Spending Spree: Anger with Greek Shipowners on the Rise

by Manfred Ertel

Spiegel
June 19, 2014

The Greek economy continues to suffer, but the country's shipowners are spending as though there were no crisis. Once popular, Greece's shipping companies are now widely reviled.

There was a time when Greece's shipowners adorned the covers of gossip magazines and ran football clubs, secure in the affection of millions of fans. But these days, men like Theodoros Veniamis, one of the richest shippers in the country, need personal protection. Many don't leave home without it.

On the list of Greeks hated by their countrymen, shipowners have almost reached the top; only politicians are more reviled. They are threatened by radical leftist groups and even physically attacked. There have also been attempted kidnappings. In at least one case, a family of a shipowner paid millions in ransom.

Shipping magnates in Greece are considered greedy and unscrupulous. According to international analyses, at least €140 billion of shipping industry money has gone untaxed since 2002, a sum that would reduce the critically indebted country's financial obligations by almost half. In Switzerland alone, there is thought to be up to €60 billion in Greek funds, mostly belonging to shipping companies. They were partly accumulated legally, thanks to a web of special regulations allowing tax exemptions for ship owners, and partly illegally, through outright tax evasion. In the past year, Viktor Restis, a shipping company owner, was arrested under suspicion of money laundering.

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Fidelity Joins Prudential as Biggest Funds Go Greek

Bloomberg
June 18, 2014

The world’s largest investors are putting their trust in Greece’s government bond market as record-low yields across Europe compel them to invest in the country that sparked the region’s sovereign debt crisis.

Prudential Financial Inc. (PRU) owns Greek bonds maturing in five years or less and yen-denominated securities to capture the nation’s higher yields. Jupiter Asset Management Ltd. has been increasing its holdings since October and Fidelity Worldwide Investment said it has been steadily building a larger position over the past six months. Those investors, whose assets exceed $1.4 trillion, join the ranks of Invesco Ltd. (IVZ), BlackRock Inc. (BLK) and Legal & General (LGEN) Investment Management owning Greek debt.

“All the different euro-zone countries have different challenges and those facing Greece are among, if not the most, serious,” Robert Tipp, the Newark, New-Jersey based chief investment strategist at Prudential’s fixed-income unit, said in a telephone interview on June 12. “But there are a couple of things that Greece has in its favor in terms of the bond market. The relative value is attractive and the likely long-term course of these bonds is favorable.”

Greece returned to international markets after four years in April, selling 3 billion euros ($4.1 billion) of five-year securities and attracting bids in excess of 20 billion euros for the notes. Since then, yields on euro-area bonds have plummeted to record lows as the European Central Bank unveiled a package of stimulus measures to boost the region’s economy and combat the threat of deflation.

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Is Greece Really Back?

by Mohamed A. El-Erian

Bloomberg
June 17, 2014

It has been two years since Greece narrowly avoided an exit from the euro area that could have been disastrous for the country and extremely challenging for Europe and the global economy. Although the country has made a lot of progress since then, markets are far too sanguine about its rehabilitation.

On June 17, 2012 -- exactly two years today -- when Greeks went to the polls in parliamentary elections seen as a referendum on the government's austerity measures, investors were right to be worried about the country's economic future. An exit from the single currency, with all the financial chaos that could entail, was a clear and present danger.

Now, the seemingly-tentative coalition that emerged from those elections has steered Greece to relative safety. But the attendant sharp drop in the government's borrowing costs, and investors' hearty appetite for new issues of Greek sovereign and bank bonds, overstate the domestic improvements.

The rally in Greek assets has been turbocharged by a global quest for yield amid western central banks' extraordinary efforts to keep interest rates low. To hold on to foreign capital and reduce the chances of further instability, Greece must do more to improve its economic health.

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Interview by Greece’s newspaper Ethnos with IMF Mission Chief for Greece, Poul Thomsen

Ethnos
June 15, 2014

According to your report, Greece will need more money in the next few years. You also talk about the need for Greece to meet its needs. On the contrary, the Prime Minister calls for correction of the injustices against the people. Where will Greece find the money that you say it needs?

We currently estimate the financing needs through the end of the program in March 2016 to be about €30 billion, of which €18 billion can be covered through funds already committed by the IMF and Greece’s European partners. The remaining financing gap is about €12½ billion, which could be covered from a number of sources, including market financing. Thus, it is not clear yet whether Greece will need new money from its European partners.

Which scenario “scares” you the most in terms of political and economic developments in Greece?

The key challenge is to continue implementing structural reforms that are essential to achieving strong, sustained, and balanced growth over the medium term.

The Prime Minister and the new finance minister talk about the need to reduce taxation and ease austerity measures. There are rumors around that they have already decided “no more measures, enough is enough.” What's your response? And what is going to happen if the Troika asks for measures and Greece refuses to take them?

We have just completed a review, and I am confident that the government will meet the commitments that they have undertaken in this regard. After all, the government’s determination is demonstrated through its performance on the fiscal targets, which has been exceptional by any international comparison.

As for measures, we support the authorities’ desire to avoid across-the-board cuts in wages and pensions. But this is also why it is important to press ahead with structural reforms to modernize Greece’s fiscal institutions, such as strengthening tax administration, where progress continues to lag, so that everyone pays their fair share of taxes. Only with progress in these areas will it be possible to avoid further painful expenditure cuts.

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Where Is Greece’s IMF Apology?

by Simon Nixon

Wall Street Journal
June 13, 2014

Last week Christine Lagarde made an apology to the U.K. What a shame the International Monetary Fund boss didn’t extend a similar courtesy to Greece this week. No damage was done by the IMF’s crass warning last year that the U.K. government was “playing with fire” by pushing ahead with its deficit-reduction strategy since it turns out the U.K. had already embarked on what has turned out to be a remarkable recovery. But the IMF’s mis-steps in Greece last year had real consequences.

The IMF’s refusal to believe that Greece would achieve a budget surplus before interest costs in 2013 led to a seven-month delay in the disbursement of crucial bailout funds, which in turn delayed the country’s return to the bond markets that has since fueled a revival in confidence and funding. Indeed, had Athens capitulated to IMF demands for further fiscal measures to meet the imaginary deficit, Greece would almost certainly be facing a seventh consecutive year of recession. As things stand, Greece delivered a 0.8% primary surplus last year and new data this week shows it is well ahead of budget for a 1.5% surplus this year.

But even if the IMF couldn’t bring itself to say the S-word, its latest review of Greece’s bailout program published this week shows plenty of signs of contrition. It talks of “significant progress towards rebalancing the economy” and acknowledges that turning the weakest cyclically adjusted fiscal position in the euro area into the strongest in just four years is “an extraordinary achievement by any international comparison”. It says that “structural reforms are progressing, although unevenly,” growth risks could be “tilting to the upside in 2014” and expresses “cautious optimism” for the future.

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Greece Wars With Courts Over Ways to Slash Budget

by Niki Kitsantonis

New York Times
June 12, 2014

The Greek government has made a range of painful cuts to salaries, pensions and jobs for public workers over the last four years, saying they were needed to satisfy the demands of the international creditors that bailed the country out. But the Greeks hurt by those steps, and the nation’s courts, have a different idea.

Steadily, citizens groups — including police officers, university professors, cleaning workers and judges themselves — have challenged the cuts as illegal or unconstitutional. And in case after case, Greek courts have agreed, presenting a nearly existential question for the government: Can it actually shrink the state?

The mounting pile of judgments has now become a serious obstacle to the austerity drive of Prime Minister Antonis Samaras, with the International Monetary Fund warning this week that the “adverse court rulings” threaten to undo the country’s reforms, which its creditors are scheduled to begin reviewing in July.

Coming just as an embattled Mr. Samaras tries to convince citizens and investors that Greece is finally turning a corner, the rulings threaten to punch a gaping hole in the finances of the government. Besides potentially having to reverse many of its public-sector layoffs, Greece could be obliged to scramble for one billion euros, about $1.35 billion, in back pay.

