Greece fulfills its commitments for cuts on flexible spendings
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Together with Pasok party and the Democratic Left, a small party that won only 16 percent of the vote, Mr. Samaras forms a New Government.
Mr. Samaras had supported the bailout. After the May elections, in which New Democracy and Pasok suffered a drubbing while Syriza made big gains, Mr. Samaras has said he will seek to soften the deal’s terms; but soon, Mr. Samaras will be forced to make massive spending cuts to carry out the country’s “obligations” according to the Memorandum…
Syriza party stated it will fight if the new government does not repudiate the most onerous terms of Greece’s loan deals.
Meanwhile, the departmental finance minister George Zanias will represent Greece at the meeting of Eurogroup on Thursday, and Ecofin on Friday. Mr. Zanias will ask the Finance Ministers of the Euro zone for a time extension of two years to reduce the deficit (until 2016).
Prime Minister Antonis Samaras
Ministry of Interior
Minister: Euripides Stylianidis
Undersecretary: Charalambos Athanassiou (former president of the Judges Association)
In his article in "Financial Times Deutschland", the famous economist Nouriel Roubini, who had predicted the global recession of 2008 in 2006, says that either this year or the next, Greece will be forced to go bankrupt and leave the eurozone. This will happen even if a government will finally be formed after the elections of June.
Mr. Roubini says that Greece has fallen into a vicious cycle of bankruptcy, lack of competitiveness and continuous recession.
When George Papandreou, the former Greek premier who negotiated the original bailout (2010) he asked Angela Merkel for gentler conditions in the memorandum. Angela Merkel replied that the aid program must be very hard (!): "We want to make sure nobody else will want this..." she said.
After Greece's May 6 elections results, more elections are likely in June, with no guarantee that a stable government will emerge. Greece's growing turmoil is the culmination of a radical austerity experiment and a botched economic overhaul that pushed the Greek nation into a social and political breakdown. It is obvious that forcing deep austerity on Greek people won't save the euro...
Within the framework of the second memorandum in June, we expect new measures required by the Troika.
The Center for Economic Research of Greece, at the behest of the government, wrote the report contained in government expenditure intended to drastically cut.
Interventions of the measures of June include the following areas:
Education - Reduction in salary of kindergarten teachers, teachers, high school professors and academics, possibly with a parallel increase in their working hours.
Student March in Memory of the Glorious Day, in 1821, when the Greek Revolution began for Emancipation from the Ottoman Empire. Nowadays, a Greek "empire" has enslaved the Greek People.
In the worst possible time, a new government dispute comes: Prior to the vote for Greece Minister of Internal Affairs Friedrich talks about Athens' farewell to the euro. The opposition frothed while Merkel puts her foot down.
Up until today, two statements of the German Euro Policy seemed to be carved in stone: 1) Greece remains in Euro-Zone no matter what and 2) The Euro-Zone protection Firewall will not be further increased.
However, both certitudes seem abruptly not so sure - and that only hours before the Parliamentary decision on the second rescue package to Greece.
For the first time a member of the German Government advises Greece to leave the euro zone. It's been highlighted that this should not be misinterpreted as an eviction.
German Minister of Internal Affairs Hans-Peter Friedrich (Christian Social Union), in light of the threat of bankruptcy, has advised Greece to exit the Eurozone.
Outside the monetary union, [...]
IMF examines the option of contributing "only 13 billion €" to the new austerity help plan to Greece, reports the Wall Street Journal.
"IMF's level of participation has not yet been finalized" but the international financial institution is examining this option according to WSJ's sources.
IMF agreed in May 2010 to provide a loan of 30 million euros to Greece, contributing to a plan of 1100 billion euro.
Not only this was not enought for the greek economy to recover; now it's going through deep recession, which has actually increased public debt, notes the AFP.
According to WSJ, executives of the IMF express fears that IMF has been 'overly' exposed to the debt zone in the EU.
