Gorilla's Blog

Reuters headline: “Banks Move Closer To Deal On Greek Bailout”

The correct headline: “Banks Move Closer To Bailout From Greece”

What’s appalling is the Greeks don’t seem to understand, in the same way the White House doesn’t understand about the debt ceiling kabuki with the Know Nothings, that indeed they have all the leverage.

Leaving the Euro, defaulting on the debt, devaluing the drachma, and becoming internationally more competitive: all solutions available to Greece and all likely to lead to economic recovery in less than a generation.

Sarkozy and Merkel fundamentally are cowards. They’re not willing to tell the truth about their banks to their own people. Calling their bluff is much easier than asking your fellow Greeks to commit national suicide.

Gorilla says: “Say no to austerity, say hello to the future!”

German Finance Minister Wolfgang Schaueble: “It’s a fine line. On the one hand it has to be voluntary, because otherwise there will be consequences, but on the other hand it must also lead to a result. We will continue to work on that.”

Gorilla translates: “We need volunteers who volunteer large amounts of cash in a non-contagious way.”

A second bailout of Northern European bankers appears to be on the cards…

And Greek conservatives, who presided over the sovereign debt mess and then covered it up, are as crazy as American conservatives: give us tax cuts and pile up more debt or we won’t go along!!!

Oh, and it looks likely that Northern European bankers will also need more money from Ireland, not to mention Portugal, Spain, Italy, and possibly France!!!

The level of denial, cowardice, and lying in Euroland is breathtaking. Very reminiscent of the current US non-approach to unemployment…

Gorilla says: “When you aren’t being honest with your own people, you can’t expect them to be happy about the disaster you’re giving them!”

Now, it’s the ECB, who say they won’t accept Greek debt as loan collateral unless the Greeks get more austere!

This empty threat once again disguises the reality: the Greeks need the loans to pay off their Northern European bankers.

The bankers will collapse if some form of extend and pretend and/or haircuts are agreed, and so far there’s no sign that Euroland authorities have either a plan or a serious understanding of what’s at state.

Gorilla says: “2013 has already started in Frankfurt, whether they know it or not!”

The IMF doesn’t think Greece is austere enough!!!

The obvious answer, Greece leaving the Eurozone and defaulting, is not being discussed at all.

A sensible alternative, namely giving haircuts to Greek bondholders on the order of 50%, is not being discussed seriously, because the Germans, French, and Dutch aren’t terribly interested in watching their banks collapse.

So, there’s silly talk about “reprofiling”, which is essentially Extend And Pretend: The Sequel.

Gorilla says: “It’s not exactly the hottest ticket in town!”