Skip to main content

The Troika’s Policy in Greece: Rob the Greek people and give the money to private banks, the ECB, the IMF and the dominant States of the Eurozone

On 20 August 2018, the Greek government of Alexis Tsipras, the IMF and the European leaders celebrated the end of the Third Memorandum.

On this occasion, the major media and those in power spread the following message: Greece has regained its freedom, its economy is improving, unemployment is on the decline, Europe has lent Greece 300 billion and the Greeks will have to start repaying that debt in 2022 or in 2032.

The main claims are completely unfounded as Greece remains under the control of its creditors. In compliance with the accords that the Alexis Tsipras government signed, the country must imperatively achieve a primary budgetary surplus of 3.5% which will force it to continue brutal policies of reduction of public spending in the social sector and in investment. Contrary to the dominant message that Greece will not begin to repay its debt until some time in the future, it should be clearly understood that Greece has been repaying considerable amounts constantly all along to the ECB, the IMF and to private creditors, and this prevents it from responding to the needs of its population.

by Eric Toussaint

Part 17 - Looking back at how Greek banks responded to the public debt

We should emphasize that between December 2008 and December 2009, Greek banks had increased their purchase of Greek public securities by 33%. In December 2008, Greek banks held €30 billion in Greek securities while one year later the amount reached €40 billion. This shows that Greek banks derived profits from holding Greek securities at a time when the IMF and the ECB’s director claimed that the Greek treasury was heading for disaster.

Later, between December 2009 and December 2010, Greek banks somewhat reduced the number of Greek securities they held. It fell from €40 to 36 billion on 31 December 2010. Yet if we add their purchase of short-term public securities (treasury bills under one year), the total amount stays at €42 billion. This clearly shows that they were not anticipating the Greek State to default and that they derived several advantages from holding those securities while international media ran big headlines on the sovereign debt crisis in Greece!

Only in 2011 did Greek banks significantly reduce the number of Greek securities over one year; it fell from €36 billion on 31 December 2010 to €24 billion in December 2011. On the other hand Greek banks increased their purchases of short-term Greek securities by 40%, from €5.8 billion to €8.3 billion.

How can this be explained?

Easily enough: Greek banks know that a restructuring of the Greek debt is being negotiated and that the value of securities will be cut, so they cautiously resell some of them. But they are also told that they will receive compensations and thus feel reassured. Besides, holding short-term securities (3, 6 or 9 months) further reduces the risk banks run since they can decide not to keep them if they consider that a risk becomes likely. There is another explanation for their buying securities under one year: these will not be affected by value cuts, but will be paid at 100% at maturity and yield high interests.

Moreover if Greek banks keep a lot of Greek debt securities in their assets, it is also because these increase their equity/total assets ratio, as explained above. Lastly, since the ECB maintained its credit line to Greek banks, they can exchange their Greek securities against the liquidities they need.

Greek banks had been helped in 2008-2009, and they were bailed out again with public money. Indeed, part of the loans granted in the context of the first MoA was injected into Greek banks. The four largest Greek banks thus increased their hold on the Greek banking market as they absorbed smaller ones. Not only did those large banks claim they had suffered losses and thus eschewed taxation but they carried on with their mafia practices (see illustrations developed by Daniel Munevar about the Proton and Piraeus banks in “Greece: The PSI and the process of bank recapitalization (2012-2016)”, http://www.cadtm.org/Greece-The-PSI-and-the-process-of). Not one single bank executive was imprisoned. Greek banks moved as much capital abroad as they could when their country’s economy badly needed them. The proportion of non-performing loans increased. Banks cut off loans to households and SMEs.

Source, links, references:


[1] [2] [3] [4] [5] [6] [7] [8] [9] [10] [11] [12] [13] [14] [15] [16] [18] [19] [20] [21]

Related:


Comments

Popular posts from this blog

Oct. 7 Reports Implode: Beheaded Babies, NY Times Scandal, & More

Glenn Greenwald    

Israel’s Descent Into Madness & the Holocaust Comparison

BreakThrough News   Rania Khalek was joined by Tarik Cyril Amar, a historian from Germany and associate professor at Koc University in Istanbul, to discuss Israel’s descent into genocidal fascism. Prof. Amar addresses whether it’s useful to make Holocaust and Nazi comparisons and the real reason behind the West’s unshakeable loyalty attitude when it comes to Israel’s barbarism.   

Zionist and US imperialist criminals are about to grab the natural gas off shore Gaza

globinfo freexchange   As the genocide against Palestinians of Gaza is about to be completed with an act of unprecedented brutality by the Zionists and butcher Netanyahu through the bombardment of about 1.4 million civilians in Rafah, it seems that they have already set their next primary goal. Which, in short, is to grab the natural gas resources off shore Gaza, together with their US imperialist buddies whose contribution to the genocide has been undoubtedly critical.     As already reported , in 2007, Hamas came to power and Israel launched an offensive on Gaza Strip, leaving behind 1,400 dead Palestinians, but taking with it the gas fields. Within a year, Israel announced the discovery of the Leviathan natural gas field, which did include Gaza's riches, valued at 453 billion dollars. But Gazans have been denied around 47 billion dollars in revenue. As for Tel Aviv, it's gunning to become a new hub. At that moment in time, that is 2022, Russian oil and gas were sanctioned.

