Sunday, July 12, 2015

Warning Notice: Observing Greece Can Lead To Manic-Depression!

The Greek situation has been something like an emotional roller coaster ever since the spring of 2010 but the intensity of the roller coaster has assumed health-threatening dimensions in the last week.

First the ecstasy of a landslide referendum and then the agony of not getting any praise for it from Europe. Then early signs that Greece had no intention of seriously playing ball (going to a meeting in Brussels without a new proposal but promising it would come the next day; in other words: déjà-vu all over again...). If that was a trick, it was a good one because it made the positive surprise of suddendly seeing a proposal which the Eurogroup could not possibly object to so much greater.

In short, yesterday at this time, I thought one could soon close this miserable chapter of the last 6 months and move on to more optimistic possibilities for Greece. I was already thinking of Alexis Tsipras' stageing a rally to motivate Greeks to return their money to the banks.

Ooops, that was thinking too fast. Reviewing what has been published since last evening and throughout today, the end finally seems near. Not a positive end.

I can witness every day how this emotional roller coaster affects my Greek wife (who really is not affected at all by Greece's problems). And, more importantly, I can see how my wife's emotional roller coaster affects me even though I, neither, am affected by Greece's problems in any way. Not yet, that is to say, because a Grexit would have some impact on my Austrian taxes...

Now I think of all our relatives and friends in Greece who are definitely affected by Greece's problems. To them, this emotional roller coaster must simply be unbearable.

Europe's leading politicians, protected from the painful human reality through a wall of advisers, seem unaffected by manic-depressive feelings. If they were, they would quickly bring this situation to a close, one way or another.


  1. I have been following your comments and observations, since a colleague from Hong Kong recommended your blog. Thank you, first of all. Today, following the Tagesschau, today, I thought better to stop this, because it makes me sad. We are also not effected in any way. But I am struggling to explain to my Chinese wife, what's actually happening there. And she can't believe it. I will be using Greece as a teaching case, and for that have to follow. But I think, I give myself a break.

  2. There won't be Grexit with just Germany from the big countries favouring it. Not that Germany couldn't force if it could, but Germany dislikes being singled out as the evil, big power of Eurozone. If there was France or Italy or Spain with the same determination of Dr. Schauble for Grexit, it would have been different. But not it's Germany alone, together with its satellite countries. And Germany wouldn't like politically and for internationally image purposes to lift the weight of Grexit.
    I can still recall 3 or 4 years ago when someone would mention that Germany wants to kick Greece out of the euro, how Germans and germanophiles would have a knee-jerk reaction and deny it. I can still remember when Timothy Geithner's book came out, describing how Schauble already in 2012 wanted to kick Greece out. Reading the comments of Germans over the internet, was almost feeling an electricity shock and cursing Geithner for opening his mouth. Today the masks are off for everyone to see, in german press there are maps with Germany the leader of the "Grexit camp". And Germany will bark, but won't bite, because it's bad for german image to remain in history as the country that kicked Greece out. Because no historian will give a damn about what Finland said. Everyone knows it's about Germany.

    Not that i can blame Germany for being coherent and without patience towards Alexis Tsipras, but being cynical and realists, one can see how Germany can't insist today till the end, without another big country sharing her position.

  3. Klaus, I feel with you, your family and Greek friends. I also feel with those friendly and interesting Greek persons I happened to meet during my long traveling there in spring 2014.

    Your are quite correct to accuse Europe's leading politicians, it is a shame how all kind of politics is managed these days everywhere.

    But we also should remember how this Greek nightmare began - By criminal action of the Greek government assisted by Goldman Sachs. We find ample texts from all centuries where capable writers moralize about the consequences of wrong doing and I can't help thinking about that - also how all participants of that tragedy have taken their part of guilt.

    The Greek population has been betrayed by all governments since 2000. That adds now up to almost 15 years and the invoice therefore is no longer bearable, not for the Greeks and not for the rest of Europe.

    Imho only a temporary Grexit allows Greece to reactivate it's internal forces to realign the country to modern standards.

    This will not be easy, but those who do not recognize that such reform can only become successful when it is wanted and implemented by the Greek population live in Alices Wonderland, far away from todays realities.


    1. This point about the Goldman-affair, which is popping up here and there again, needs to be put into perspective.

      First, the way I am informed it was nothing but a cross-currency swap. EVERY bank would have loved to do such a deal with Greece but Goldman apparently convinced Greece that they were the best.
      Secondly, the amount (I heard the total was less than 5 BEUR) was negligible in the context of Greece's total debt.
      Thirdly, everyone was (and actually still is) using 'creative financing instruments' to get around Maastricht. There was nothing top-secret about that. Private-public partnerships are a standard such instrument.
      Fourth, one has to understand that the more brilliant minds the bankers have, the more rules & regulations they require. Why? Because as soon as a new rule is out, they will search for new products to circumvent that rule in a legal way.

