howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
this from the telegraph website, not looking good so far,i don't understand a lot of it maybe barry or ross could put things in lay terms?
"It's looking messy as the euro zone leaders go into lunch.
"Sherpas", top national and EU officials, have been meeting after getting a paper from last nights' Franco-German meeting at 4am. "No big new ideas like euro bonds", says one source close to the talks. "It is about bond swaps, longer maturity, lower interest rates and making what we have work."
So this is the scenario (which seems rather like a fiendishly complicated ponzi scheme to this observer):
The bank levy plan is ditched by France. The German plan of swapping Greek bonds as the current ones expire with longer, up to 30-year, low interest issues. This could raise €90bn in period up to 2019.
The deal is thought, in the European Commission version anyway, to include credit sweeteners to encourage broad private sector participation, probably some kind of euro guarantee.
ECB can live with this, reports Germany's Handelsblatt, it has been branded a "temporary default" lasting two months as eurozone bailout fund steps in with some kind of bond buy backs.
Still being discussed is how the bond buy back will work.
Hearing this: the €440bn European Financial and Stabilisation Facility will lend to Greece, which in turn will lend to banks.
The billions - up to €110bn - can be used by Greek banks to buy back bonds at current market rates, lower than original value and also to capitalise Greece's banking sector.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Howard - it looks to me like another sticking plaster fudge to me. They are still trying to avoid the fundamental economic changes within the Eurozone that would have some hope of a proper resolution.
see the link to the Lilco article I posted earlier.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
Yes, latest reports indicate it is a fudge.
They allowing are for some re-scheduling of Greek debts and are accepting some level of selective Greek default with provision for re-capitalising the banks where necessary. They are fudging the rules of the European Central Bank too in order to stop the Greeks from being expelled from the Euro as a result.
Quite simply this will not work... Another sticking plaster over a much bigger problem they are just not addressing the fundamental economic weakness of Greece and the flaws that exist in the Euro.
How long it delays the inevitable is anyone's guess but you can expect a lot more problems to come.
Typical EU disaster in the making. It certainly makes 'contagion' a lot more likely.
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
i am not sure how any joint decision can be reached when it is down to politicians of a wide selection of countries that are looking for their own interests.
they all have to please their own electorate, just givin lip service to the general good.
ms merkel still has to get approval from her parliament as have most of the others.
i have skimmed through a few reports and most have reached the conclusion that it is indeed a fudge.