Skip to comments.Fury in Germany after Greek referendum call
Posted on 11/01/2011 9:43:00 AM PDT by mojito
Germans expressed fury and frustration at Greek Prime Minister George Papandreou's shock decision to call a referendum on the latest aid package, with some saying the gamble would push Greece out of the euro zone.
"You can't help thinking that they should be grateful as Europe is trying to help," said Konstanze Pilge, a 26-year old student, walking near the Brandenburg Gate in central Berlin. "Now it looks like they are going to mess things up."
Papandreou dropped his bombshell on Monday evening, less than a week after European leaders agreed the outlines of a second bailout for Athens.
"It just goes to show once again what a huge mistake it was not to throw Greece out of the euro zone at the start," said Wolfgang Gerke, a banking professor and president of the Bavarian Financial Centre think tank.
Europe's paymaster Germany and its partners in the euro zone were taken by surprise by the announcement.
(Excerpt) Read more at reuters.com ...
Never turn your back on a Greek.
"Don't make us come back over there."
:-| (serious, stoic and perhaps a little stern non-emoticon)
Maybe the Greeks can burn some more cars & demand more government welfare!
I say let em collapse. Then the rugged individualists will survive and the parasites will die.
I’m still trying to figure out why the Euros don’t just flush Greece down the toilet?
Maybe its the “own the bank” issue?
Have the Germans and the French leave the EU. Let the rest burn down.
Except the real possibility of a war, this whole thing is funny.
The truth is that a single European monetary system won't work unless there is a single European power to oversee it, and that power would ultimately have to be held by force.
The Euro may be nothing more than a Northern European currency (France, Germany, Scandinavia, and the Benelux countries) within a decade.
It’s likely either a vote or anarchy/revolution.
If you keep giving an irresponsible crack addict more crack, they will continue to behave irresponsibly. Talk about moral hazard. Greece has no reason to behave in a financially prudent way because every time they announce more financial problems, they get more handouts.
>Im still trying to figure out why the Euros dont just >flush Greece down the toilet? Maybe its the own the bank >issue?
The problem is that many German and French banks are up to their eyeballs in Greek debt (and Italian, and Portugese, and Spanish, etc). They are afraid of a couple things:
A) Having their banks take a huge hit if(when) the Greek bonds go into default.
B) A supposed ‘contagion’ of the problem spreading to the other PIIGS (Portugal, Ireland, Italy, Greece, Spain).
It actually is starting to look like the Irish have managed to dig themselves out, but the rest of the PIIGS are still in deep doo doo.
There is another rather sneakier reason that the Germans have put up with this nonsense- the PIIGS are keeping the Euro down as a currency, and this helps German exports. However this gimmick is likely to be pretty inconsequential if all the banks go to hell.
Really the only rational response is to simply chuck the Greeks out of the EU and let them sink or swim. The former is the probably outcome.
Timeo Danaos et dona ferentes?
It is call derivatives and other leveraged financial tools invented by US Wall Street that is screwing up the situation. Greece’s GDP is a small fraction of the EU. The entire EU can absorb Greece bonds if Greece defaults. Problem is the derivatives are leveraged at ratios of 40 or more to 1. Thus for every Greek dollar, the derivative holder can lose 40+. Furthermore in the past derivatives were never traded in an open market with full transparency. So up to this day no one knows how big this market is. Estimates range from 55 trillion to 1.5 quadrillion. No one knows who owns how many. Many EU investment banks and firms play with derivatives. That is why ECB, IMF, US banks, US Fed Reserve, US Treasury, every EU finance ministry, major banks and etc cannot afford Greek default.
Oh man, the Greeks are sooooo screwing over Europe
“It is call derivatives and other leveraged financial tools invented by US Wall Street that is screwing up the situation.”
That is exactly right.