      In short, Greece's deal was absolutely nothing out of the ordinary. As far as I know, Italy was a major user of cross-currency swaps (and rumors have it that Mario Draghi was somehow involved). Neither was Greece taken for a ride by Goldman because the Greek debt agency was staffed with excellent professionals, some of them former Goldman bankers, if I recall. They, too, knew what they were doing.

      Now to the cheating on the deficit. That is highly disputable and, at worst, it amounts to a difference of about 0,2%. It had to do with the accounting for military expenditures. See myth #1 in this article by Nick Malkoutzis:

      Did Greece's nightmare begin with the EZ-entry? I think the EZ-entry added a powerful turbo to it but the nightmare, from what I have read, really began with Andreas Papandreou's assuming power and with ND's later doing nothing other than attempting to be a (poor) copy of PASOK. By the time the Euro arrived, the Greek economy was already 'in a terminal condition', as a young professor by the name of Yanis Varoufakis described it then. You may find this essay interesting:

    2. I agree very much with what H. Trickler says.
      At the same time I am angry with all those who keep accusing Germany of wanting to kick Greece out, to punish Greece and similar stuff. The matter is much simpler: Enormous amounts of money have gone to Greece which will never come back, and people in Germany and elsewhere are understandably very reluctant to put even more money into what now clearly seems a bottomless pit. There used to be a great readiness to contribute to European integration, even if that contribution was higher than that of other countries. But now people feel cheated and exploited (and offended on top of that by the likes of Varoufakis). It is more than understandable that they are just fed up.

      If some countries (France, Italy, the UK and the US) absolutely want to keep Greece in the euro, why don't they just come up with the money?. New creditors would certainly be welcome.

    3. @kleingut - July 12, 2015 at 9:23 PM

      I did not want to make that text about criminal action too long. My verdict is based on a long (1h?) film shown on Arte and on many publications of major European experts and newspaper.

      I remember an interview with ex FinMin Waigel saying that all countries had beautified their numbers but the Greek government went beyond legal limits.

      Eurostat later said that the Greek numbers had been plain wrong also in subsequent years and that Eurostat had not realized it because they just believed it.


    4. "5 BEUR)"

      Definition of BEUR, for us nitwits?

      I stumbled across the Goldman Sachs deal too, slightly later, we all somewhat rely on Wikipedia nowadays. On the other hand it reminded me of something...

      Are the claimed returns on the deal, according to Wikipedia 21% banking standard. Or a standard under specific conditions of "insecurity" only? I am sure there is a better term among expert money handlers, if I may?

    5. "AnonymousJuly 13, 2015 at 9:46 AM"

      Ok, I would like to join you, as curious nitwit.

      "Eurostat later said that the Greek numbers had been plain wrong also in subsequent years and that Eurostat had not realized it because they just believed it."

      On the surface a politically independent ELSTAT seems obvious, but are other state institutions independent? And is there a consented rule on the respective statistics?

      On the other hand, would also like to know more about the Arte, documentary, I guess, you allude to. What was it about? I cannot believe it circled around Theo Waigel?

      "I remember an interview with ex FinMin Waigel saying that all countries had beautified their numbers but the Greek government went beyond legal limits."

      Ok Theo Waigel. thanks, I wasn't aware that Theo, is called the father of the Euro. That may have to do with plannings under Kohl. Are you Bavarian, anyway? Or are simply reminded of Waigel's resistance now?

      I see, he was against Greece entering the Eurozone. What is a lot harder to figure out now is what was the French title for the documentary,. Maybe some here are better in French then they are in German? Could be?

  4. Tsipras should accept the formation of national unity goverment. This goverment should also start a secret national plan for Grexit. This is Europe.
    Tsipras "exiled" at the angle of the table, with nobody sitting close to him. Like in a process, the accused stands alone.

    Tsipras is the man sitting at the extreme left corner, isolated like a plague-infested man... Even in the Godfather, they maintained the appearances better.

    1. He may have chosen that position so he can look everyone in the eye without significantly changing his posture.

    2. Το AnonymousJuly 13, 2015 at 1:24 AM

      Leaders in Eurogroups don't choose where they sit. This ceremonial part is handled by the bureaucracy. According to the greek media, Tsipras was surprised when he walked into the room and didn't find his name tag on the table at his "classical" position between Renzi and Hollande. This was his typical seat in all other Eurogroups. He then asked Merkel whether his seat has been changed and she replied to him "yes".

