Thursday, March 23, 2017

Matthew Allen — Greece to Surrender Gold, Utilities and Real Estate in Exchange For Pieces of Paper Printed in Brussels

It’s official: The Germans will not allow debt relief for Greece. Instead, Berlin wants to send in the repo man.
The untold story of the Greek “bailouts” is that it wasn’t a “bailout” — it was an auction of Greek assets. Real, tangible things with real, tangible value were seized in exchange for pieces of paper that guarantee Athens will be chained to Berlin and Brussels for the foreseeable future.
It’s your basic extortion racket....
A bit too melodramatic? We forgot — we are supposed to use the friendly neoliberal term for this policy of national enslavement and communal suicide: “voluntary privatization.”...
Events prove Michael Hudson right again about predatory lending funneling assets from the periphery to the core. Neoliberalism implies neo-imperialism and neocolonialism.
A perfect crime. After all, Deutsche Bank and Goldman Sachs helped cook the books so Greece could join the eurozone.
This really is a golden age for international criminal cabals. Al Capone was a chump.
Defend Democracy Press
Greece to Surrender Gold, Utilities and Real Estate in Exchange For Pieces of Paper Printed in Brussels
Matthew Allen

48 comments:

Matt Franko said...

Those utilities probably need a lot of work by now... Germans have the EUR to return to Greece to invest....

The utilities will be modernized and will run more efficiently and will deliver higher quality product/services... many Greeks will remain gainfully employed there...

This is sort of what Trump has in mind for US infrastructure only without the international intrigue...

lastgreek said...

...many Greeks will remain gainfully employed there...

Sure, Matt, just like many American workers are now gainfully employed in German plants in the American South.

Inside Alabama's auto jobs boom: Low wages, little training, crushed limbs

http://www.msn.com/en-ca/money/markets/inside-alabamas-auto-jobs-boom-low-wages-little-training-crushed-limbs/ar-BByDueX?li=AAadgLE&ocid=spartandhp

Matt Franko said...

The water utilities are not a job guaranty...

This is what we should learn from "Bridgegate" in NJ...

Matt Franko said...

You have to make the argument about organizational/institutional forms of critical material systems on technical terms not political terms ...

The problem is that everything has been politicized and the US infrastructure is now in need of a lot of work and critical skills have atrophied...

The 5' tall human vagina costume brigade isn't qualified...

Matt Franko said...

There is no credible analysis from the left on the technical merits of a govt authority vs. a PPP type of institutional form ...

lastgreek said...

The 5' tall human vagina costume brigade...

If anyone here wants a visual ... (except for maybe the Muslim countries, I think it's safe for work)

http://www.revelist.com/feminism/why-dressed-up-vagina-costume/2542/theyre-selling-a-fullbody-vagina-costume-to-draw-peoples-attention-to-womens-reproductive-rights/1

Noah Way said...

Ukraine was overthrown because they didn't join the EU ... after looking at Greece why would they want to? Opening the treasury to German bankers was clearly not a good idea. But in the end it didn't matter because YOU WILL BE ASSIMILATED.

Penguin pop said...

Right Noah. You can run, but you can't hide, especially when it comes to the EU. If you refuse, get ready for military action, coups, austerity and sanctions anyway. Damned if you do, damned if you don't.

Six said...

You know who has lots of USD balances for PPP infrastructure projects? China!

GLH said...

The utilities in Greece may be updated by privatizing them but then who will benefit, the citizens or the bankers? If the Greek government would do the improvements the benefit would go to the people but the bankers will install toll booths to suck the country dry. But, that was the plan in the beginning wasn't it?

MRW said...

This is sort of what Trump has in mind for US infrastructure only without the international intrigue...

If it is, he’s an asshole.

Germans have the EUR to return to Greece to invest....

Yeah, like the Germans can speak and read Greek.

MRW said...

[Tom, I forgot to press Publish for this.]

When A bank orders currency for its vault cash, it exchanges bank reserves (settlement balances) for it at the cb.

Not it doesn’t, Tom. The banks can’t use bank reserves. Reserves move with the deposits. They can use US Treasury declared acceptable bank assets or treasury securities, but not reserves. This is spelled out in 12 USC 412: http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section412&num=0&edition=prelim

Kristjan said...

Great, at the time when Varoufakis was negotiating with EU on such an inmportant issue whether the Greece surplus should be X% or X+1% I remember a lot of leftist cucks supporting him and supporting the EU. I feel bad for Greek people but not for the leftist cucks like Coppola. Keep repeating your lines: nationalism is not an answer, Europe needs reforms etc. Even Trump is better than these leftists.

Matt Franko said...

He's not an asshole if the infrastructure operates better...

