Greece Elections

dowie · 29 Jan 2015 at 19:06

jl10000 said:
The loss on the bonds was matched by the increase in the Greek national debt which is owed to the official creditors (tax payers). Who is paying for the bailouts? The official creditors. Who is receiving 80% of the official creditors bailout money? Private banks

75%? Total rubbish.

I think you're a bit confused....

the fact that the ECB will buy Greek debt and the EU/IMF will lend money to Greece doesn't change the fact that private banks took a 75% hit on their Greek debt holdings

Slam62 · 29 Jan 2015 at 19:09

Greece can't leave the euro or be forced to pay, they can offer to pay.

Default is not going to happen, European banks would lose too much money.

Repayment terms will be changed and Greece allowed to spend more on itself.

jl10000 · 29 Jan 2015 at 19:21

dowie said:
I think you're a bit confused....

the fact that the ECB will buy Greek debt/EU/IMF will lend money to Greece doesn't change the fact that private banks took a 75% hit on their Greek debt holdings

they took a 75% hit that is a fact, luckily they got 80% of the 400 billion euro bailout to cover the costs. I can't seem to find them announcing that on the BBC though?

Slam62 said:
Default is not going to happen, European banks would lose too much money.

Keep up at the back please

dowie · 29 Jan 2015 at 19:28

jl10000 said:
they took a 75% hit that is a fact, luckily they got 80% of the 400 billion euro bailout to cover the costs. I can't seem to find them announcing that on the BBC though?

nope, you're still confused

big commercial banks took a 75% hit on their Greek debt

80% of the bailout funds are being used for making payments on debt (the biggest holder of which is actually the ECB)

the fact that 80% of bailout funds are required to make payments on debt doesn't change the fact that banks have already taken huge losses on that debt, nor does it make up for those losses in any way, it just prevents, for the moment, future defaults on the now restructured debt

Dolph · 29 Jan 2015 at 19:28

jl10000 said:
they took a 75% hit that is a fact, luckily they got 80% of the 400 billion euro bailout to cover the costs. I can't seem to find them announcing that on the BBC though?

Keep up at the back please

The two aren't mutually exclusive. They took a 75% hit on their lendings after they got 80% of the bailout.

The bailout essentially involved an agreement where the private bond holders lost part of their investment, with the troika buying the remainder and compensating them. There was no zero sum in progress.

http://en.m.wikipedia.org/wiki/Second_Economic_Adjustment_Programme_for_Greece

jl10000 · 29 Jan 2015 at 20:51

dowie said:
nope, you're still confused

big commercial banks took a 75% hit on their Greek debt

80% of the bailout funds are being used for making payments on its debt to private banks (the biggest holder of which is actually the ECB)

the fact that 80% of bailout funds are required to make payments on debt doesn't change the fact that banks have already taken huge losses on that debt, nor does it make up for those losses in any way, it just prevents, for the moment, future defaults on the now restructured debt

The Greeks did not need 80% of its loans to 'make payments', do the math.

'Making payments' on loans to private banks and funds does not correlate with the EU taxpayer (not the ECB by the way) steadily becoming the largest holder of Greek national debt! The debt has not been paid off it has been transferred from private to public using the loans. That Greek debt is total junk and the banks and funds had to get rid of it, for the very same reason all the other banks were bailed out by the taxpayer during the banking crisis. Its no different, follow the money.

The banks lost nothing, those loans from the EU flowed straight to them straight after the debt was restructured. In a world where the new normal is for the financial sector to refuse to accept any risk, do you really believe they will take a 10 billion euro loss? I have already quoted how the money was there in the bailouts to cover the restructuring.