    3. @AnonymousJuly 13, 2015 at 9:21 AM

      Reminds me a bit of Putin's "offside position", imagewise, if I may, which I found a bit tasteless, without ever caring to look into context. Where was it Australia? It felt a bit like he had gotten the naughty boy treatment.

      But can we, as non-Greeks slightly hesitant of the politics of indignation, or resentment for that matter, to specify: of the misuse of our emotions for political reasons, get more details about date and precise event?

      I no doubt could use Google translate or ask the friend next door. But he is a lot better in ancient Greek then modern.

  5. Observing... Really? Didn't you mean reporting? And you even demonstrate feelings, after all? How many years did it take you to realize this? Is this a joke, Klaus? My God, what an audacity, and what a naive comment on EU politicians, from someone who is already aware. I have been reading your blog for a couple of years now; enough is enough. We don't need your "sympathy". And I got news for you:

    Warning Notice: Living in Greece During Economic Occupation Can Lead To Suicide!

    Go report this to your bosses, now.

    1. To AnonymousJuly 13, 2015 at 2:19 AM

      Don't be so harsh. It is a hobby like any other and you must take into account the nationalities involved. I keep 5 bee hives and like to observe the bees from time to time to kill time. As for the EU politicians, there is an old religious joke about this in Greece. "The 4 evangelists, were 3. The following 2: Lucas".

    2. Dear Anonymous July 13, 2.19,

      you have the courage to talk about economic occupation? Have you forgotten that the rest of Europe has been bailing out Greece to the tune of hundreds of billion euros and is set to continue doing it? Greece does not give money to Europe; Europe keeps giving money to Greece, and lots of it.
      If you do not like that sort of "occupation", leave the euro zone, please leave! We could spend our money much better than paying for corruption, clientelism and tax evasion in Greece.

    3. To: AnonymousJuly 13, 2015 at 2:19 AM:

      Don;t be so harsh on Mr. Kastner. He probably has the best opinion on Greece as a foriegner. Don't let your emotions of this agreement bring you annimosity.

      To: AnonymousJuly 13, 2015 at 1:59 PM

      This is not a place for such uneducated comments.



    4. @AnonymousJuly 13, 2015 at 2:19 AM

      "Warning Notice: Living in Greece During Economic Occupation Can Lead To Suicide!"

      Anonymous, as a German I always found it hard to deal with the "normal reality" around me.. Decades later I realized what I was obsessed with when I encountered Hannah Arendt's "banality of evil". Actually I only encountered her pretty late, but it felt she grasped the essence of my obsession over the decades....

      Thus, while pretty aware of rising suicide numbers in Greece, I have always considered this the best way out of a live on earth I never perceives as "fair", or easily "fairable" for that matter. But it feels more and more , it isn't since it never was and can't ever completely be.

      And yes, suicide for me is the ultimate option out. And I carry around the way I will do it too. I did in fact research it carefully.

  6. Dear Mr. Kastner,

    You couldn't have made a better article at any time. Emotionally we are exhausted. And even though today it seems the deal will be closed, i am still scared that there will be new hiccups which bring my hopeful mood down. In any case this needs to end because the whole of 10 million greeks are completely unproductive right now.

    1st..... Thank you for the goldman Sach comment. Although hiding a few billion wasn't the only problem. The rules of acceptance into the euro, from my viewpoint were much more relaxed back then versus the how hard they are on new entering countries. But i still would like to hang Simiti's by his feet from the acropolis.

    2nd..... The ten myths article is also a must read for everyone as to have a good opinion ont he greek issue.

    3rd..... The media has changed face in greece and suddenly pro Tsipras. Everywhere. There is a momentum and i feel they are all behind him because he has Grown very fast. (Although i still believe this all was a theatrical show.) I even saw an interview on SKAI replayed from 5 months ago. It was with the German economics professor at some German University. He is Schaubles advisor and formulated the "Time Out Strategy" of Greece. Here is a man i would listen to. A man who knew what he was talking about, although when schauble states the same views it sounds completely different.

