As we await the formation of the biblical "10 Kings":
Greece is facing a full-blown banking crisis after a meeting of eurozone finance ministers broke down in acrimony and recrimination, forcing leaders to meet next week
Here’s our latest news story on the unfolding, deepening crisis in the eurozone:
Greece faces banking crisis after eurozone meeting breaks down
Greece is facing a full-blown banking crisis after a meeting of eurozone finance ministers broke down in acrimony and recrimination on Thursday evening, bringing the prospect of Greek exit from the eurozone a step nearer.
Some €2bn of deposits have been withdrawn from Greek banks so far this week – including a record €1bn yesterday – triggering fears that a breakdown in talks would spark a further flight of funds. The German leader Angela Merkel, French president François Hollande and Greek prime minister Alexis Tsipras agreed to stage an emergency EU summit on Monday as a last critical attempt to prevent Greece going bankrupt. A representative of the European Central Bank told the meeting it was unsure whether Greek banks would have the funds to be able to open on Monday.
As thousands of pro-EU protestors gathered outside the Athens parliament building, leaders of the eurozone and the International Monetary Fund aimed bitter criticism at the leftwing Greek government, accusing it of lying to its own people, misrepresenting and misleading other EU leaders, refusing to negotiate seriously, and taking Greece to the brink of catastrophe.
The Luxembourg talks broke down within an hour of discussions on the Greek crisis starting, indicating the bad blood between both sides. Christine Lagarde, the head of the IMF, said there was an urgent need for dialogue “with adults in the room”.
She added:
The ECB is going to decide tomorrow whether to extend more emergency liquidity to Greece’s banks, to allow them to cope with the outflow of deposits.
The European Central Bank told a meeting of euro zone finance ministers on Thursday that it was not sure if Greek banks, which have been suffering large daily deposit outflows, would be able to open on Monday, officials with knowledge of the talks said.
The officials said that during the closed-door meeting of the ministers on Greece, the chairman of the meeting Jeroen Dijsselbloem asked European Central Bank Executive Board member Benoit Coeure if Greek banks would be able to open tomorrow.
Coeure answered: "Tomorrow, yes. Monday, I don't know"
Banking sources said on Thursday that between Monday and Wednesday, Greeks have withdrawn around 2 billion euros from their bank accounts.
Russia is willing to consider giving financial aid to Greece, President Vladimir Putin's spokesman said Friday ahead of talks between the leaders of the two countries.
Greek Prime Minister Alexis Tsipras traveled to Russia as his country struggles to reach a deal with its creditors for new loans it needs to avoid defaulting on debt payments at the end of the month. Without the bailout, Greece could be headed for bankruptcy or an exit from the euro.
Tsipras's visit has given rise to speculation that the Greeks may be seeking Russian loans.
"If the Greeks ask for a loan then we will consider it, but they have not yet asked," Putin's spokesman, Dmitry Peskov, told The Associated Press. "We would do this because they are our partners and this is a normal practice between countries who are partners."
Deputy Prime Minister Arkady Dvorkovich also said Russia would consider a loan.
"The most important things for us are investment projects and trade with Greece. If financial support is needed, we will consider this question," he said in an interview on RT television, the Tass news agency reported.
Russia promised Greece hundreds of millions of dollars in transit payments yearly if it agreed to build the pipeline. Construction of the pipeline is expected to start next year and be completed in 2019.
Russian Energy Minister Alexander Novak said Russia and Greece would be equal partners in the project, with Russia's half owned by the state bank VEB.
Eurozone leaders are to meet on Monday in Brussels for an emergency summit to discuss Greece after talks between finance ministers broke off without agreement on Thursday evening.
"It is time to urgently discuss the situation of Greece at the highest political level," EU council president Donal Tusk said in a statement.
A few minutes earlier, at a press conference following the meeting, Eurogroup president Jeroen Dijsselbloem said that "too little progress [had] been made in the talks between the institutions and Greece and that no agreement as yet [was] in sight".
"We sent a strong signal to the Greek authorities that it is clearly up to them to submit new proposals in the coming days to fully engage with the institutions within the framework of the [Eurogroup] statement of 20 February," Dijsselbloem said, referring to the agreement to extend the bailout programme to 30 June and unblock a €7.2 billion loan in exchange for reforms.
Only eight days before the end of the programme on 30 June, when Greece also has to repay €1.6 billion to the IMF, Monday's summit could be presented as a take-it-or-leave-it discussion to Tsipras.
"We're approaching the time when the game is over," Moscovici warned.
"I appeal to the Greek government to come seriously back to the negotiating table and accept to make a reasonable compromise and avoid a completely catastrophic fate," he added.
The warnings come amid fears by the European Central Bank that Greek banks, subject to large daily deposit outflows, may not be able to open Monday.
Reuters reported that when ECB Executive Board member Benoit Coeure was asked during the eurogroup meeting if Greek banks would be able to open on Friday he answered: "Tomorrow, yes. Monday, I don't know."
There seems to be a growing willingness in the Eurozone to get this over with, to let Greece default and go from there – with all the options that this might entail. But even if a last-minute bailout agreement materializes, one thing stands out in this sea of chaotic uncertainty: Greek banks are toast.
The top four – National Bank of Greece, Piraeus Bank, Alpha Bank, and Eurobank Ergasias – account for 91% of Greek banking assets. They’ve already been bailed out twice. Their shares are penny stocks. They have two toxic problems: liquidity and solvency. Either one can topple them.
Liquidity is a problem because the Greeks have zero trust in their banks and have been yanking their euros out with increasing desperation. They won’t ever forget what happened to depositors in Cyprus. Deposits have plunged about 20% since November, to €130 billion. According to Reuters, “banking sources” said that just during the first three days of this week, Greeks have pulled €2 billion from their accounts – about €667 million a day, compared to prior weeks when they’d withdrawn €200 to €300 million a day.