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Greek Economy Expected to Return to Growth This Year

by Stelios Bouras

Wall Street Journal
June 12, 2014

Greece's central bank said it expects the country to exit a six-year recession this year, but warned that any complacency on reforms could thwart the economy's positive momentum.

In its annual monetary policy report released Thursday, the Bank of Greece forecast that the Greek economy will expand by about 0.5% this year, since the country's severe recession began bottoming out at the start of 2013.

The forecast jibes with estimates from the Greek government and its international creditors, who predict gross domestic product growing 0.6% this year.

"There remain, however, many uncertainties and risks which could delay or even reverse this path to recovery," said the report, the last to be signed by the central bank's outgoing governor, George Provopoulos. "In order to avert risks, the restructuring of the economy and the reforms must continue with even greater resolve across all areas," it added.

Mr. Provopoulos's six-year term as governor ends next week, when he will be succeeded by former Finance Minister Yannis Stournaras.

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Greece: Fifth Review Under the Extended Arrangement Under the Extended Fund Facility, and Request for Waiver of Nonobservance of Performance Criterion and Rephasing of Access

International Monetary Fund
Country Report No. 14/151
June 10, 2014

Extended Arrangement. On March 15, 2012, the Executive Board approved a four-year arrangement in the amount of SDR 23.79 billion (2,159 percent of quota; €28 billion). Purchases totaling SDR 7.2 billion (€8.1 billion) have been made so far, and a purchase in the equivalent of SDR 3 billion (€3.5 billion) is proposed to be released on the completion of the review. Euro area countries have so far disbursed €139.9 billion since this program’s approval (of €144.6 billion committed), of which €48.2 billion was for bank recapitalization. Developments. Significant progress has been made toward rebalancing the economy. The fiscal primary and external current account balances are in surplus. Investor sentiment has improved, and the government successfully placed a medium-term bond. The economy is poised to grow in 2014, after six years of deep recession. All this bodes well for a potentially virtuous cycle of recovery to take hold. But a number of challenges remain to be overcome before stabilization is deemed complete and Greece is on a sustained and balanced growth path. The real exchange rate remains overvalued, and non-tourism exports are relatively weak. Banks face a mountain of bad loans that will require adequate capital and oversight to clean up, absent which the prospects are of a prolonged deleveraging antithetical to the assumed recovery. Fiscal gaps are projected for 2015–16, and public debt remains very high. Policies. The authorities over-performed significantly on their 2013 fiscal primary balance target, achieving a surplus of 0.8 percent of GDP. Although the carryover of the over- performance to 2014 is small, the authorities are on track to achieve this year’s target. They are implementing a number of structural reform commitments, with a notable acceleration of product and service market liberalization, where progress has lagged. However, in the area of labor market reforms, where Greece has made important progress in the past, the program is now falling short of targets. Following the Bank of Greece’s stress tests, the HFSF buffer has been set aside to safeguard financial stability, and ambitious steps are planned to strengthen the private debt resolution framework. Reforms to tax codes have been legislated, aimed at simplifying the system and making tax administration easier and, thus, addressing longstanding weaknesses. But at the same time, the authorities need to guard against pressure to rollback progress. On public administration reform, progress is mixed as Greece is struggling to introduce performance-based management and address the taboo against mandatory dismissals.

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IMF Completes Fifth Review Under Extended Fund Facility Arrangement for Greece and Approves €3.41 Billion Disbursement

International Monetary Fund
Press Release No.14/254
May 30, 2014

The Executive Board of the International Monetary Fund (IMF) today completed the fifth review of Greece’s performance under an economic program supported by an Extended Fund Facility (EFF) arrangement. The completion of this review enables the disbursement of SDR 3.01 billion (about €3.41 billion, or US$4.64 billion), which would bring total disbursements under the arrangement to SDR 10.22 billion (about €11.58 billion, or US$15.75 billion).

In completing the review, the Executive Board approved a waiver of nonobservance of the performance criterion on domestic arrears, given the corrective actions taken. In light of the delays in program implementation, the Board also approved the authorities’ request for rephasing three disbursements evenly over the remaining reviews in 2014.

The EFF arrangement, which was approved on March 15, 2012 (see Press Release No. 12/85), is part of a joint package of financing with euro area member states amounting to about €173 billion over four years. It entails exceptional access to IMF resources equivalent to about 2,159 percent of Greece’s quota.

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Ενδεχόμενος δόλος

του Αριστείδη Χατζή

Τα Νέα
29 Μαΐου 2014

Μετά το εντυπωσιακό αλλά αναμενόμενο 9,4% της Χρυσής Αυγής ξεκίνησε και πάλι η συζήτηση για τον τρόπο με το οποίο θα αντιμετωπίσουμε το φαινόμενο. Η συζήτηση αυτή είναι ειλικρινής αλλά είναι και εκ του πονηρού. Όπως και να το κάνουμε, οι 537.000 ψήφοι βάζουν σε πειρασμό ακόμα και αριστερό Άγιο. Δεν σου πάει η καρδιά να εγκαταλείψεις έτσι εύκολα τις παραστρατημένες λαϊκές τάξεις – κι αυτές θύματα είναι! Άλλωστε, πάντα μπορούν να χρησιμεύσουν σε δεύτερους γύρους. Όσο για τη Δεξιά… Εκεί δεν χρειάζονται τα κροκοδείλια δάκρυα, ούτε έχουν τέτοιου είδους αναστολές. Είναι έτοιμοι να τους δεχτούν πίσω στο μαντρί και να σφάξουν και τον μόσχο τον σιτευτό.

Είναι ελάχιστοι αυτοί που έχουν το πολιτικό θάρρος να δουν την αλήθεια κατάματα και να αναγνωρίσουν το Τέρας. Είναι ελάχιστοι αυτοί που θα αποδώσουν ευθύνες κόβοντας τις οπορτουνιστικές γέφυρες και αναλαμβάνοντας, επιτέλους, τον παιδαγωγικό ρόλο που πρέπει να παίζει η πολιτική σε μια ευρωπαϊκή φιλελεύθερη δημοκρατία. Αυτός ο ρόλος περιλαμβάνει την υποχρέωση να ειπωθούν κάποια πράγματα με το όνομά τους.

Οι ψηφοφόροι της Χρυσής Αυγής μοιράζονται την ηθική ευθύνη για τις πράξεις των πλέον σκληρών μελών της οργάνωσης. Δεν ξέρω ποια θα είναι η δικαστική πορεία της υπόθεσης. Ξέρω όμως ότι υπάρχουν νεκροί και πολλοί τραυματίες (σωματικά και ψυχικά). Δεν ξέρω αν η Χρυσή Αυγή είναι εγκληματική οργάνωση. Είναι όμως μια ναζιστική οργάνωση, με φασιστικές μεθόδους δράσης και καθαρόαιμα εθνικοσοσιαλιστική ιδεολογία.

Εσείς λοιπόν που την ψηφίσατε είστε ηθικά υπεύθυνοι για όσα έκανε, όσα κάνει και όσα θα κάνει αυτή η ναζιστική οργάνωση. Αν μου απαντήσετε ότι δεν είστε ναζιστές και δεν εγκρίνετε όλες τις πράξεις ή το σύνολο των «ιδεών» της οργάνωσης, αυτό δεν θα μειώσει την ευθύνη σας. Γνωρίζετε πολύ καλά πλέον τι είναι η Χρυσή Αυγή και τι είναι ικανή να κάνει. Δεν έχετε καμία αμφιβολία για την ιδεολογία της και τους στόχους της. Οι «καλές σας προθέσεις» θυμίζουν τον ενδεχόμενο δόλο στο ποινικό δίκαιο: o δράστης δεν επιδιώκει το αποτέλεσμα της πράξης του αλλά το αποδέχεται, δεν τον ενοχλεί ιδιαίτερα.