I can't see why they have any complaints when they're lending to a 'nation of tax evaders'? Its akin to Wonga moaning about unemployed heroin addicts defaulting on their loans.

jl10000 · 29 Jan 2015 at 21:08

Dolph said:
There was no zero sum in progress.
]

50 billion of the loans were used to recapitalise 'Greek' banks after the debt restructure, they held large amounts of the debt according to that BBC article. I suppose whether the foreign banks got paid back depends on how much you trust the financial system...

dowie · 29 Jan 2015 at 21:13

jl10000 said:
The banks lost nothing,

they lost 75%...

those loans from the EU flowed straight to them straight after the debt was restructured.

the ECB buying bonds form you after you've taken a 75% hit on them doesn't change the fact that you've taken a 75% hit, nor does Greece making payments on the newly restructured debt change that - it just means you don't take a further hit on what you're left with, for the moment at least

from the link posted by Dolph:
http://en.m.wikipedia.org/wiki/Second_Economic_Adjustment_Programme_for_Greece

On 21 February 2012, the Eurogroup finalized the second bailout package. In a thirteen-hour marathon meeting in Brussels, EU Member States agreed to a new €100 billion loan and a retroactive lowering of the bailout interest rates to a level of just 150 basis points above the Euribor. The IMF was to provide "a significant contribution" to that loan but was only to decide in the second week of March how much that will be. EU Member States would also pass on to Greece all profits which their central banks made by buying Greek bonds at a debased rate until 2020. Private investors accepted a slightly bigger haircut of 53.5% of the face value of Greek governmental bonds,[10] the equivalent to an overall loss of around 75%.

no one is compensating them for that if that is the impression you're under - the ECB buying the restructured debt from banks and lending Greece money to carry on making payments on debt doesn't change anything with regards to the 75% loss the various commercial banks have suffered on their Greek bond holdings

jl10000 · 29 Jan 2015 at 21:54

I've already quoted from an economic study on the Greek crisis regarding the "losses" by banks and funds. The idea that the private investors just accepted those losses and shrugged their shoulders is just a cheap PR trick to avoid enraging the EU taxpayer and the Greeks. Lets just ignore insurance, 50 billion of recapitalisation for the Greek banks caught short, oh and the 30 billion in 'sweeteners' gifted to the private bond holders. Not forgetting the funds who refused to restructure and wanted to foist their entire mess onto the EU taxpayer.

Forget what Barclays say on the BBC or what an EU technocrat dribbles on about, what has actually happened is the important thing. None of it supports the narrative, none of it supports anything you are saying. The holders of the debt, who is liable for any losses, where all the money went, the massive increase in debt, the state of the Greek economy and Greek public sector.

If the narrative was reality (It isn't), then it was an utter failure.

They pulled the same trick on Ireland, I think the narrative should be that they are drunk all the time and pay no tax?

dowie · 29 Jan 2015 at 22:07

It isn't a PR trick... and no they haven't just sneakily slipped a few billion to publicly traded banks... they took a 75% hit on their Greek bonds. I realise it doesn't fit your narrative of the big evil bankers but it is a fact regardless.

Iraklis F.C. · 29 Jan 2015 at 22:28

Where did all the money go?

http://www.macropolis.gr/?i=portal.en.the-agora.2080

jl10000 · 29 Jan 2015 at 22:29

dowie said:
It isn't a PR trick... and no they haven't just sneakily slipped a few billion to publicly traded banks... they took a 75% hit on their Greek bonds. I realise it doesn't fit your narrative of the big evil bankers but it is a fact regardless.

No no of course not. To suggest that a single cent of all those billions went into the wrong pockets is an utterly preposterous idea. In fact I am outraged that anybody would even suggest that a EU politician or financier would commit fraud or lie. It is quite clearly an error, that money went to help Greece, I mean look at how well they are doing! They only need to sell 400,000,000,000 more tubs of hummus to pay off the debt, god bless the EU.

Its not my narrative or my opinion, I'm just looking at what actually happened and listening to the people who weren't holding any Greek debt.

Evil bankers :confused:

Dolph · 29 Jan 2015 at 22:46

jl10000 said:
No no of course not. To suggest that a single cent of all those billions went into the wrong pockets is an utterly preposterous idea. In fact I am outraged that anybody would even suggest that a EU politician or financier would commit fraud or lie. It is quite clearly an error, that money went to help Greece, I mean look at how well they are doing! They only need to sell 400,000,000,000 more tubs of hummus to pay off the debt, god bless the EU.

