GREECE: Anarchy inside the Troika

 Brussels, the European Central Bank, and the IMF are following different agendas – and it shows.

The European Central Bank has snatched Greek survival from the jaws of sovereign bankruptcy. It’s done this by securing interim financing in the form of additional emergency loans from the Bank of Greece,  Die Welt reported today (Saturday).

It’s emerged that the  ECB’s Governing Council agreed at its meeting on Thursday to increase the upper limit for the amount of Greek short-term loans the Bank of Greece can accept in exchange for emergency loans, Die Welt asserted.

Well zipperteedoo-dah what a wonderful day, but how will this meld with the euronotes that Greece is still printing (while the ECB quietly burns them on receipt) and the hard-to-ignore reality that technically, without a constant supply of Frankfurtergeld, the BoG would be insolvent itself? Nobody cares any more, for this is now the Bunker-whacky world of eurozone finance: short terms are safer than emergencies, toilet paper can bail out whole nations, and Berlin is the guarantor of last resort….except when the Bundesbank in Frankfurt suggests otherwise.

Thus, a decision made in private will have approximately a hundred times the effect of Mario Draghi publicly vowing to do Whatever it Takes – up to but not defining ‘whatever’.

However, I am here to inform you that this decision hasn’t gone down well with Christine Lagarde, Queen of the IMF. She has been stunned, I’m told, to learn that the recent transaction whereby private Bank Piraeus acquired the healthy assets of the otherwise bankrupt State Agricultural Bank of Greece (ATEBank) also involved (a) the debts of the Greek political parties being transferred to Piraeus bank at advantageous rates, and (b) the transfer of large amounts of cash (around €9m) abroad by a senior ATEBank executive during the immediate past.

What is it about elite Greek wealth, I keep on asking myself, that gives it an anti-magnetic repulsion effect causing its emigration to Zurich at the speed of Light?

But if the IMF frets about such petty-fogging details, the ECB and Brussels bigwigs are far more focused: in fact, so clear are they about objectives, a meeting about them is only a month away.

It is to take place on September 3rd (the anniversary of the outbreak of World War II) and prior to this, Luxembourg’s prime minister Jean Claude Juncker will visit Athens on August 22. Juncker will hold talks with Samaras two days before the latter will leave Athens and travel to European capitals in an effort to persuade Greece’s political lenders to grant the debt-ridden country an extension to its schedule for meeting fiscal targets. The Greek PM will meet with German Chancellor Angela Merkel in Berlin on August 24th, and French President Francois Hollande in Paris on the following day. Kissinger would’ve called this Shuttle Diplomacy, but to me it looks a lot more like Scuttle Delinquency.

However, what’s worrying Hellenic commentators in the meantime is that the Greek government keeps trying to table some “equivalent measures”…in place of ‘more tax, more axe’ – the bonkers idea that must one day trigger uncontrollable social unrest. The Troikanauts on the ground in Athens keeps on sweeping these alternatives under the table again, and plodding on in that Berlin-am-Brussels style that only they can manage. Further, they’re becoming adept at leaking to all and sundry how the Athens Coalition’s projections on tax collection are “ridiculously over-optimistic”.

So to sum up then, Mario Draghi is giving the signal that anything goes rather than having Greece default, Christine Lagarde is having an attack of moral vapours about the corrupt denialism, Troika NCOs are demanding every third firstborn in lieu, and Jean Claude Juncker is Officer in Charge of the Athens Coalition jumping through every hoop he can think of as a means of begging for mercy.

Somebody needs to explain to me why this Thing running Greece is called a Troika, as opposed to a Tricolore salad. And why you can never find some Balsamic vinegar when you need it.

But meanwhile, Tim Geithner sits quietly watching the whole ball of wool unravel. It’s all going to get increasingly interesting. Stay tuned.

35 thoughts on “GREECE: Anarchy inside the Troika

    • It was always going to be September 12th. There was no way that Greece wouldn’t get the money this month. After all, what’s a little more toilet paper cash between insolvent half witted nations.

      • so those 50 year old greek pensioners only have a little over a month left to lie on the beach and live high off the hog on german money?

        OH MY GOD! the worlds going to end!

      • Ah yes Max but by September 12th the weather will have well and truly turned. And at the moment it is far too hot to do any work.

      • W-O-W… do you guys even read this blog? You have NO idea what you are talking about. Here, have some reality.

