Over a year ago, and long before he became the mascot for fraught negotiations between Greece and its creditors, Yanis Varoufakis penned a lengthy essay on what might happen should the Greek government decide to stand firm in the face of pressure from Brussels, Frankfurt, and Berlin....
Zero Hedge
"What If Berlin And Frankfurt Do Not Budge" - How Varoufakis Saw The "Worst Case Scenario"
ht Clonal
Yup. Thanks Clonal & Tom. That's what he's been saying for a long time, but few have noticed. No link here btw.
ReplyDeleteThose who call Syriza naive should confront Varoufakis's view that this worst case scenario of forced Grexit is > 50% probable. Not really worst case of course - staying in the AusterityZone is the worst case, and YV does say that occasionally. See Greece’s duty to negotiate with Berlin . See also his Times op-ed, or Greece, Germany and the Eurozone for strategy. Was wondering when he would mention Antigone until I saw the last. :-)
Thanks for the heads up, Calgacus. Link fixed now.
ReplyDeleteStill waiting for the injunction against the ECB.
ReplyDeleteHow can the ECB prevent access to ELA to banks that it has previously passed as solvent under the Single Supervisory Mechanism.
Why aren't the Greek commercial banks in court over this?
Thanks for the link. Gotta say I've been somewhat premature in my criticism of YV, but haven't had the time to dig much beyond mainstream and or Yves Smith synthesis.
ReplyDeleteNeil,
ReplyDeleteThe ECB unilaterally changed the ELA rules for Greece. I saw that documented somewhere, but I am having a hard time recollecting where I saw it. It is quite possible that he rule changes were allowed technically, but are being selectively applied.
Greece is already effectively out of ELA, out of TARGET2 and thus out of the eurozone - maybe she will be allowed to return, maybe not.
ReplyDeleteSee this excerpt from today´s Daily Telegraph:
Constantine Michalos, head of the Hellenic Chambers of Commerce, said lenders are simply running out of money. "We are reliably informed that the cash reserves of the banks are down to €500m. Anybody who thinks they are going to open again on Tuesday is day-dreaming. The cash would not last an hour," he said.
"We are in an extremely dangerous situation. Greek companies have been excluded from the electronic transfers of Europe's Target2 system. The entire Greek business community is unable to import anything, and without raw materials they can't produce anything," he said.
http://www.telegraph.co.uk/finance/economics/11714655/Greek-banks-down-to-500m-in-cash-reserves-as-economy-crashes.html