Neocon Queen Victoria Nuland Ends Her Reign: Exposing a Catastrophic Career

Glenn Greenwald    

Το σκάσιμο της φούσκας Μητσοτάκη με νέα επίσημη χρεοκοπία και οριστικό τέλος της μεταπολίτευσης

του system failure   Τα αποτελέσματα των εκλογών της 25ης Ιουνίου ήταν λίγο-πολύ αναμενόμενα όσον αφορά τις πρώτες θέσεις με βάση και τα αποτελέσματα της πρώτης κάλπης του Μαίου. Αν συμπεριλάβουμε και το ποσοστό της αναμενόμενης αποχής, δεν μας έδωσαν κάποια ιδιαίτερη έκπληξη. Αυτό όμως που φαίνεται να αιφνιδίασε ακόμα και το συστημικό κατεστημένο, είναι η είσοδος των δύο υπερσυντηρητικών, ακροδεξιών κομμάτων Νίκη και Σπαρτιάτες, με το τελευταίο να έχει ξεκάθαρες διασυνδέσεις με τον πρώην Χρυσαυγίτη, Ηλία Κασιδιάρη. Παρά τη μεγάλη νίκη Μητσοτάκη, οι μιντιακοί ινστρούχτορες της καθεστωτικής προπαγάνδας εμφανίστηκαν σε γενικές γραμμές "μουδιασμένοι" και αυτό οφείλεται στο γεγονός ότι το συστημικό κατεστημένο (δηλαδή τα μεγάλα οικονομικά συμφέροντα που ελέγχουν και το σύνολο των μεγάλων ΜΜΕ πανελλαδικής εμβέλειας), πέτυχε μόνο έναν από τους τέσσερις μεγάλους στόχους που είχε θέσει εξ'αρχής. Μιλώντας με ποδοσφαιρικούς όρους, ουσιαστικά έχασε με σκορ 3-1.   Ο μεγάλος στόχος πο

Τυχαία γεγονότα στην τριτοκοσμική μπανανία των Βαλκανίων

failed evolution   1) Συμβαίνει το μεγαλύτερο σιδηροδρομικό δυστύχημα στην ιστορία της χώρας. 2) Γίνεται αστραπιαία επιχείρηση μοντάζ των συνομιλιών του σταθμάρχη από μηχανισμό του καθεστώτος, πριν ακόμα φτάσει στα χέρια των αρχών, προκειμένου να αποδοθεί η τραγωδία αποκλειστικά σε ανθρώπινο λάθος και να βγουν από το κάδρο οι πολιτικές ευθύνες ανώτατων κυβερνητικών αξιωματούχων. 3) Αναπαράγεται το παραποιημένο υλικό αστραπιαία από ναυαρχίδα της καθεστωτικής προπαγάνδας. 4) Τοποθετείται επικεφαλής στην επιτροπή-παρωδία πρωτοπαλίκαρο του καθεστώτος Μητσοτάκη που εργάζονταν παλιά στην ίδια αυτή ναυαρχίδα. 5) Η επιτροπή κλείνει άρον-άρον την υπόθεση αποκλείοντας ουσιώδεις μάρτυρες που είχαν προειδοποιήσει επανειλημμένα τον αρμόδιο υπουργό για τον κίνδυνο μεγάλου δυστυχήματος. Σταματάει έτσι και η όποια σε βάθος διερεύνηση για την τσιμεντοποίηση του χώρου και την απόπειρα συγκάλυψης της τραγωδίας.  

The Shadowy, Intelligence-Linked Group Driving the US Towards War With Iran

"United Against Nuclear Iran does not miss an opportunity to try to bring the United States closer to a military conflict with Iran. And on the other side of the equation, they also have worked very hard to oppose efforts to de-escalate the U.S.-Iran relationship."   by Alan Macleod   Part 7 - A Lesson From History   The history of Iran has been intimately intertwined with the United States since at least 1953 when Washington orchestrated a successful coup against Prime Minister Mohammad Mosaddegh. Mosaddegh had refused U.S. demands to stamp out Communist influences in his country and had nationalized the nation’s oil. The U.S. installed Shah Mohammad Reza Pahlavi as a puppet ruler. An unpopular and authoritarian ruler, the Shah was overthrown in the Revolution of 1979. Since then, it has become a target for regime change, and its nuclear program is something of an obsession in the West. Often orchestrated by UANI officials while they were in government, the U.S. has carried

How the CIA oversees the Ukraine proxy war on Russia

Geopolitical Economy Report   Several reports in mainstream US media outlets show how the CIA has helped to direct the proxy war against Russia in Ukraine, and played a role in causing the conflict in the first place. Ben Norton examines the evidence.   Related: Confirmed: US imperialists wanted to drag Russia into a war with Ukraine since at least 2019

Israel Carries Out Most Sadistic Massacre, Opens Fire On Gaza Aid Convoy

Richard Medhurst  

The real reason behind TikTok ban

Glenn Greenwald /  Richard Medhurst