Οι ψηφοφόροι της Χρυσής Αυγής δεν όπλισαν το χέρι που σκότωσε έναν Πακιστανό και έναν Έλληνα. Είναι όμως έτοιμοι να δείξουν κατανόηση για τον δράστη «που τον προκάλεσαν». Δεν λύντσαραν οι ίδιοι μετανάστες, αλλά νιώθουν ανακούφιση που υπάρχουν άλλοι να κάνουν τη βρώμικη δουλειά γι’ αυτούς. Όταν τους φέρεις προ των ευθυνών τους, η απάντηση είναι ανάλογης ποιότητας με τις πολιτικές επιλογές τους: ρευστοποιούν την έννοια της ευθύνης, σχετικοποιούν τη βία, ισοπεδώνουν τα πάντα.

Μην σας κάνει εντύπωση ο αριθμός τους. Νομίζω ότι το 9,4% συνιστά μάλλον αποτυχία για τη Χρυσή Αυγή, καθώς το κοινό στο οποίο απευθύνεται είναι πολύ ευρύτερο: από τους ψεκασμένους (το 1/3 του πληθυσμού!) που ζουν στη ζώνη του λυκόφωτος έως εκείνους που ακόμα και σήμερα δεν έχουν αντιληφθεί τι συνέβη στην Ελλάδα τα τελευταία τέσσερα χρόνια, ούτε κατανοήσει τις παθογένειες των τελευταίων σαράντα ετών. Δυστυχώς, όμως, θα πρέπει να προσθέσουμε στον ανορθολογισμό και στην πολιτική άγνοια και άλλα, πιο σκοτεινά χαρακτηριστικά του μέσου Έλληνα, όπως τον ρατσισμό και τον αντισημιτισμό.

Τα αποτελέσματα της μεγάλης παγκόσμιας έρευνας για τον αντισημιτισμό που διεξήγαγε η ADL και ανακοινώθηκαν στα μέσα του μήνα ήταν ταυτόχρονα αποκαλυπτικά και εξευτελιστικά για τη χώρα μας. Σύμφωνα με την έρευνα, το 69% των Ελλήνων υιοθετούν αντισημιτικά στερεότυπα. Το 69% (δύο στους τρεις!) είναι υπερβολικά και θλιβερά πολύ αν το συγκρίνουμε με το 19% της Αμερικανικής Ηπείρου, το 24% της Δυτικής και το 34% της Ανατολικής Ευρώπης. Με το 22% της Ασίας, το 14% της Ωκεανίας και το 23% της Υποσαχάριας Αφρικής. Αλλά βέβαια είναι απόλυτα συγκρίσιμο με το 74% της Μέσης Ανατολής και της Βόρειας Αφρικής!

Υπάρχουν βέβαια αντισημίτες σε όλον τον κόσμο. Παντού όμως είναι η μειοψηφία, μια θλιβερή μειοψηφία μικρή ή μεγάλη. Στην Ελλάδα, αντιθέτως, οι ρατσιστές αντισημίτες είναι η μεγάλη πλειονότητα. Είναι η δεξαμενή της Χρυσής Αυγής.

Και τώρα τι κάνουμε; Πώς αντιμετωπίζουμε αυτό το φαινόμενο; Υπάρχουν απαντήσεις, και θα επιχειρήσω να τις δώσω λίαν προσεχώς.

* Ο Αριστείδης Χατζής είναι αναπληρωτής καθηγητής Φιλοσοφίας Δικαίου και Θεωρίας Θεσμών στο Πανεπιστήμιο Αθηνών.

Εδώ θα βρείτε το άρθρο (όπως δημοσιεύθηκε στα Νέα)

Εδώ θα βρείτε το άρθρο στην ιστοσελίδα των Νέων.

Εδώ θα βρείτε το δεύτερο άρθρο μου στα Νέα για το ίδιο θέμα. (δημοσιεύθηκε ως συνέχεια του παρόντος κειμένου)

Εδώ θα βρείτε ένα παλαιότερο άρθρο μου με τίτλο "Γράμμα προς ένα νέο οπαδό της Χρυσής Αυγής"

Εδώ θα βρείτε ένα ακόμα άρθρο μου για το Ναζισμό ("Οι Ζωές των Ανθρώπων")

Εδώ θα βρείτε το Index of Antisemitism του ADL (για την Ελλάδα εδώ)

του Δημήτρη Χαντζόπουλου (Τα Νέα, 21/5/2014)

Pandora’s Ballot Box

by Alexander Skouras

AtlasOne
May 28, 2014

In ancient Greek mythology, Pandora’s Box was a container filled with evil. On May 25 Europeans went to the polls where they opened Pandora’s ballot box, which contained an evil long thought to be forgotten: a national socialist (Nazi) party.

The vote count revealed that three representatives of Greece’s Golden Dawn had been elected to the European Parliament. Many Europeans won’t draw the connection immediately, but soon these members of the most brutal, hateful, and bigoted political group the Parliament has seen in 35 years will be receiving tax-funded salaries.

Since its previous electoral success, of course, Golden Dawn has tried to hide its pro-Nazi past. But evidence of its worldview is abundant and irrefutable.

Golden Dawn’s rise from a tiny group of radical Hitler-sympathizers to the third largest party in Greece occurred when the Greek economy was collapsing. The origins of this crisis are well-known and well-documented: excessive borrowing, low productivity, corruption, and a profligate welfare state. At the height of the crisis the entire nation was angry; the people felt betrayed by their political elites. The Nazi party arose from the need to blame outsiders and to feel special.

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Golden Dawn: The fox in Europe’s hen house

by Takis S. Pappas

Policy Network
May 27, 2014

Golden Dawn is a racist neo-fascist party, openly hostile to representative institutions and political pluralism. After coming third in this weekend’s elections, the question arises of how to confront it?

Never mind that he bears a swastika tattoo on his arm, denies the existence of the Holocaust, and considers Hitler “a great social reformer” and “military genius”. At voting for the first round of Greece’s municipal and country-district elections on May 18th, Ilias Kasidiaris, spokesman of the neo-fascist Golden Dawn party and its candidate for the Athens mayoralty, was the choice of 16.1 percent of the voters. On the same day, Ilias Panagiotaros, another party strongman who was candidate for the governorship of the Attica region, gained 11.1 percent of the vote. Nationwide, Golden Dawn was estimated to enjoy the support of about 8 percent of the voters. It was an underestimation. At the elections for the European Parliament on May 25th, Golden Dawn won a stunning 9.4 percent of the total vote, or a rise of about 30 percent over its results in the June 2012 national elections. It finished as the third party in Greece and entered for the first time the European Parliament with three deputies. The party leader, Nikos Michaloliakos, declared from his prison cell, while still awaiting trial for running it as a criminal organisation: “We are already the arbiters of political developments; we are the forthcoming Greece.”

Who voted for this party, and why? Contrary to what you may have expected, the typical Golden Dawn voter is not an illiterate unemployed skinhead. As recent research shows, he (men are over-represented in the party) has the characteristics of the median Greek voter in terms of social status (middle class), education (university), and residence (urban). Still, having lost about 40 percent of his purchasing power since the start of the crisis and living in the country with the highest unemployment rate in Europe, he is uneasy with capitalism and market competition, mistrustful of mutually reinforcing institutions, and uncomfortable with the idea of political consensus. And, like most other Greeks these days, he is angry. But not because the crisis has robbed them of a future; it is because they lost, almost instantaneously, what the old parties had given them foolishly, and in most cases unreservedly, in the past.

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From Greek Crisis, to Turnaround

by George A. Provopoulos

Wall Street Journal
May 19, 2014

Several years ago a chorus of voices predicted that Greece would have to exit the euro zone. The doomsayers had it that Greece would not be able to make the fiscal and economic reforms needed to keep the country in the euro, nor would it be able to save its banking system in the face of an unprecedented sovereign-debt crisis. According to the doomsayers, attempts to bring down the budget deficit and restore competitiveness would lead to painful and politically unacceptable consequences, while a collapse of the banking system was inevitable. Recently, however, the sirens of doom have been silenced. How did that happen?

