Tuesday, May 29, 2018

Greece's Debt Profile Per March 31, 2018

Below is one of the best graphs which I have seen of late, Greece's debt profile per March 31, 2018:

The most expensive sources of financing for the Greek state are freely placed bonds and Repo's (both currently around 4%). Yet, the state seems to be in love with its two most expensive forms of financing: the famous 'return to the market' is being celebrated every other day and Repo's are treated like a permanent source of financing.

The least expensive source of financing is the ESM (a little over 1%). That's the source which Greek politicians are bragging to get rid of before long. The GLF is irrelevant for the purpose of comparing costs because it is not available for fresh money (GLF stands for Greek Loan Facility. It was the first financial support program for Greece, agreed in May 2010. It consisted of bilateral loans from euro area countries, amounting to €52.9 billion, and a €20.1 billion loan from the IMF).

There is only one argument for not taking advantage of the least expensive source of financing, and it is a political one: if freeing Greece from the shackles of foreign domination has been elevated to the most important political objective, one cannot very well continue doing business with those who allegedly had imposed the shackles in the past.

A very high price to pay for a political objective!


  1. The price of pride is never too high, provided you can pass it on to a third party.

  2. Repos = money the state manages centrally from municipalities and other state entities, effectively the cost consolidates at zero at state budget