In the second document the MP goes into a comprehensive analysis, predicting that the Memorandum 2.0, will create a recession of approximately 7%, although it is presented to the Greek people as a solution for growth (instead of an actual recession trap). It should be noted that in the previous relevant analysis of Louka Katseli for the first Memorandum , she predicted a 5% recession for 2012. Her predictions were vindicated –not by the Ministry of Finance (Filippos Sachinides, the deputy minister of Finance actually accused of not knowing what she’s talking about) but– by Troika’s similar predictions for a recession of about 4-5%.
Katseli supports that Greece is able to pay salaries and pensions due to surplus. All that needs to be done is to negotiate a PSI that won’t have the terms for cutbacks included in the Memorandum. This, according to her opinion, is doable if Greece decide to enter a negotiation mindset. EU cannot expulse Greece from the euro, but it will have to suffer all the necessary consequences from Greece’s abidance. EU will therefore be forced to ultimately choose a different kind of PSI, one that won’t drive Greece straight to recesion
According to Deutsche Welle, the German manager warned Greeks to avoid by all means a return to the drachma. An exit scenario would be catastrophic for Greece making the country more poor than Albania:
"If Greece returns to drachma, VW cars would be replaced with donkey carts in Greek roads! Greece will become poorer than Albania. That's the truth and it should be said clearly to the Greek people."
On the other hand,Klaus Kalntemorgken is facing the future of Eurozone with optimism. He is pleased with Angela Merkel's management on the debt crisis which according to Kalntemorgken aims to restore fiscal discipline. Moreover, he believes that the political change in Italy is positive development and that Europe has the potential to overcome most of its problems even in the first quarter of 2012.
According to the New York Times scenario, the return to the drachma will trigger a series of unpleasant events such as the seizure of power by the military:
"As the country descends into chaos, the military seizes control of the government..."
"...lines of angry Greeks form at the shuttered doors of the country’s banks, trying to get at their frozen deposits. The drachma’s value plummets more than 60 percent against the euro, and prices soar at the few shops willing to open."
The EU Summit decisions are presented below as reported by capital.gr:
The new European Agreement will comprise of Eurozone’s 17 member states and six more nations however not all of 27 EU countries, according to the President of European Council Herman Van Rompuy.
Van Rompuy and Christine Lagarde stated that the countries will give supplemental funds of €200 billion to the IMF.
In addition, the President of European Council said that the EU member states will present their draft budgets to the European Commission. He also admitted that the intergovernmental agreement encounters obstacles, but a extensive agreement could not be achieved at this time.
Angela Merkel and Nicola Sarkozy believe that the poor countries might refuse to comply with their recommendations for tighter fiscal discipline which will be discussed in the Summit of 9 and 10 December. In addition, they are afraid of a "veto" from countries calling for a greater intervention by the European Central Bank, in order to help the economy.
For that reason the two leaders are planning to start the negotiations with the countries that are capable to follow their economic program in order to form a new smaller Eurozone only the economically powerful countries.
The finance ministers of the 17 Eurozone countries meet on EU headquarters today in a desperate effort to save the euro currency, and protect European, United States and other economies of the world from a financial disaster.
The dramatic situation in the European economies have placed new ideas on the table like a central authority for the countries' tax management, euro-bonds or even an elite group of euro countries that would guarantee one another’s loans and require strict economical discipline from all group members.
In the meanwhile, many economists and institutions around the world are discussing and take precautions for an upcoming fall of the euro:
It seems that the scenarios of forcing Greece out of the euro-zone are coming closer to reality....
Angela Merkel’s CDU party voted to permit euro members to quit the currency area, promoting the prospect of a action not allowed by the European rules.
The resolution, which requires the agreement of Merkel’s coalition partners in order to become a policy, is part of Germany's plans for closer political relationships and tighter budget rules in the EU.
The resolution reads:
In his interview for the Czech Newspaper ČeskéNoviny Czech President Vaclav Klaus stated:
"It's really a mistake to scale down the present fundamental European or euro zone crisis on the problem of Greece since Europe alone should be blamed its financial management and its choice to live beyond its means"
"I have been saying all the time it is not only true that Greece was taking exorbitant loans irresponsibly. The other side of the same story is that someone was providing exorbitant loans for Greece irresponsibly"