Since the onset of the crisis almost five years ago, the turn-around of the Greek economy has been remarkable. Last year the government booked a primary fiscal surplus of nearly 1% of GDP, after the primary balance swung from a deficit of 10.5% of GDP in 2009.

Since then, competitiveness—as measured by labor costs relative to those of Greece's trading partners—has improved by more than 30%. Competitiveness is also being promoted through structural reforms, which have increased the flexibility of labor and product markets.

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European Elections to Test Greek Coalition

by Simon Nixon

Wall Street Journal
May 18, 2014

There seems to be a broad consensus—among voters and in the markets—that this week's European parliamentary elections don't matter very much.

Although the Parliament has gained new powers over the years, few voters identify with it. Polls suggest many will see the election as an opportunity to cast protest votes for populist parties. Most voters suspect the outcome will make little difference to the future direction of Europe, which will in any case continue to be set by national leaders and parliaments.

But there is one country where the European elections really do matter.

In Greece, the elections will determine the future of the uneasy coalition government led by Prime Minister Antonis Samaras since June 2012. If the two coalition parties—New Democracy and Pasok—get a lower combined vote than the radical left-wing opposition party Syriza, the government would be in real trouble, acknowledges a senior minister. The outcome could be early national elections and a prolonged period of political instability.

As things stand, that seems unlikely: The latest polls suggest New Democracy will get 21% of the vote and Pasok 5.5%, compared with 21.5% for Syriza.

But even this may not be enough to guarantee the coalition's survival.

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‘If the euro falls, Europe falls’

by Peter Spiegel

Financial Times
May 15, 2014

As soon as Angela Merkel was handed the piece of paper Barack Obama had just passed around the table, her guard went up. “What is this?” the German chancellor asked. “I haven’t seen this before.”

The US president characterised the paper as talking points he and his seven European counterparts in the room could rally around when the Group of 20 summit ended that afternoon in Los Cabos, Mexico.

Most of the items were concise recitations of what had been formally agreed. But the last point was something new, say officials who read the sheet: a full-scale endorsement of a plan that had only been informally shopped around the summit by the man sitting next to Ms Merkel – Mario Monti, the Italian prime minister.

The scheme, which Mr Monti and his closest advisers had been working on for months before the June 2012 summit, called for the European Central Bank to protect eurozone countries when they came under attack from financial markets by automatically buying their bonds.

Only “virtuous” countries that obeyed the EU’s budget rules would be eligible. But the Monti plan would ensure borrowing costs, which for Italy and Spain were again rising to dangerous levels, would be capped.

“We wanted to develop something that would not be dangerous for the control of the money supply in Europe, would not be offensive to German purism, would help concretely moderate the [bond] spreads, but could be earned only as a reward for virtue,” Mr Monti told the Financial Times.

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Inside Europe’s Plan Z

by Pieter Spiegel

Financial Times
May 14, 2014

Every working day since the crisis struck, George Provo­poulos, the silver-haired governor of Greece’s central bank, summoned a small “emergency team” of aides to his offices at 6pm to review the health of the nation’s banks. What he was told on June 15 2012 was enough to make the courtly central banker blanch.

It was the Friday before a parliamentary election – the second national vote in as many months – and the country appeared to be edging towards panic. On that day, Greeks withdrew more than €3bn from their bank accounts, or about 1.5 per cent of the country’s entire economic output. The Bank of Greece had watched people moving money from their banks to their mattresses for nearly three years, but never on such a scale.

“In a matter of a few days, a full-blown banking crisis could have erupted,” Mr Provopoulos said in an interview. At that rate, Greece would run out of bank notes in a day or two.

Unbeknown to almost the entire Greek political establishment, however, a small group of EU and International Monetary Fund officials had been working clandestinely for months preparing for a collapse of Greece’s banks. Their secret blueprint, known as “Plan Z”, was a detailed script of how to reconstruct Greece’s economic and financial infrastructure if it were to leave the euro.

The plan was drawn up by about two dozen officials in small teams at the European Commission in Brussels, the European Central Bank in Frankfurt and the IMF in Washington. Officials who worked on the previously undisclosed plan insisted it was not a road map to force Greece out of the euro – quite the opposite. “Grexit”, they feared, would wreak havoc in European financial markets, causing bank runs in other teetering eurozone economies and raising questions of which country would be forced out next.

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How the euro was saved

by Pieter Spiegel

Financial Times
May 11, 2014

To the astonishment of almost everyone in the room, Angela Merkel began to cry.

“Das ist nicht fair.” That is not fair, the German chancellor said angrily, tears welling in her eyes. “Ich bringe mich nicht selbst um.” I am not going to commit suicide.

For those who witnessed the breakdown in a small conference room in the French seaside resort of Cannes, it was shocking enough to watch Europe’s most powerful and emotionally controlled leader brought to tears.

But the scene was even more remarkable, those present said, for the two objects of her ire: the man sitting next to her, French President Nicolas Sarkozy, and the other across the table, US President Barack Obama.

It would be the low point in a brutal, recrimination-filled night, one many participants would recall as the nadir of the three-year eurozone crisis. Mr Sarkozy had hoped his leadership of the Group of 20 summit would cement his standing on the global stage en route to re-election. Instead, everything was falling apart.

Greece was imploding politically; Italy, a country too big to bail out, appeared just days away from being cut off from global financial markets; and Ms Merkel, try as Mr Sarkozy and Mr Obama might, could not be convinced to increase German contributions to the eurozone’s “firewall” – the “big bazooka” or “wall of money” they believed had to grow dramatically to fend off attacks by panicking bond traders.

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Athens Lacking Only Elgin as Windows Erase Crisis

Bloomberg
April 24, 2014

The marble paving stones have been relaid in Athens’s Syntagma Square, the site of pitched battles between police and protesters during the worst of Greece’s economic crisis.

Yannis Stournaras has replaced his sixth-floor window overlooking the square. It was pierced by an errant bullet during one of the riots in 2010.

“I changed the window because I decided this era has ended,” Stournaras, the 57-year-old finance minister, said in an interview.

The cosmetic changes around the city’s central plaza signal Greece’s emergence from the crisis that made Athens the fuse to Europe’s debt bomb. Earlier this month, the country completed its first bond sale in four years, bookending a period when it was bailed out twice and completed the biggest-ever sovereign restructuring. As the country teetered on the brink of a political and economic abyss, Syntagma, bounded by the national Parliament, luxury hotels, office buildings and a McDonalds, served as the backdrop for televised reports beamed globally on the chaos.

Now, Athens Mayor George Kaminis, a 59-year-old native of New York City, is sketching out a return to normalcy in a city dubbed the most unlivable in western Europe since 2010 by Mercer, the consulting division of New York-based Marsh & McLennan Cos.

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EU Confirms Greece Beat Its Budget Targets in 2013

Wall Street Journal
April 23, 2014

Greece beat its budget targets last year, Europe's statistics agency said Wednesday, confirming a dramatic turnaround in the country's public finances and opening the way for fresh debt reduction measures by Greece's euro-zone partners in the months ahead.

According to the data, Greece achieved a primary budget surplus—before counting debt payments—of €1.5 billion in 2013 ($2.08 billion); one year ahead of expectations and higher than the goal set by the country's international creditors who stipulated that Athens aim for a balanced primary budget last year.

The data is a "reflection of the remarkable progress Greece has made in repairing its public finances since 2010," Simon O'Connor, a spokesman for the European Commission said at a news conference in Brussels.

Last year's primary surplus represents the first by Greece in a decade, and the confirmation from Eurostat Wednesday comes almost exactly four years after Greece sought the first of two successive international bailouts to fix its budget problems and overhaul its economy.