    4th.... I read the greek proposal which will most likely be the basis of the new agreement. Personally i have calculated that i will need to payout another 2,000 annually not including the VAT hikes. Last year my family of 4 paid a total of 31,000 euro in taxes/goverment insurance(IKA)/Property Taxes this year 32,000 and next year it will be 34,000. We will soon be upon the 45% thresh hold. Something very close to what Swedes pay. But they have a very socialistic system that works. So from 2008 to 2016 which by accident i we have the same exact income as a family we have moved from 29% to 45%. (((((ROGER, you are not the only one paying for this crisis, trust me))))) How can i invest when i have no money. Loan!?! NO way and never.

    5th.... The new deal although is manditory and necessary (in some issues) is 100% recessive. And i will be bold to say not recessive but depression. At least for 2 years. Many people will go hungry if there is no humanitarian aid. I figure another 500,000 greeks will leave greece. If it is implemented successfully, after 2 years i believe things will be ok once again slowly. That is if a good debt deal is given.

    6th.... I can not help but think of last year of Germany's win over Brazil. The 7-1. How they completely destroyed Brazil and how the Brazilians even said we expected and honor that the German Players did not stop playing hard as it would be more humiliating of the German Players turned off the Gas pedal. I can't help but think of that game as a correlation to this Greek Situation. I am just wondering though after Greece is beat 7-1 will the Germans shake our hand after the game?

    I have more comments but i will wait for new news and a new article.


  7. You are dead wrong, but expect more suicides following the agreement today.

  8. Grexit is just postponed. Schauble put two poisoned apples in the deal. One will kill Tsipras as PM. The other will blow up the political system.

  9. SYRIZA's MP Manolis Glezos: "For an agreement that will not materialize. For a shameful agreement. For a coup. The trust is lost. Any trust towards "Europe" is lost. Towards "Europe" of Germany , of the "markets", of the coups, of the hard euro, of the antidemocratic institutions. History has begun. And smiles ironically to the victors of today".

  10. Wow,

    I just read some the obligations we have within this new agreement. I can't describe the chest pains i feel right now. Waiting for a new article Mr. Kastner.


  11. Hi Mr. Kastner,

    Another article that you can come up with which is concurrent is Greek Privatizations.

    Successful Examples of the Past:

    1. Olympic Airways. Now Owned by Aegean (Greek)
    2. OTE (Telecommunications) (German)
    3. Eleutherious Venizelos Airport (German)
    4. Tram And Athens Metro (French?)
    5. Attikh Odos (Roadway) (Greek)
    6. Neo Odos (Roadway) (Greek)

    I am trying to find and weigh the goods and the bads. I need to releive the weight i feel in my chest.

    In a nut shell anything run by private sector (previously run by public) runs extremely well and efficient. And although they are private companies sometimes with foreign interests i am proud of those companies as it improves Greece's image in gerenal. Meanwhile although in the respective categories some prices have gone up, but for example our road system is in perfect shape. By compariosn Athen Patra (still public) is literally a risk to your life. I pulled out some old OTE telephone bills and due to competitiveness, my bills have dropped since then.

    What I believe is that Troika wants privatizations because nobbody has the political will to fire public servants, hence privatize and let them private companies do it. Or at least restructure or re train. And become efficient.

    As i have stated again i believe energy and water should remain public. EYDAP (the water company) has performed quite well in the years of the crisis. It is probably the best greek public company. Meanwhile my bill for the last 5 years has remained nearly constant. Energy on the other hand has gotten out of control.

    As for employment laws, i am a bit scared with that. Based on the regulations of the OOSE. I do not know what is involved with that and the details on the agreement are not obvious.


    1. They still haven't fixed the Athens-Patra highway? Wow. I thought that was supposed to be complete by now. It's the one roadway that I'm really scared of.

      Thank you for pointing out some successful examples of privatization. Klaus often mentioned how he likes Cosco at the Piraeus port. Attiki Odos indeed is something to behold and well worth the toll.

      Electricity in Greece badly needs competition, so I would think that it is a prime example of where privatization could do a world of good. How on earth a country like Greece still can run on lignite when solar and wind are there for the taking, thanks to the country's geography, is beyond me. Done correctly, individual homeowners can cut their electricity bill to almost nothing or even make a net profit annually, even after factoring in loan & interest. I've complained about this 10 years ago, and still ... almost nothing. The mind boggles. IMHO, privatization of this sector is nothing to be afraid of, as long as sensible and strong regulations keep the sector from abuses, while also fostering competition.

    2. Dear AnonymousJuly 13, 2015 at 10:14 PM,

      Yes rightly put, i forgot cosco which is a huge success. I have stated ample amount of times if Trainose is sold and coupled with cosco port we can become a major port for Pan europe. For me it is the ideal first priority.