Matt Franko said...

MRW they will get RWE or Violia or Siemens to go in there and upgrade the whole system... it will be better than what they have now...

The investment the firms make in this new Greek division of their firms will help bring their current account deficit down...

Matt Franko said...

The Greek people will benefit in real terms if they have cleaner/healthier water and water treatment systems...

I dont see how anyone could be against this other than for some sort of non material identitarian/political reasons...

Andrew Anderson said...

@MRW:

To meet the demands of their customers, banks get cash from Federal Reserve Banks. Most medium- and large-sized banks maintain reserve accounts at one of the 12 regional Federal Reserve Banks, and they pay for the cash they get from the Fed by having those accounts debited. from https://www.newyorkfed.org/aboutthefed/fedpoint/fed01.html

Andrew Anderson said...
This comment has been removed by the author.
Andrew Anderson said...

They can use US Treasury declared acceptable bank assets or treasury securities, but not reserves. MRW

Yes, FRN's can be bought with bank assets - which is very handy during bank-runs - but they can also be bought with bank reserves. (See my quote above.)

Andrew Anderson said...

When A bank orders currency for its vault cash, it exchanges bank reserves (settlement balances) for it at the cb. attributed to Tom Hickey by MRW

A more accurate description of bank reserves is "fiat account balances at the central bank in the case of depository institutions." Yes, fiat account balances at the central bank are used to settle accounts between banks but they could also be used to settle accounts between CITIZENS if we were allowed to have accounts at the central bank and not forced to work through private depository institutions or be limited to mere physical fiat.

Matt Franko said...

Why have clean water in the first place?

So if you agree that we should have clean water, then the ONLY discussion to have wrt institutional form is which form will provide the most efficient and effective water systems...

All other issues are political/identitarian and have no place in the discussion...

Noah Way said...

I dont see how anyone could be against this other than for some sort of non material identitarian/political reasons...

According to this 'logic' the US should outsource infrastructure repair and ownership to foreign concerns and give away real estate to reduce debt. Debt in both Greece and the US exceeds 100% of GDP.

Matt Franko said...

No now you're making it a political issue

Bob said...

Water privatization has been a disaster every time it has been implemented. End of discussion.

miller B said...

Why would Germans invest in Greek infustrutre if Greeks have no money to make a profit off of

Tom Hickey said...

When A bank orders currency for its vault cash, it exchanges bank reserves (settlement balances) for it at the cb.

Not it doesn’t, Tom. The banks can’t use bank reserves. Reserves move with the deposits. They can use US Treasury declared acceptable bank assets or treasury securities, but not reserves. This is spelled out in 12 USC 412: http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section412&num=0&edition=prelim


Bank reserves are the balance in the bank's "reserve account" at the cb plus vault cash. MMT abbreviate the a bank's reserve balance at the cb as rb. Bank reserve = rb and vault cash.

When vault cash is withdrawn by customers it is subtracted from bank reserves and is added to M1. When customers deposit cash it is deducted from M12 and added to banks reserves as vault cash.

Banks get vault cash by exchanging rb for it at the cb, and when the return vault cash to the cb, their account at the cb is credited and their rb increases.

Rb and vault cash are bank asset of different form but denominated in the unit of account. So all this is tracked by different posting on the books of the banks and the cb.

Tom Hickey said...

@ MRW

The code is about posting collateral, not payment, as I read it.

Tom Hickey said...

He's not an asshole if the infrastructure operates better...

And government taxes away the rent extracted in the process and transfers it back into the economy for public purpose.

Tom Hickey said...

MRW they will get RWE or Violia or Siemens to go in there and upgrade the whole system... it will be better than what they have now...

The investment the firms make in this new Greek division of their firms will help bring their current account deficit down...


What will happen is that German oligarchs will own and operate the formerly Greek public resources and do a better job of it and extract rent as well as enjoy ownership of what was formerly the commons.

It's another from of "enclosure," which is fancy word for the expropriation of the commons that was the basis for feudalism and then capitalism as an iteration of feudalism.

This is the basis of Western-dominated neoliberal transnational corporatist colonization aka "globalization."

Tom Hickey said...

Checking into it, it seems that it’s the Fed that is required to post collateral with the Treasury for notes it issues, while it purchases the coins.

Each year, the Federal Reserve Board determines the need for new currency, which it purchases from the Department of the Treasury’s Bureau of Engraving and Printing (BEP) at approximately the cost of production. Our budget for the purchase of new currency for calendar-year 2006 is $494.4 million. The Reserve Banks issue Federal Reserve notes at face value, and these notes are recorded as liabilities on the Reserve Banks’ balance sheets. The Reserve Banks, as required by law, pledge collateral (principally U.S. Treasury securities) equal to the value of currency in circulation, which was approximately $762 billion as of May 31, 2006. In 2005, we returned $21.5 billion to the Treasury, primarily from earnings on securities purchased in the process of putting notes into circulation.