      • What German money?… your debt per gdp is more than twice as large than Greece’s… “Moreover, that €328 billion has already been spent via various EU props. Indeed, when we account for all the backdoor schemes Germany has engaged in to prop up the EU, Germany’s REAL Debt to GDP is closer to 300%.”. From zerohedge.

        I had been posting zerohedge’s old figures which was 160% a loooong time ago… and this is his update… it’s horrible for a Greek to watch because… we’ve been through it… German politicians are lying to the people, and the world about how much they owe… eventually the truth WILL come out, and then their economy… maybe the worlds, will crash. It is exactly what our politicians did to us. See you at the beach… when you are all unemployed like we are… oh, that’s right… you don’t live in paradise… sorry.

      • @Ioannis: Watched that, thank you. It provoked me to google ‘scapegoat’ and I learned about the Greek words pharmakon and pharmakoi and the roots of pharmacy – thank you twice!

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  2. Balls of wool do not unravel. They twist themselves into an unholy mess that it is impossible ever to restore to any sort of order and everywhere you look there are knots that could not possibly have tied themselves but somehow have. Sounds very much like the EU.

    • Too true!!
      Not unlike Johnson’s famous dismissal of greek democracy before giving the go-ahead for the junta back in 1967: “Greece is to the USA as a fly to an elephant. And you know what elephants do to flies.”

      Well, actually, they ignore them.

  3. reports are coming in hot from the athletics stadium that the british have set a massive new world record for bbc commentators coming in their pants at the same time…

    but hang on a mo…there could be an official enquiry…as other television teams have complained about the performance being jessica ennis assisted…

  4. dramatic developments in the media industry…thousands of satirists have been made redundant (or have shot themselves) following the bbc commentary on mo farrar’s victory in the 10000 metres final…the decisive words of doom were alleged to have been “the british-team took on the africans and won”, but this amazing result awaits confirmation…

    …you heard it here first

    • typical blinking british journalism…not a mention about jamaicans shelly-ann fraser-pryce and veronica campbell-brown winning gold and bronze in the women’s 100m final and making a hot-dog sandwich out of american silver medal winner carmelita jeter…you see man, we jamaicans are only a small island…and we sensibly concentrate on one department of sport, sprinting, and grab as many medals there as we can…now unfortunately the olympics is a grand old celebration of euro-eccentricity and therefore deeply culturally-biased in the choice of sports on offer…and obviously we could bag a load more medals if the ancient discipline of spliff-rolling was included as an event…but i doubt whether i’ll ever see that kinda progress in my lifetime…

      • and being supposedly a ‘green’ olympics, i also think it grossly unfair that weed-growing is barred from the competition…yeah man

      • having said the above, i do really agree it’s a great pity that the olympic regulations are constituted as they are…because you see in his university days, my husband showed great form in one of the discriminatively prohibited events to which you refer, but was forced to drop his professional ambitions in that direction due to family pressure on him to take up politics…and obviously if things were different, he could have been a contender.

    • correction:

      the bbc commentator is now reported to have said of the british team: “they took on the africans, they showed them how to do it”, and we apologize for the innacuracy; it seems a pro-british mole hacked into wordpress and attempted to put some spin on the story.

  5. Shitall Todowithme is the new Shuttle Diplomacy. Far safer, in these situations, to make it up as you go along; avoids the conspiracy theory altogether. Someone remind me just how much a hundred times whatever is – not feck all by any chance? To paraphrase Ian Dury: a bit of Draghi in the claggy. This is what we find. (They must have had a funny time.. on the Golden Hind etc..)

  6. Last week Geithner was here, next week Shimon Perez is coming, and the Aegean Sea is crawling with sonar ships… NOW they decide to save us?… what a joke.

      • Their political ideal is bankcrupt. You mentioned we are a fly to an elephant in an above statement. This is an interesting analogy… however what will happen to the elephant when a fly bites it… and it gets infected?

        Surely it will probably die… We will not defeat this external menance by using the sword… rather via an economical impase… “the pen is mightier than the sword” after all.

  7. I recall an interview with Hugh Hendry where he quite bluntly stated that the problem with Greece is that it is a ‘Liars Charter’. The man has a brilliant way of summing up the nub of a problem.
    What JW describes above continues to validate that basic problem.

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  10. Pingback: John Ward – Athens Impasse : Draghi’s BoG Move Breaks Deadlock – Troika Quits Athens ‘Very Happy With Austerity Progress’ – | Lucas 2012 Infos

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