      Airports deal is closed and just needs to be released political. As the eliniko property (old airport) which can be utilized for so many uses. It is projected that it will add a full 1% point to the greek GDP.

      Athens Patra, has been privatized but for some reason the investment deal is not closed so the private company has not enforced reconstruction quickly. Up till Jan 2015 it was being constructed slowly but now it is stopped completely. I think it may have to do with TrainOSE as well, as the roadway on the Corinthian side will have train connection between athens and patra.

      As for energy. Yes my friend how ironic is it that we do not have sun panels and wind turbines all over greece. I will explain quickly. It was in past only for "clients," he who could get the permit was "connected." In 2010 Papandreou launched a campaign for solar panels. It was a huge sham by the government then. It allowed for permits for 5kw (for homes) and from 50kw to 200kw solar parks. It sparked alot interest and I myself paid and reached to acquire the home permit and paid 1100 euro. But i froze it and did not proceed finally as the whole thing smelled. ---- Within the permit and agreed price per kw electricity produced was altered by troika. Initially the prices where good and gave a ROI roughly 7-8 years on a 25 year contract with DEH. Plus it would be tax free as it was a green energy which the eu was pushing. (Meanwhile Greece fell behind on green energy requirements so had to get people involved as not to receieve penalties from the EU).

      How it ended? a Sham.

      People invested heavily and even took out loans to build parks. The price per KW was adjusted by 20% cummulatively. And 1 year later income from energy was taxed withint he total income, not even seperately. Hence had i proceed to a 17,000 euro investment I most probably get a ROI around 16-17 years. And who knows if i would break even with the changing of laws.

      People with solar parks are literly crying. They do not even get paid. Those who invested for green energy on their factories gained something from this but ther are few and far.

      What i am personally seeking to do now is to cut off DEH and go "off grid" but this is a very large investment considering batteries. And i am also waiting for new technologies to come out.

      As far as privatization of DEH, yes you are probably right, but looking at Bulgaria, our neighbor, their grid was privatized and the rates hikes went through the roof. And it did not promote competition.

      DEH is the least of my worries in privatizations. It is not a priority. Other privatizations are a priority.

      1. Ellinikos
      2. Trainose
      3. OLP (Greek Piraius and Thessaloniki commercial ports)
      4. Airports and small ports.

      Just the 4 of the above will result in a 100% increase in all levels of toursism. Low, Medium, Rich and Super Rich toursim.

      Selling off a few rock islands is also a priority. A trend to be created by billionaires who want to have their own island. Don't remeber which country in the arab nation tried to make the world island project. It has failed so far. Greece is an amazing alternative for billionaires to have their own island.

      Pangalos (of Pasok), who has been bad mouthing Tsipras for the last 6 months said yesterday, after Tsipras made the agreement, "if he passes all the structural and fiscal changes to greece, he will become the modern Harilous Trikoupi."


    3. Interesting that Pangalos would have made that comment. Since I recently read another book about Modern Greece, the name Trikoupi, the massive default of 1893 and the recovery which followed has been heavy on my mind. I recommend to those who have given up hope to reread Greek history about this period. It was (financially) more than hopeless then and yet, Greece got successfully out of it. All it takes is the right governance and the right leader. We'll see if Tsipras can rise to the historic occasion.

    4. "Electricity in Greece badly needs competition" Depends on what you mean by competition. If (like in telecom) you mean that one company (big, dum, state owned) will produce and transport energy as well as fix the network and another will be the intermediary and profit, how exactly does this help except the pockets of the intermediary company?

    5. Mr. Kastner,

      Realistically we are bankrupt and depend on life lines. So in sense we are in the first phase of the project. I and many have found new hope in Tsipras.

      I am not sure if you got a full translation of his yesterday's address but it showed true leadership.

      My concerns are not that the vote will not be yes, but what this split of Syriza will lead too. Right now Tsipras has been reborn and needs to lead the country and with brinkmanship through this new difficult deal and bring on change.

      We all hope. and it is now or never and we need as much as i can't stand him, "schauble" in enforce the deal to be followed step by step.



  12. Mr. Kastner,

    An agreement may have been made, but i see alot of open wounds. In greece and abroad. In all people of europe. You can see sides being taken. I can not understand why the general political landscape has brought us to this point.

    Ofcourse there are some logical and insane proposals being made. But where is the balance. Even here on your blog you can see the lines being drawn in the sand.

    People state Tsipras will lose his PM position. Elections or not he won't. He may have lost many voters with this move but he will definatively gain the large majority of the 40% yes vote of the referendum now.

    He will lose a large base of his votes fromt he election but he will gain from elswhere. If elections where held today we would have this result.

