Bank Of Greece Pleads For Deal, Says “Uncontrollable Crisis”, “Soaring Inflation” Coming
The situation in Greece has escalated meaningfully since last week. After the IMFeffectively threw in the towel and sent its negotiating team back to Washington on Thursday, EU and Greek officials agreed to meet in Brussels over the weekend in what was billed as a last ditch effort to end a long-running impasse and salvage some manner of deal in time to allow for the disbursement of at least part of the final tranche of aid ‘due’ to Greece under its second bailout program. Talks collapsed on Sunday however as Greek PM Alexis Tsipras, under pressure from the Left Platform, refused (again) to compromise on pension reform and the VAT, which are “red lines” for both the IMF and for Syriza party hardliners.
By Monday evening it was clear that both EU officials and Syriza’s radical left were drawing up plans for capital controls and a possible euro exit with Brussels looking to Thursday’s meeting of EU finance ministers in Luxembourg for a possible breakthrough. That seems unlikely however, given that Athens is sending FinMin Yanis Varoufakis whose last Eurogroup meeting ended with his being sidelined in negotiations after putting on a performance that led his counterparts to brand him an amateur, a gambler, and a time waster. For his part, Varoufakis says no new proposal will be tabled in Luxembourg as Eurogroup meetings aren’t the place for such discussions, which is ironic because Jean-Claude Juncker said something similar not long ago when the Greeks were trying to get a deal done at the very same Eurogroup meetings.
Perhaps realizing that pinning everyone’s hopes on a Thursday breakthrough is a fool’s errand, the EU will reportedly convene a high level, emergency meeting over what we’ve suggested may be a “Lehman Weekend” for the market.
…click on the above link to read the rest of the article…