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Greek politics: Remaking the political landscape

Economist
April 19, 2014

Greece’s chances of recovery after six years of misery are improving. Its first bond offering in four years, seen as a test of confidence, did much better than expected. Tourists are flocking in for Easter; hoteliers predict a record 19m visitors will come this year. One long-blocked resort project on Crete seems poised to go ahead, raising hopes that foreign investment may flow into other industries such as electricity and ports. Angela Merkel, the German chancellor and often one of Greece’s harshest critics, spoke encouragingly to young Greek entrepreneurs during a quick visit to Athens on April 11th.

Yet the new optimism does not seem to be trickling down to most voters. Unemployment fell slightly in January, but still stood at 26.7%. The social safety-net is stretched so thin that only one in ten of the unemployed gets any benefits. Private-sector workers complain of being paid months in arrears. An estimated 35% of Greeks now live in poverty, according to social workers and charities.

No wonder Greece’s clientelist political system is in tatters. It was once a politician’s responsibility to find jobs in the public sector for his (rarely her) constituents. Ambitious MPs extended their patronage to the private sector. “My application for an assistant supermarket manager’s job was picked on merit, but it wasn’t approved by the local MP—he wanted someone else,” says Simos, a 28-year-old economics graduate now working in Germany.

Angry voters used to shout “Thieves, traitors” outside parliament as lawmakers waved through a string of unpopular reforms demanded by Greece’s creditors. The centre-right New Democracy (ND) and the PanHellenic Socialist Movement (Pasok), partners in a fractious coalition with only a two-seat majority in parliament, are now widely blamed for the collapse of the patronage system that they built during 30 years of alternating in power.

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Θεωρίες και Άκρα

του Αριστείδη Χατζή

Τα Νέα
17 Απριλίου 2014

Κατά τη διάρκεια της κρίσης χύθηκε πολύ μελάνι για ανοησίες. Από τους ψεκασμούς και τις διάφορες θεωρίες συνωμοσίας μέχρι την ακατάσχετη πολυλογία και εσχατολογία που δημιουργούσε περισσότερο θόρυβο παρά διάλογο.

Μία από τις ανόητες θεωρίες, που ευτυχώς μας άφησε χρόνους αυτές τις ημέρες, είναι και η θεωρία των δύο άκρων. Η θεωρία αυτή ήταν βλακώδης, όχι βέβαια γιατί δεν υπάρχουν τα δύο άκρα. Όσο θα υπάρχει ένα ισχυρό ναζιστικό κόμμα στην Ελλάδα και όσο θα δραστηριοποιούνται αριστερές τρομοκρατικές οργανώσεις μικρού και μεγάλου βεληνεκούς μπορεί κανείς κάλλιστα να μιλά για δύο άκρα. Είναι τα άκρα της βίας.

Όμως η «θεωρία των δύο άκρων» είναι κάτι άλλο. Σύμφωνα μ’ αυτήν το ένα άκρο βέβαια είναι η Χρυσή Αυγή. Το άλλο όμως είναι ο ΣΥΡΙΖΑ. Σε κάποιες εκδοχές ακόμα και το ΚΚΕ. Δεν χρειάζεται βέβαια να εξηγήσω γιατί είναι θηριώδης ανοησία να συγκρίνεται το ΚΚΕ με τη Χρυσή Αυγή χρησιμοποιώντας το επιχείρημα του σταλινισμού. Όσοι κάνουν αυτό το λάθος έχουν μείνει ακόμα στο 1949 ή πάντως δεν φαίνεται να έχουν ξεπεράσει το 1974. Ανεξάρτητα των επίσημων πολιτικών θέσεων του ΚΚΕ, δεν μπορεί κανείς να μη διακρίνει τη σιωπηρή μεν αλλά ηχηρή από πολλές απόψεις αποδοχή της κοινοβουλευτικής δημοκρατίας. Η απόσταση της ρητορικής από τη συμπεριφορά του κόμματος είναι τόση που μόνο ένας κακόπιστος (και ταυτόχρονα ανόητος) θα το τοποθετούσε μαζί με τη Χρυσή Αυγή. Ο τρόπος που το ΚΚΕ διαχειρίστηκε πολιτικά την κρίση είναι ενδεικτικός. Η σωφροσύνη του μάλιστα του στοίχισε (και συνεχίζει να του στοιχίζει) πολύ ακριβά.

Αλλά πάμε στον ΣΥΡΙΖΑ, γιατί αυτός είναι ο πραγματικός στόχος αυτής της θεωρίας. Η σκοπιμότητα ήταν βέβαια να πληγεί καθώς επιχειρεί να μετατραπεί σε κόμμα εξουσίας. Ο ίδιος ο ΣΥΡΙΖΑ έκανε ό,τι μπορούσε για να δικαιώσει αυτήν τη θεωρία. Από τη μια δεν φαίνεται να είναι καθόλου επιλεκτικός στα στελέχη του. Ανάμεσά τους υπάρχει μεγάλος αριθμός ανθρώπων που δεν θέλουν να έχουν καμία σχέση με τη φιλελεύθερη κοινοβουλευτική δημοκρατία ευρωπαϊκού τύπου. Είναι περιθωριακοί, είναι ακίνδυνοι αλλά είναι φωνακλάδες. Ο θόρυβος που προκαλούν κάνει πολύ κακό στον ΣΥΡΙΖΑ και αυτό το καταλαβαίνουν πλέον ακόμα και όσοι υποτιμούσαν το πρόβλημα. Από την άλλη, η συμπεριφορά πολλών στελεχών του απέναντι στο πραγματικό άκρο, τους τρομοκράτες, είναι απαράδεκτα αμφίσημη. Όχι βέβαια γιατί ο ΣΥΡΙΖΑ έχει οποιαδήποτε σχέση με την τρομοκρατία αλλά γιατί πολλοί οπαδοί του κόμματος την αντιμετωπίζουν με αισθήματα συμπάθειας - και ο ΣΥΡΙΖΑ δεν θέλει να τους αποξενώσει.

Ό,τι και να πει κανείς για τα πολιτικά αλλά και τα στρατηγικά λάθη του ΣΥΡΙΖΑ (κι εγώ έχω να πω πάρα πολλά!) δεν μπορεί να μην αναφωνήσει «αιδώς Αργείοι» σ’ αυτούς που πρωταγωνίστησαν στη στοχοποίησή του με όπλο τη θεωρία των δύο άκρων. Διότι αντί να στοχεύσουν στην απαράδεκτη και καταστροφική οικονομική πολιτική που προτείνει, προσπάθησαν να τον παρουσιάσουν ως λεοντή για το αριστερό άκρο. Το αστείο είναι ότι τελικά αποδεικνύεται ότι οι ίδιοι ήταν πολύ περισσότερο «άκρο» από το υποτιθέμενο «άλλο άκρο».

Όλες οι πρόσφατες αποκαλύψεις για τις υπόγειες διαδρομές ΝΔ και Χρυσής Αυγής τι άλλο φανερώνει; Εδώ δεν μιλάμε για 2-3 απίθανους τύπους που εξελέγησαν τυχαία και λένε μπαρούφες στη Βουλή αλλά για τον γενικό γραμματέα της Κυβέρνησης. Ακόμα και το σήριαλ με το ευρωψηφοδέλτιο της ΝΔ είναι αποκαλυπτικό. Για να μην αναφέρουμε την ανατριχιαστική θεσμικά πρόταση δημοψηφίσματος για το τζαμί.