    1. Syriza (Tsipras) ...............................35%
    2. Potami..............................................14%
    3. ND ..................................................13%
    3. New Left Platform (Lafazanis)...........12%
    4. Golden Dawn.......................................6%
    5. ANEL....................................................6%
    5. KKE.....................................................6%
    6. Leventis................................................5%
    7. PASOK ..............................................3%

    (+/-) I see New Syriza, Potami, Anel, and hopefully PASOK if they exist and ND. To assure the reforms needed. The next government will be must for 4 years to at least see the light at the end of the tunnel in the 4th year. otherwise anything built will be destroyed by a KKE + Left Block.

    Reforms should be within the year. Although severe if everything done in one year allows for hitting the bottom of the barrel once and for all and start looking up. This will need to be backed by the eu.

    I am also wondering how easy will it be for the Merkel to pass the law in her Paliment. I think the greens and lefts of germany may vote NO as to support the left based greeks. Adding to many in the mainstream party of NO's i am wondering if it can be passed. Thoughts?



  13. In Germany I actually see three main opinion streams.
    NO - "You are to cruel to Greece, you destroyed Greece and hence Europe" on the left. The ones arguing with money, others (as I would do) arguing with democracy and lack of perspectives. You find many at "Linkspartei" and "Grüne", and some on "SPD".
    YES - "What a luck, finally we have a result with Greece inside Euro, we have saved Greece and Eurozone, but we had to be hard" - That is more in the center, parts of SPD and of CDU/CSU.
    NO - "We will waste even more money toward a hole without ground, we have lost a good chance to Grexit" on the right and Anti-Euro-side. Parts of CDU/CSU, the AfD and these guys.
    And a huge group of "Please dont bother me anymore, the mess has already cooked for too long. I dont care about results if it is not too expensive and it is calm now.
    But no side is really happy with the deal, something has broken.
    Partly at the referendum, partly yesterday.

    I suppose Merkel will get a majority again this time, but it wont be a cakewalk for CDU neither for SPD. But no comparison with Tsipras, probably.

    In my opinion yesterday Germany missed the "chance to not behave as assholes". And probably it even was not worth it.

  14. I fully expect to be reading more of the same in 2018 :sigh:

    Meantime the theatre, histrionics, and sophistry will continue.

    The only solution I see is that the EZ members exit the Euro en-masse, and write off their debts to one another.

  15. Mr. Kastner,

    What i have read today. As so somethings are clear.

    86 billion loan to greece will go to the following:
    1. 29,7 bil euro for loans to eurosystm
    2. 9,9 bil euro to the IMF
    3. 5,5 bil euro to private lonas.
    4. 25 bil euro to recapitlaize banks.
    5. 17,2 bil euro for interest.
    6. 7 bill euro for internal debt to private companies.
    7. 7,7 bil euro for the cash flow of the banking system

    Meanwhile the IMF states with the new loan the debt ratio will reach 200% by 2018.

    The guarantee of 50 bil euro, include all the projects of TAIPED. Basically, all airports, all major port, all small island ports, all of DEKO (energy, natural gas, train and transprtation), all property and buldings about 150 inanhabited islands and the final cherry on top, all petrol and natural gas deposits.

    All i can say is hmmmmmmm......

    I a made a comment the other day. Greece is a high class call girl where all her customers want her for 50 euro.


    1. If your figures are correct, the total debt of Greece won't increase that much in nominal terms because the bulk of it is for refinancing of existing debt. And really, the debt should just be ignored for a while. It won't go away by looking at it more intensively. All that matters is that the debt service burden in the budget gets as low as possible. I think here we may soon see surprises because, I read, the IMF has proposed to put a 30-year moratorium on debt service. Well, 30 years is far too long but 10 years of moratorium would translate into 10 years of having time to worry about other, more important things.

      I am going to have to digest Tsipras' interview last evening. Even though I would never have voted for him in the past, I do admit that I had fallen for his soundbites for a while. Last evening, those were not soundbites. Those were the reflections of a man who had learned a lot about the real world (as opposed to a fantasy world) in the last 6 months and who had grown from a young and spirited rebel rouser to a reflective grown-up person in only 9 days. Truly a growing-up process at the speed of light and presumably with enormous emotional strain. If I were his adviser, I would tell him: "Ok, you have been through the book 'For whom the bell tolls'. The bell tolled for you and you feel down and out. It's now time to turn to Hemingway's book 'The sun also rises'".

