the measures mentioned. That’s not enough to ensure public support. I forecast this current government will fall within 100 days, and the second by the end of 2010. Loaning them money...does nothing in this case.
Arnold is studying this situation very carefully right now. He knows he’s next in line with his hat out.
Maybe Greece should call the shysters advertising all over the radio dial for debt relief— they could cut their debt by 40% or MORE
Deuce of Clubs wants the rest of the house of cards to prop it up.
A bailout.
So countries that know how to balance their budget will be giving money to a country that doesn’t.
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