Πώς τα κατάφεραν έτσι τα κόμματα του Κωνσταντίνου Καραμανλή και του Λεωνίδα Κύρκου, τα δύο κατεξοχήν ευρωπαϊκά κόμματα της Μεταπολίτευσης; Δεν είναι όμως ώρα για δακρύβρεχτες αναδρομές. Έχουν και τα δύο τώρα μια ιστορική ευκαιρία (και οι ηγεσίες τους φαίνεται να το αντιλαμβάνονται). Η ΝΔ είναι ιδιαίτερα τυχερή γιατί οι φασίστες, οι ψεκασμένοι και η λαϊκή ακραία συντηρητική δεξιά αναζητούν αλλού την τύχη τους. Ας τους κουνήσει το μαντήλι οριστικά κι ας μετεξελιχθεί επιτέλους σε σοβαρό ευρωπαϊκό φιλελεύθερο συντηρητικό κόμμα. Ο ΣΥΡΙΖΑ αρχίζει να αντιλαμβάνεται ότι ο δρόμος για την εξουσία περνάει από την Κεντροαριστερά. Ας μετεξελιχθεί επιτέλους σε ένα πραγματικά προοδευτικό σοσιαλιστικό κόμμα της Ευρωπαϊκής Αριστεράς.

Ας πετάξουν από πάνω τους τα άκρα και όλες τις θεωρίες που τα συνοδεύουν.

* Ο Αριστείδης Χατζής είναι αναπληρωτής καθηγητής Φιλοσοφίας Δικαίου και Θεωρίας Θεσμών στο Πανεπιστήμιο Αθηνών.

Εδώ θα βρείτε το άρθρο (όπως δημοσιεύθηκε στα Νέα)

Εδώ θα βρείτε το άρθρο στην ιστοσελίδα των Νέων

Greece to stabilise this year, but recovery road will be long

Reuters
April 16, 2014

The outlook for Greece's economy has improved but analysts say the revival in investor sentiment that led Athens to tap the bond markets again this month still needs to be backed up by better data, a Reuters poll found.

After six straight years of recession that has reduced the economy by about a quarter of its size and driven unemployment to a record of nearly 28 percent, Greece's economy is expected to begin a long road to recovery this year.

Thursday's poll of nearly 35 economists and strategists taken in the past week pointed to an expansion of just 0.3 percent this year, lower than the EU/IMF projection of 0.6 percent the Greek central bank's forecast of 0.5 percent growth.

Those growth projections are not far behind consensus expectations for the euro zone economy as a whole.

"There are increasing signs the Greek economy is stabilizing and we expect to see a positive reading in terms of GDP growth at some quarter down the road this year," said economist Angelos Tsakanikas at IOBE, a research firm.

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The Tide Is Turning for Greece—and the Euro Zone

by Simon Nixon

Wall Street Journal
April 13, 2014

Greece's return to the bond markets last week was a symbolically important moment for the euro crisis. For the country at the center of the crisis to draw €20 billion ($27.77 billion) of foreign demand for a five-year bond yielding under 5% shows that the market now believes Greece will stay in the euro zone, that it won't collapse into chaos and that any further debt relief will be provided by official rather than private lenders. A year ago, there were few takers for that bet.

But this was only the latest in a series of remarkable developments this year that show how far market sentiment toward Southern Europe has changed.

This shift began in January when the nationalized Spanish lender Bankia was able to issue an unsecured bond. Since then, Madrid has sold shares in Bankia to international investors. Other Spanish banks, along with Italian, Austrian and even Greek banks, have raised capital.

Buying bank equity is a bigger bet on economic recovery than buying sovereign bonds since there is no implicit guarantee from the European Central Bank.

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This could be the moment for Greece to default

by Wolfgang Münchau

Financial Times
April 13, 2014

While the financial world is celebrating the Greek return to the bond markets, I am asking myself this question: is this a good time for Greece to default on its foreign debt? It is not a subject of polite conversion in Brussels or Athens. Nor does it appear to be a popular subject for investors’ conferences.

For the first time since the crisis Greece is in a position to default. It has a primary budget surplus – before interest payments. The European Commission has forecast the primary surplus to reach 2.7 per cent of gross domestic product this year, rising to 4.1 per cent in 2015. The Greek current account registered a first surplus. Greece is no longer dependent on foreign investors.

Of course, just because you are in a position to default does not mean that you should. So how should one think about this?

Greece is probably now close to the bottom of its economic slump, which started six years ago. Between 2008 and 2013 real GDP shrank by 23.5 per cent and investment by 58.4 per cent. The most recent labour force survey showed unemployment at 26.7 per cent in January. The rate of youth unemployment in 2013 stood at 60.4 per cent. Bank loans to businesses were down at an annual rate of 5.2 per cent in February. Non-performing loans have reached a level of 38 per cent of the total. Bank deposits are shrinking.

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For Bond Investors, Greece Is The Word

by Alen Mattich

Wall Street Journal
April 10, 2014

Not only have investors forgiven Greece for its sovereign debt default only two years ago, but they seem to have forgotten that many of the same economy’s problems persist.

Indeed, the scale of investors’ collective charitableness and amnesia towards what was until recently a market pariah is only made starker by the fact that Sweden couldn’t offload the whole of Wednesday’s bond issue.

Greece raised 3 billion euro in five-year bonds at a 4.95% yield, amid 20 billion euro of orders from 550 accounts. Sweden’s 3.5 billion krona 2025 government bond issued this week only received 3.31 billion krona in bids at an average yield of 2.25%.

Around the time of the default, Greek 10-year yields were hitting 30%. What a difference a couple of years makes.

The difference isn’t just Greece’s economic fundamentals, though they have changed somewhat for the better. The depression is expected to bottom this year, with the economy returning to modest growth of 0.6% after contracting 3.7% in 2013 and 6.4% in 2012.

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Greece’s return to the markets: The prodigal son

Economist
April 14, 2014

The journey has been an epic one, but Greece has reached, if not the destination, at least a waymark. The last time that its government raised long-term funds was in March 2010, just weeks before the markets lost confidence in Greece altogether, forcing its first bail-out. This week the Greek government returned to the markets, raising €3 billion ($4.1 billion) in five-year bonds at a yield of just under 5% in a heavily oversubscribed issue.

The amount might be small and the yield high compared with borrowing costs in other rescued countries, such as Portugal, whose five-year notes were trading at around 2.6%. But the notion of any bond issue at all still prompts eye-rubbing, given the depth of the Greek crisis. Six consecutive years of recession have seen the economy shrink by a quarter, prompting social and political turmoil that at its worst seemed quite likely to push Greece out of the euro zone. For most of the past four years a return to the markets on any terms seemed inconceivable, a view underscored by vaulting bond yields (see chart).

Over this period Greece has been wholly reliant on help from euro-zone governments and the IMF to meet its financing needs. In May 2010 it received its first three-year bail-out, of €110 billion. The aim then was that it should start tapping the markets again as early as 2012. Instead within less than two years Greece required a second and even bigger bail-out, raising the total amount of funding from euro-zone lenders and the IMF to €246 billion by 2016, equivalent to 135% of last year’s GDP.

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Is Greece really out of the woods?

by Desmond Lachman

AEIdeas
April 11, 2014

Judging by this week’s successful Greek international bond placement, one could be forgiven for thinking that the Greek economy is finally out of the woods. For not only was the Greek government successful in placing EUR 3 billion in bonds at the lowest interest that Greece has enjoyed since the onset of the crisis in 2010, but it has found that its bond issue was six-times oversubscribed.

Before placing too much weight on the market’s apparently rosy assessment of Greece’s economic prospects, it is well to recall the market’s very poor track record in anticipating the Greek sovereign debt crisis. As late as mid-2009, the Greek government only had to pay as little as 18 basis points more than the German government did on its long-term bond issues. And it did so despite extraordinarily large domestic and external economic imbalances in the Greek economy that would soon lead to the largest sovereign debt default in history.

There are all too many reasons to think that despite the market’s present optimism Greece will relapse into crisis before the year is out. Among the more troubling of these reasons is that the Greek government has simply lost the political willingness to persevere with austerity and structural reform that might support an economic recovery. This has been all too apparent in the government’s protracted negotiations with the troika over the last review of the IMF-EU program. And it will become even more apparent should Greece exit the IMF-EU program and no longer be under the troika’s tutelage.

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Trouble Brews for Greece Despite Good News on Bond Sale

by Matina Stevis and Marcus Walker

Wall Street Journal
April 10, 2014

Greece's successful return to the markets Thursday was a triumph of politics—and it is in politics where the risk to the country's recovery lies.