      Of course, this may have just been another show of Tsipras' but I am not so sure. I think there is a chance that he understands what potential role in Greece's history destiny has given him. I think there is a chance that he will rise to the occasion. It will all depend on the team he puts together to accomplish the task. I think it should be a team the core of which consists of reasonable center-left politicians/technocrates with a minor representation of the left and right just to keep thim in the loop.

      As I said, I am going to have to digest that and then I will write an article about it.

  16. According to Greek press even God is with them, his press secretary here on earth (who they don't accept as such) has told them they are right.

  17. Minister Dragasakis thanked while on radio the US goverment for its decisive intervention: "Without their help and insistence that the deal must include debt restructuring, we might have not have achieved a deal".

    At the end, you can always count on the Americans teaching reason to Germans.

  18. I very much hope that the deal outlined this Monday will not be consumed. It will only lead to years of agony and tension. None of the parties believe in the deal 18% Germans think Greece will not keep their promises, the Greek PM, who brokered the deal, call it irrational and don't believe he (Greece) can deliver. Greek politicians, who may vote for it tonight, will tomorrow claim that it was forced upon them. Blame is neither here nor there; the attitudes are not conductive to 3 years cooperation. For Greece it would mean threading water as in the last 5 years, with rearguard fights and strikes. For Europe it would mean wasting time on a minor question, time that they can ill afford.
    Schaubles offer of a Greek solution outside the EZ was equally ridiculed in Greece and Europe, most likely by people who had not read it. It is not long or difficult to understand; in fact it is the last 9 lines of a published document dated 10 July 2015 called "Comments on the latest Greek proposals". I have kept the document on my notice board in the hope that we will see it again.
    His proposals offer Greece:
    -Membership of the most privileged group in Europe, those with the benefits of EU without the obligations of EZ. (UK etc.).
    -Debt restructuring that would not break the EZ rules.
    -The total sovereignty of Greece to reform the country in their way, or not.
    -Humanitarian/technical assistance in accordance with their needs/wishes.
    His proposal offer Europe:
    -Time (not much) to create a true Economic and Monetary Union.
    -Time (not much) to create rules and laws for the governance of the union.
    Schauble hope that in 5-8-10? years the nations have agreed what sort of union they want, and who would like to participate in that union, I don't share his optimism. I do not share Schaubles vision for The European Union, neither the necessity, nor the desirability. Never the less, both parties would be better off and prepared if they follow his present proposals, be that in Schaubles union or a different.
    Please Greece, and the rest of Europe, SAY NO TO THIS HOPELESS DEAL.

  19. This is the first time that I encountered a Greek text which imho bluntly explains the basic mechanisms that led to disaster:

    Αυτός ο Έλληνας δεν μπορεί να λειτουργήσει μέσα στον δυτικό κόσμο. Η απομόνωση, η εσωστρέφεια, η πλάνη, η άγνοια, οι φαντασιώσεις, η αναζήτηση των συνθημάτων τον καθιστούν ανίκανο να συνεννοηθεί με τους άλλους.

    Γι' αυτό και δεν μπορεί να εφαρμόσει ούτε μέτρα, ούτε αποφάσεις, ούτε και συμφωνίες. Όταν μάλιστα διοικείται από ανθρώπους που αποθεώνουν τον χαρακτήρα-πρότυπο, που οι ίδιοι δημιούργησαν.

    Δεν ελπίζω πλέον σε κάτι. Μόνο στο σοκ που αναγκαστικά θα το υποστούμε οι πάντες. Και αυτοί που χρειάζονται «μάθημα» και οι υπόλοιποι που βρεθήκαμε στην ίδια αίθουσα μαζί τους. Τα ίδια ακριβά και δυσβάστακτα «δίδακτρα» θα πληρώσουμε όλοι.

    Dieser Grieche vermag in der westlichen Welt nicht zu funktionieren. Die Isolierung, die Introvertiertheit, die Irreführung, das Unwissen, die Illusionen, die Suche nach Parolen machen ihn unfähig, mit den anderen zu kommunizieren. Und deswegen vermag er auch weder Maßnahmen und Entscheidungen noch Vereinbarungen umzusetzen. Zumal, wenn er von Menschen geleitet wird, die den von ihnen selbst geschaffen Charakter-Prototyp verehren.

    Ich erwarte mittlerweile nichts mehr. Nur den Schock, den zwangsläufig alle erfahren werden. Sowohl diejenigen, die eine „Lehre“ nötig haben, als auch alle übrigen, die wir uns zusammen mit ihnen im selben Raum befanden. Wir alle werden das teure und unerträgliche „Lehrgeld“ zu bezahlen haben.


