Marathon is a word derived from ancient Greek, so perhaps the Debtathon in Athens should not be unexpected. But it does nevertheless set potentially disturbing precedents for what The Slog predicts is merely the first of many such mysterious negotiations before some kind of sanity returns to the lender-sovereign relationship.
My own source is closest to he/she who is keeping Reuters informed, in that while there are still many balls in the air, the general consensus among those involved is that a deal will be done, and we are now down to the tweeks and clarifications that inevitably precede those 3.50 am closures which are standard procedure in any business deal.
“The lawyers are still shuttling in and out with small changes,” says my veteran source, “But I do not see any major hold-out issues now. There may be one or two mavericks trying for that, but the mood now is or doing this thing”.
However, the Wall Street Journal doesn’t agree…and I’m not one to question the paper’s credentials on this kind of stuff.
‘The two sides had appeared to be closing in on a deal that would give creditors new bonds paying a 3.5% coupon for shorter maturities and rising to a cap of 4.6% on longer-dated bonds. The average coupon would amount to around 4%,’ the WSJ reported, ‘But people familiar with the matter said that the IMF and Germany were pushing for a lower rate, concerned that Greece’s debt wouldn’t return to sustainable levels if the average coupon on the new bonds was around 4%’.
The coupon range being quoted there is wider than The Slog’s information from last Thursday night. But given the Brussels-Berlin-Paris game is to stall on default for as long as possible, their search for such a deal makes sense: they are still pushing for an ultra-low start to keep the pot boiling. Once the key eurozone banks are suitably sandbagged, that particular Troika won’t give a crap what debt-mountain is then faced by the Greeks. There are times when the cynicism of this process beggars even my hard-bitten belief.
“We may not be able to reach a deal before Monday’s eurogroup. This is unfortunate because the finance ministers were supposed to have crucial talks on the [second] bailout loan provided there was a deal on the haircut,” a senior euro-zone government official said.
So maybe it really is going down to the wire – but I fancy this is brinkmanship. A deal will be done. There is too much for everyone to lose if it isn’t.