Its not my narrative or my opinion, I'm just looking at what actually happened and listening to the people who weren't holding any Greek debt.

Evil bankers

When you continue to present your misconceptions as facts after the errors have been pointed out, you move from being mistaken to being wilfully dishonest, that is why your motivations are being called into question.

jl10000 · 29 Jan 2015 at 22:59

Dolph said:
When you continue to present your misconceptions as facts.

Most of those investors agreed to those losses as part of the deal, not all of them. What I do not agree with (supported by that article above my post and other studies as well) is that they did not receive any sort of compensation. Besides, they were small fry and got chucked under the bus once the big European banks were safe.

When someone claims that no bailout happened, that Greece could just default in 2011, that the EU chucked hundreds of billions at GREECE to save it. No way, that does not make any sense and does not fit in with the policy of "too big to fail" and the financial climate at the time.

dowie · 29 Jan 2015 at 23:20

jl10000 said:
Most of those investors agreed to those losses as part of the deal, not all of them. What I do not agree with (supported by that article above my post and other studies as well) is that they did not receive any sort of compensation.

OK so what do you mean by compensation - what do you think they got as compensation for their 75% loss on these Greek bonds and from whom?

jl10000 · 29 Jan 2015 at 23:29

Post 113, copy pasta from Nouriel Roubini.

Post 131.

dowie · 29 Jan 2015 at 23:37

OK so we're back to your misunderstanding again... and you can't actually answer the question.

inogen · 29 Jan 2015 at 23:44

When it comes down it, the Greeks have been lent money in order to "improve" their economy and come closer to the EU averages. Whilst that was going on, the economies that most benefited were the bigger EU economies, not Greece. The money lenders and consumer manufacturing economies are not Greek.

That this plan has failed, for whatever reasons isn't the fault of the average Greek in the street. No matter how it's dressed up (though, like Ireland, the press is fed enough to make a decent stab in that direction)

Banks, bond holders, whoever, that's the risk they took. It was them (and as individuals and companies, many of them have) trying to profit. The idea that this was in anyway ever philanthropic is laughable.

The piling on of debt, in order to meet repayments of the original debts, which they were encouraged to take is utterly gross.

dowie · 31 Jan 2015 at 12:50

inogen said:
Banks, bond holders, whoever, that's the risk they took. It was them (and as individuals and companies, many of them have) trying to profit. The idea that this was in anyway ever philanthropic is laughable.

I don't think anyone is saying it was philanthropic - private creditors were pressured into accepting a writedown voluntary, better to get at least something than nothing + a load of chaos

The piling on of debt, in order to meet repayments of the original debts, which they were encouraged to take is utterly gross.

It is what most western nations do, the UK govt issues gilts to cover its spending obligations, part of those obligations include payments to be made on the existing debt both the coupons and the principle when that debt matures.

Greece couldn't feasibly issue more bonds as they'd have a 'junk' rating so they required loans from the EU, IMF etc.. to meet their spending obligations and they need to stop running at a defect - the previous Greek regime, with austerity measures in place, got them running at a 3% surplus.

dowie · 31 Jan 2015 at 12:52

http://www.bbc.co.uk/news/world-europe-31072321

Merkel rules out further write downs:

Mrs Merkel told the Hamburger Abendblatt: "I do not envisage fresh debt cancellation."

She said: "There has already been voluntary debt forgiveness by private creditors, banks have already slashed billions from Greece's debt."

On Friday, German Finance Minister Wolfgang Schaeuble warned Greece about its negotiation tactics on writing off debt.

"There's no arguing with us about this, and what's more we are difficult to blackmail,"

doesn't look like there is much appetite in Germany to change much, yet the new Govt has decided to reverse some of the austerity measures, wonder how they expect to pay for it when the current batch of funding runs out in the next month or two...