  20. 1) Since last August Greece repaid 17bn, mostly in interest and received none. It was still 5 bn short to meet payments. This was known and the plan (according to the previous program) was to get this money from the institutions ... to pay back the institutions, with a few extra measures attached. If you add that these 17bns were largely the result of an effective haircut, in the sense that via layoffs, pay cuts and extra taxes, people had to dig into their savings to pay their obligations and this money went to payment of chiefly interest. So clearly at some point if you go along this road, bank deposits evaporate and you can pay neither debt, nor interest. If I understand the objection against a debt haircut was that it is against the rules and that european taxpayers would lose their money Let's say Greece drops the demand to have a debt haircut and instead asks for an interest moratorium, so that surpluses go to service debt and not interest, at least until the debt is down to reasonable levels. I have no idea what the other side would say or if such proposals were discussed
    2)I wish the government had focused on catching a few cases or corruption(some of them possibly covered by the previous administrations-there are such clear cases but sadly even Syriza ministers have chosen to ignore them, while whistleblowers have been sued by the perpetrators) or tax evasion and exposed them as successes. This would make numbers a lot more credible. Furthermore, to escape the debt trap, one needs to produce, not merely tax and move the money from citizens to the state and eventually the creditors. There is a lot of idle capacity
    and ideas that could be tried. For instance property is largely fragmented. One might have a small piece of land, say 500 square meters, some 50 km away from your residence which is too small to exploit and only a tax burden. What about giving it to the state fro 50 years and the state sublets it to companies which can exploit it for farming, or beekeeping or whatever
    3)What about changes in the judiciary. Right now, one cannot challenge a law until one has a damage from it. But this is a huge liability which means lead on your life or invest and 'if you are right, you have no problem, if your interpretation of the law is wrong or the law is unconstitutional, well you lost big time'. And of course the same goes for troika-requested 'reforms', where the state intervened to change existing private contracts: Even if one had no immediate damage, you should know if the law is constitutional, so you can take a decision to stay, emigrate or fight it in the EU courts. Even if you are the most ardent Syriza supporter, it's hard to explain who prevented Syriza from doing these things during the last 5-6 months

  21. German taxpayers may well feel betrayed and they may well have had enough of bailouts. The same goes for greek taxpayers (and it’s amazing how myths that ‘noone pays taxes’ are advanced simultaneously with assertions that ‘Greece has too many public servants’, who along with private sector employees cannot avoid paying taxes even if they tried) who not only have to pay back money they never saw, but also get collectively described as ‘lazy, cheating and feckless’ and, at the insistence of other governments see the agreements they had with their own state voided and more power put into the hands that brought the country to this mess. So it makes no sense when on the one hand people like the vice-Chancellor speak of how the problems were not created by the present government and that Germany did nothing about corruption, nepotism, a client state etc (for which I think there are others to blame) and on the other hand misses the fact that the proposals that were rejected would increase the power of exactly these evils. For example 2/3 of the loans owned by greek banks are probably bad. Who has these loans? Not lazy, irresponsible greeks, but media moguls, casinos etc. So the troika wants to put more power into the hands of the elite ‘enterpreneurs’ that have produced debt instead of profit.

    As it is, there is a new ‘agreements’ that:
    -for germans means that taxpayers pay or risk their money so german companies profit (see privatizations)
    -for greeks means more dependency and less ability to pay back debts and of course even more qualified people leaving and even more power to the corrupt elite,
    P.S. If one pays 400 euro/month for pension and another 400 is paid by the employer for 35 years and retires at 65, how much pension should one expect to have? Of course this is not Germany’s job to provide this money, but the point is that the greek government must show it honors its commitments to its creditors by dishonoring its commitments to its own citizens. Furthermore state intervening to change existing private contracts just because a foreign company has bought the company is not especially ‘honoring agreements’, nor is this a ‘reform’.

  22. If observing Greece from the outside can lead to manic depression, LIVING in Greece can lead to cardiac arrest.

    Really unhealthy anxiety levels.

  23. Yes Jim, I know the feeling. Every day I see my Greek friends doing the tightrope act 10 meters above the ground. And every day I wonder what happens when they see that there is no rope and reality is 10 meters below them.

  24. According to Greek friends the latest bank scam goes like this. Those who don't believe in the latest deal find somebody who half believe in it and by something from them with their credit card. The transaction do not take place, instead the buyer collect an agreed percentage of the money from the seller. The going rate is 70% and dropping. Cute? That should take care of any new injection of capital in the Greek banks, it sure cancel out the capital controls.