A good-news operation has been under way since the start of the year. Once the target of vocal criticism by euro-zone politicians and officials involved in the bailout process, Greece has been getting praise from all quarters.

European Union officials say that at the heart of this turnaround in mood is the alliance forged between Greek Prime Minister Antonis Samaras and German Chancellor Angela Merkel.

Ms. Merkel arrives in Athens on Friday—her second visit since Mr. Samaras took office in summer 2012. Greece's return to longer-term market borrowing just 24 hours before serves as the perfect red carpet for the German leader.

But behind the good news, not all is well with Greece's economic resurrection.

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Greece Triumphs in Bond Odyssey

by Richard Barley

Wall Street Journal
April 10, 2014

So Greece is back. Investors placed €20 billion ($27.7 billion) of orders for its €3 billion five-year bond, and as a result the final yield came in at just 4.95%. For a country that restructured its debt only two years ago, that is a remarkable result.

The final yield is not only way beneath the initial suggestions that Greece's bond could yield 5.25% to 5.5%, implying that investors have given up a lot of potential gains already; It also is less than Ireland paid when it issued its first postcrisis five-year bond. True, Ireland did so in July 2012, when Spain was teetering on the brink of junk status and investors still had doubts about the survival of the euro. But Ireland, which is far more creditworthy than Greece, paid a yield of 5.9% then.

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Greece Gets Strong Demand for Bond

Wall Street Journal

April 10, 2014

Greece Thursday wrapped up its first longer-term bond sale in four years to strong demand, a nod to the glut of spare cash flooding financial markets as well as the steps taken by Greece to repair its battered economy.

Greece will raise €3 billion ($4.14 billion) by selling bonds that mature in 2019. The sale attracted more than €20 billion of demand, according to bankers working on the deal.

The bankers said the five-year bond would price to yield 4.95%—a sharply lower price tag than initial suggestions in the range of 5.25% to 5.5%. About 550 investor accounts placed orders, they added. The finance ministry said close to 90% of the demand came from abroad.

"[Greece is being] viewed differently. The Greek bond issuance is a turning point in the sovereign bond crisis," said Achilles Risvas, managing partner at Dromeus Capital Management in Switzerland, who said he is participating in the new Greek bond issue. "The European periphery obviously still presents highly attractive yields. The recent rally in bonds has pushed yields to record lows."

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Greece to Issue First Long-Term Bond Since Bailout

Wall Street Journal
April 9, 2014

Greece is poised to issue on Thursday its first long-term bond since its international bailout four years ago.

The country will sell at least €500 million ($689.9 million) of five-year bonds, according to one of the banks running the deal. People familiar with the matter said it could run to a total of €2.5 billion, and that yields will be around 5.25% to 5.5%.

Bank of America, Merrill Lynch, Deutsche Bank, Goldman Sachs, HSBC, J.P. Morgan Chase & Co. and Morgan Stanley are the banks hired to manage the sale.

The deal will cap an important milestone in Greece's rehabilitation following a crippling debt crisis that left the cash-strapped country frozen out of global bond markets and needing two bailout packages and a €200 billion debt restructuring to stave off financial collapse.

Booming demand for higher-yielding bonds amid record low interest rates, coupled with fading concerns about the euro-zone debt crisis, is also supporting Greece's return as investors ramp up exposure to countries they had previously given a wide berth.

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Greek rebound is astonishing

by Hugo Dixon

Reuters
April 8, 2014

Greece is undergoing an astonishing financial rebound. Two years ago, the country looked like it was set for a messy default and exit from the euro. Now it is on the verge of returning to the bond market with the issue of 2 billion euros of five-year paper.

There are still political risks, and the real economy is only now starting to turn. But the financial recovery is impressive. The 10-year bond yield, which hit 30 percent after the debt restructuring of two years ago, is now 6.2 percent.

Two of the country’s big four banks – Piraeus and Alpha – have raised 3 billion euros of equity between them in recent weeks to reinforce their balance sheets after a stress test orchestrated by the central bank. Eurobank, another big lender, is planning to follow suit with a 3 billion euro issue later this month.

The changed mood in the markets is mainly down to external factors: the European Central Bank’s promise to “do whatever it takes” to save the euro two years ago; and the more recent end of investors’ love affair with emerging markets, meaning the liquidity sloshing around the global economy has been hunting for bargains in other places such as Greece.

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Greece Nears Bond-Market Resurrection

by Ben Edwards

Wall Street Journal
April 4, 2014

Two years ago, Greece was forced to restructure its debts to avoid a default. Now it’s on the verge of making a bond-market comeback.

Earlier this week, the Greek finance minister Yannis Stournaras said the country would issue its first long-term bond since its international bailout by June. Some analysts reckon the deal could come sooner rather than later.

Commerzbank’s rates strategists said a likely upgrade of Greece by credit rating company Moody’s Investors Service on Friday “could do the trick” for the Greek debt agency “to dip a toe into the primary market over the next weeks, possibly as early as next week.”

Any deal would underscore what has been a remarkable turnaround for Greece, a country that many doomsayers had confidently predicted would exit the euro zone as it struggled to cope with mounting debts. Its debt pile was still at 175.6% of gross domestic product at the end of 2013–by far the highest in the euro zone. Even so, the planned bond sale is likely to be well received. Greece’s 10-year bonds were trading with yields a nudge above 6% Friday according to Tradeweb, the lowest since 2010. They were trading above 30% as recently as 2012. Yields fall as prices rise.

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Ευρωβαρόμετο: Οι Ελληνες πρωταθλητές στη "μαύρη εργασία"

Ημερησία
26 Μαρτίου 2014

Περίπου τρεις στους δέκα Έλληνες (30%) παραδέχονται ότι το προηγούμενο έτος, αγόρασαν αγαθά ή υπηρεσίες που ήταν προϊόντα αδήλωτης εργασίας. Το ποσοστό αυτό είναι το υψηλότερο στην «ΕΕ των 28» και έχει αυξηθεί δραματικά σε σχέση με το 2007 (όταν ήταν μόλις 17%), σύμφωνα με στοιχεία του ευρωβαρόμετρου για την αδήλωτη εργασία που δόθηκαν σήμερα στη δημοσιότητα.

Συγκεκριμένα, στο ερώτημα «έχετε πληρώσει αγαθά και υπηρεσίες με σοβαρές υποψίες ότι περιλάμβαναν αδήλωτη εργασία (χωρίς απόδειξη και ΦΠΑ), κατά τους τελευταίους 12 μήνες;», θετικά απαντά το 30% των Ελλήνων, έναντι 11% στην ΕΕ. Τα υψηλότερα ποσοστά καταγράφονται στην Ελλάδα (30%), στην Ολλανδία (29%), στη Λετονία (28%) και στη Δανία (23%). Τα χαμηλότερα ποσοστά καταγράφονται στη Μ. Βρετανία (8%), στη Γερμανία (7%) και στην Πολωνία (5%).

Στο ερώτημα «γνωρίζετε άτομα που εργάζονται χωρίς να δηλώνουν το εισόδημα ή μέρος του εισοδήματός τους στην εφορία;» θετικά απαντά το 54% των Ελλήνων (32% στην ΕΕ). Το ποσοστό αυτό είναι το τρίτο υψηλότερο στην ΕΕ μετά τη Δανία (59%) και την Ολλανδία (55%). Τα χαμηλότερα ποσοστά καταγράφονται στην Ιρλανδία (25%), στη Μάλτα, στη Ρουμανία (20%) και στη Μ. Βρετανία (15%).

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Greece Able to Call Its Own Tune

by Simon Nixon

Wall Street Journal
March 23, 2014

The euro crisis started in Greece, and it won't be over until doubts over Greece's prospects are erased.