The Federal Reserve also provides coins to the nation’s depository institutions, but its role is somewhat different than that for currency. The United States Mint issues circulating coins that the Reserve Banks purchase at face value and record as assets on their balance sheets.1 Reserve Banks distribute coins to the banking industry through two channels. First, the Reserve Banks directly accept some coin deposits and pay out some coin orders. Second, the Reserve Banks work with armored carriers, which operate coin terminals to hold, process, and distribute coin on behalf of the Federal Reserve. The 155 coin terminals store about 65 percent of the Federal Reserve’s coin inventory and are a key focus of daily distributional activity. The value of U.S. coins in circulation as of May 31, 2006, was approximately $37 billion, or about 5 percent of total currency and coin in circulation.


https://www.federalreserve.gov/newsevents/testimony/roseman20060719a.htm

Emphasis added.

Matt Franko said...

The rent will be very small if the Greeks regulate it correctly...

If it's small it may still be better than what they have now BOTH in real and financial terms...

Tom Hickey said...

The Greek people will benefit in real terms if they have cleaner/healthier water and water treatment systems...

I dont see how anyone could be against this other than for some sort of non material identitarian/political reasons...


It's called "nationalism."

Nationalism versus globalism is what's happening now.

Trump ran as a nationalist as in "America first." Hillary ran as a liberal internationalist, i.e, a globalist.

The globalist POV is that everyone will be better off if we own and operate everything and you pay us rent on our terms.

Tom Hickey said...

Correction: "When customers deposit cash it is deducted from M12 and added to banks reserves as vault cash" above, M1 should be M1.

Fat fingers.

Andrew Anderson said...

I note Tom's correction that bank reserves include vault cash.

Matt Franko said...

Well in a PPP the US code requires Fed govt to retain 80% ownership in the deal... so govt gets 80% of "rent" to put back in the Treasury which is functionally a tax (to us)...

Private partner gets other 20% and that is true rent...

Tom Hickey said...

Well in a PPP the US code requires Fed govt to retain 80% ownership in the deal... so govt gets 80% of "rent" to put back in the Treasury which is functionally a tax (to us)...

Private partner gets other 20% and that is true rent...


What's the advantage of PPP over public ownership and funding with the federal government contracting out the admin and ops to private firms through competitive bidding, as generally occurs now?

Seems that the rationale is just to lower the deficit and debt, which we know is bogus.

Matt Franko said...

Well if it lowers the debt then it lowers savings...

Look at it this way, Warren says "it's always an unspent income story..." so what you want to do is use arrangements that reduce the amounts of unspent income within any fiscal interval the most....

Maybe a PPP is better at that...

Andrew Anderson said...

Maybe a PPP is better at that... Franko

And maybe you're a neo-liberal?

Tom Hickey said...

Look at it this way, Warren says "it's always an unspent income story..." so what you want to do is use arrangements that reduce the amounts of unspent income within any fiscal interval the most....


Only apparently so, owing to the accounting "ledgerdemain."

Matt Franko said...

"neoliberal" is a political designation...

What is the technical effect of a PPP arrangements vs others?

Tom Hickey said...

"neoliberal" is a political designation...

It the view that the market should decide (classical liberalism). What makes classical liberalism neoliberalism is recognition that the government is a factor. So neoliberalism expands on classical liberalism with the principle that when government affects markets, it should be to favor capital.

Matt Franko said...

iow I feel the left would rather have dirty water as long as it was owned by the public rather than clean water if it was 20% private owned...

I'll take the clean water period...

Bob said...

You have been drinking the tapwater, Matt, haven't you?

Matt Franko said...

Oh please look at Venezuela... total disaster... Mexico not far behind.... Brazil too..

Noah Way said...

No now you're making it a political issue

Classic dodge. Everything is a political issue, especially management of the national debt.

Six said...

"iow I feel the left would rather have dirty water as long as it was owned by the public rather than clean water if it was 20% private owned...

I'll take the clean water period..."

As always, you're arguing with positions that you made up.

Matt Franko said...

I'm not arguing I'm presenting the technical issues....

Greg said...

"Well if it lowers the debt then it lowers saving"


Matt, has this whole Trump thing rotted your brain? You know damn well that is a false statement. It might just be changing the composition of the savings portfolio from bonds held by non govt to cash held by non govt and the fed holding bonds on its balance sheet, which is what QE does.