“There’s a real possibility they’ll fold, not just Greece but the banks themselves,” Fitch Managing Director James Longsdon told CNBC.
And ELA, the lifeblood of Greek banks, is conditioned on two things: available collateral and solvency.
As of mid-May, there was only about “€40 billion of potentially monetizeable collateral available,” Longsdon said. Some of which has been used up by now. So this won’t last much longer.
A bank holiday would be announced over the weekend. The banks would remain closed on Monday and perhaps a few more days. Once they reopen, strict capital controls would prevent the remaining deposits from fleeing.
And just as I’m writing this, it seems to be happening in real time.
An unnamed “official” leaked to Reuters that the ECB had warned Eurozone finance ministers that it wasn’t sure if Greek banks would open on Monday:
Game over?
That rumors from an unnamed “official” are flying about, are taken seriously, are then denied, only to be “confirmed” by two unnamed officials – rather than ignored or brushed off – is a sign of just how close to the brink Greek banks and Greek debt have moved. Friday is going to be interesting for Greek banks. And this weekend may be it.
But here is the thing: the Greeks could have solved the crisis on their own, if they’d wanted to. Or did they know something that others didn’t? Read… If Greeks Did This, the Terrible Crisis Would Be Over
The Prime Minister, Alexis Tsipras, will hold talks with the Russian President
, Vladimir Putin, 12 days before Greece must either pay $1.6bn (£1bn) to the International Monetary Fund or become the first eurozone state effectively to go bust.
, Vladimir Putin, 12 days before Greece must either pay $1.6bn (£1bn) to the International Monetary Fund or become the first eurozone state effectively to go bust.
For President Putin a Greek alliance is advantageous. He has been courting leaders in other EU states as he has come under pressure from financial sanctions over his military intervention in Ukraine. Some have spoken of the possibility of a Russian “fifth column” being created in the EU, beholden to the Kremlin
sanctions over his military intervention in Ukraine. Some have spoken of the possibility of a Russian “fifth column” being created in the EU, beholden to the Kremlin
A make-or-break meeting of eurozone finance ministers in Luxembourg ended without agreement amid reports in Greece of €2bn (£1.4bn) being pulled out of bank accounts by frightened savers in the past three days.
accounts by frightened savers in the past three days.
An emergency summit of eurozone leaders has been called to convene on 22 June. Negotiations between Athens and its creditors in the IMF and the eurozone over a “cash-for-reforms” deal have broken down, leaving Greece without the resources to pay its debts at the end of the month. Speaking after talks broke down last night, the Eurogroup’s top official, Jeroen Dijsselbloem, said Greece required “politicians who are prepared to tell the truth to their people”.
Eurogroup starts with talk of Greek default
Christine Lagarde, the director of the International Monetary Fund (IMF), warned Thursday (18 June) that she would consider Greece to be default as early as 1 July if it fails to repay the IMF on 30 June.
Under IMF rules, she has 30 days to inform the board of any failure by the Greek government to repay the €1.6 billion it owes.
But Lagarde said there would be "no period of grace".
"[Greece] will be in default, it will be in arrears vis-a-vis the IMF on 1 July. But I hope it is not the case, I really do," she told reporters in Luxembourg.
A Greek default to the IMF could also lead the European Stability Mechanism (ESM), the EU emergency fund, to reclaim the money it is owed by Greece, warned ESM chief Klaus Regling.
The ESM, through its predecessor fund, the EFSF, lent €130.9 million to Greece.
A clause in the loan contact with Greece allows the ESM to be "immediately" repaid "with accrued interest".
Such a claim is unlikely, as Greece would not be in a position to pay.
A more likely move would be for the ESM to reserve its rights, meaning taking note of the default and maintaining the possibility of reclaiming the money lent to the country.
Lagarde and Regling made the comments just before a meeting of eurozone finance ministers in Luxembourg where hopes of progress between Greece and its lenders were feeble.
Diplomatic sources told EUobserver no new document was on the Eurogroup table when ministers started their meeting on Thursday (18 June) afternoon.
Greek finance minister Yanis Varoufakis said he would present "ideas … to replace costly discord with effective consensus".
But the president of the Eurogroup, Jeroen Dijsselbloem, told reporters he did "not have a lot of hope" of progress.
"[Varoufakis] likes to present things he already said in a new way," a Greek source told EUobserver, suggesting he did not come to the meeting with specific proposals.
An inconclusive outcome on Thursday evening would increase the risk of a default as it would make it more difficult to reach an agreement in time for 30 June, when the current bailout programme ends and Greece is due to repay the IMF.
A lack of progress would also increase the risk of a bank run.
According to Greek media, €1 billion was withdrawn form Greek banks on Thursday, in addition to €1 billion taken out between Monday and Wednesday.
"The situation is closely monitored, with the Bank of Greece asking Greek banks once or twice a day about it," an EU source told EUobserver.
However, imposing capital controls would be difficult as it would require a vote by the Greek parliament.
Also see:
Again a list of upcoming events
ReplyDeletehttp://themillenniumreport.com/2015/06/september-2015-the-biggest-month-of-the-millennium-2/
If one’s goal is the collapse of the economy as a means to destroy the United States, this would be an excellent covert plan.
ReplyDeletehttp://www.thecommonsenseshow.com/2015/06/19/the-un-is-planning-to-migrate-americans-from-california-followed-by-the-entire-southwest/
Closer and closer we come to the day of our Lord,,,,love your blog Scott,and love you too,,,my family loves you too☺❤
ReplyDeleteMany thanks, Linda - God Bless all of you guys :)
ReplyDelete