That this is still some way off was clear from Greece's latest bailout review, the longest and most attritional yet. After seven months of haggling, the troika of official lenders—the European Commission, the European Central Bank and the International Monetary Fund—reached a deal last week that should be formalized by European Union finance ministers next month. It paves the way for the release of €8 billion ($11 billion) needed to repay maturing bonds.

But the striking feature of this agreement was the extent to which Athens got its way on vital issues relating to the budget, bank recapitalization and structural reform. That is a mark of how far a recovering economy, buoyant markets and increasing confidence in Prime Minister Antonis Samaras have changed the terms of engagement.

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Golden Dawn: courage of two women stems the rise of Greece's neo-Nazis

by Helena Smith

The Observer
March 23, 2014

For half a year they have sat in their seventh-floor office, probing the murky depths of Europe's most violent political force. It is not a mission that many would envy. But Ioanna Klapa and Maria Dimitropoulou, long-time friends who belong to Greece's first generation of female judges, have gone about the business of dissecting Golden Dawn with the precision of a surgeon.

After trawling though computers confiscated from the far-right party's leaders, examining witnesses and wading through thousands of videos, pictures, speeches, documents and blogs, the court officials have compiled a 15,000-page dossier outlining why they believe Golden Dawn is a criminal organisation.

Under the weight of their inquiry – spurred by the murder of a leftwing musician at the hands of a senior party operative in September last year – the extremist group has begun to crack. Last week one Golden Dawn MP resigned, citing ignorance of the party's activities. Another was expelled after indicating that he, too, was about to leave.

"The justice system is one of the few meritocratic institutions in Greece and both of these women are known to be enormously courageous, fiercely independent and non-partisan," said Aliki Mouriki, a sociologist at the National Centre of Social Research. "For a party that is so macho and militaristic, it is an irony of history that two women should now be in this role."

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For Greek Workers, a Dreaded Day Arrives

by Stelios Bouras

Wall Street Journal
March 22, 2014

Last year, soon-to-be-unemployed school guard Eleni Pappa faced an ugly dilemma: which of her two children would have to give up their studies.

Ms. Pappa, who didn't have the money to pay for both, decided her 23 year-old son should cut short his college studies in northern Greece, return home, find a job, and help pay for his younger sister's tutoring lessons.

"I was forced to make a choice between my two children. My son has another two years to complete his degree," said Ms. Pappa. "Now he is in Athens handing out fliers for a living."

The 50-year-old, who until recently worked at a school in the posh Athens suburb of Psychiko, is a casualty of the Greek government's promise to lay off and transfer tens of thousands of public-sector workers in exchange for aid. Last year, she was among the first of those thousands to be placed in a labor reserve pool where the government had eight months to find her a new job, or let her go. That deadline expires on Monday, marking the arrival of the day Ms. Pappa has dreaded for months. There is no new job waiting for her.

"The way things are going we are heading for the soup kitchen," said Ms. Pappa, whose family will rely solely on her husband's 800-euro-a-month salary.

For the first time in more than a hundred years, Greece is sacking public servants.

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Greece From Exit to Recovery?

Brookings Institution Press
June 2014

Two Greek economic analysts explain the Greek financial crisis—from beginning to end.

The first section of Greece: From Exit to Recovery? explores the lead up to to Greece’s adoption of the euro. Authors Theodore Pelagidis and Michael Mitsopoulos believe that the ensuing challenges were foreseeable. In fact, the authors posit that it was Greece’s difficultly in dealing with those challenges that sparked the euro crisis.

Section II analyzes discrete sectors of the economy, paying special attention to labor and finance—and the mistakes creditors made in focusing on reducing Greek incomes—rather than increasing competitiveness on non-labor costs.

Section III investigates why Greek companies spend relatively little on research and development. The authors’ analysis indicates that policy decisions largely determine R&D performance in the private sector, and they advance a number of specific policy proposals to improve the situation.

Statement by the European Commission, the ECB and the IMF on Greece

International Monetary Fund
Press Release No. 14/112
March 19, 2014

Staff teams from the European Commission (EC), European Central Bank (ECB), and International Monetary Fund (IMF) have concluded their review mission to Greece. The teams have reached staff-level agreement with the authorities on policies that could serve as the basis for completion of the review.

The mission and the authorities agreed that the economy is beginning to stabilize and is poised for a gradual resumption of growth, broadly in line with our previous projections. Prices are adjusting and inflation remains well below the euro area average.

Fiscal performance is on track to meet program targets. Preliminary estimates suggest the 2013 primary balance target was met with a substantial margin. While only a small portion of this over-performance will carry over into 2014, we believe that the 2014 fiscal targets will also be met, taking into account the measures being implemented and planned. The authorities reconfirmed their commitment to implement policies needed to achieve the 2015 primary surplus target of 3 percent of GDP, including as needed by extending expiring fiscal measures, such as the solidarity surcharge.

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ΕΛΣΤΑΤ: Στα 181,1 δισ. ευρώ συρρικνώθηκε το AEΠ της Ελλάδας το 2013

Τα Νέα
12 Μαρτίου 2014

Στα 181,1 δισ. ευρώ ανήλθε το Ακαθάριστο Εγχώριο Προϊόν της Ελλάδας το 2013, έναντι 193,3 δισ. ευρώ το 2012, όπως ανακοινώθηκε από την Ελληνική Στατιστική Αρχή.

Η ΕΛΣΤΑΤ ανακοίνωσε την Τετάρτη την πρώτη εκτίμηση του Ακαθάριστου Εγχώριου Προϊόντος για το έτος 2013 καθώς και την αναθεωρημένη εκτίμηση για το έτος 2012. Οι εκτιμήσεις αυτές έχουν υπολογιστεί από το άθροισμα των αντίστοιχων τριμηνιαίων αποτελεσμάτων. Σύμφωνα με τις ακολουθούμενες από την ΕΛΣΤΑΤ διαδικασίες, προβλέπεται και δεύτερη εκτίμηση του ΑΕΠ για το έτος 2013, η οποία είναι προγραμματισμένη να ανακοινωθεί στις 10 Οκτωβρίου 2014. Η δεύτερη εκτίμηση θα αντικατοπτρίζει την ολοκλήρωση των εν εξελίξει στατιστικών εργασιών αναθεώρησης των ετήσιων εθνικών λογαριασμών.

Ειδικότερα, το ΑΕΠ το 2013 ανήλθε σε 182,1 δισ. ευρώ, έναντι 193,3 δισ. ευρώ το 2012, σημειώνοντας μείωση κατά 5,8%.

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Greece 'On Course for Growth'

Wall Street Journal
March 11, 2014

Greece's economy contracted less than expected in the fourth quarter of last year, helping the country's finances get off to a good start in 2014, according to figures published Tuesday.

Fresh data from Greece's statistics service, Elstat, for the October-December period showed that gross domestic product contracted by an annual rate of 2.3% in the last quarter of 2013, less than a previous flash estimate of a 2.6% contraction.

It was the economy's best performance since the first quarter of 2010.

The latest snapshot of the Greek economy boosts hopes that it will return to growth this year after six years of contraction. According to current budget forecasts, Greece's economy is officially expected to expand by 0.6% in 2014.

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What Makes Greece Special?

by Daniel Gros

Project Syndicate
March 6, 2014

The euro crisis seems to be largely over. Risk premiums continue to fall across the board, and two countries – Ireland and Portugal – have already exited their adjustment programs. They can now finance themselves in the market, and their economies seem to have started growing again.

By contrast, Greece is still having problems fulfilling the goals of its adjustment program and is engaged in seemingly endless negotiations over yet another multilateral financing package. The problem can be summed up in one word: exports (or, rather, lack of export growth).

The news from Greece these days has been dominated by the announcement that the government achieved a primary budget surplus (the fiscal balance minus debt service) in 2013. For the first time in decades, the Greek government has been able to pay for its expenditure with its own revenues.

This is indeed a milestone. But another, much more important news item has received much less attention: Greece exported less in 2013 than in 2012.

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