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Greece budget deficits miss bailout targets- Look out Wall St!

JEDI

JEDI

Lifer
http://money.cnn.com/2011/10/02/news/international/greece_budget/index.htm?source=cnn_bin&hpt=hp_bn5

The Greek cabinet announced late Sunday that it adopted a draft budget for 2012, but the debt-ridden nation will miss key deficit targets for this year and next.

According to this preliminary budget, Greece's budget deficit will be 18.69 billion euros, or 8.5% of gross domestic product, in 2011. Greece had originally agreed to a deficit of 17.1 billion euros, or 7.8% of GDP, with the International Monetary Fund, European Commission and the European Central Bank.


omg.. how stupid is the Greek govt?!?
to get the bailout loan, greece agreed to do X. yet when it was time to put up, they renigged.

They just commited suicide.
kiss future bailout $$$ goodbye!
kiss Greece goodbye!

Wall street is going to plummet like a sinking stone on Mon
 
They will default on their debt, Turkey will invade them, and WWIII will begin with the assassination of Serbia's Prime Minister.
 
Well, if the Euro is to survive, that means the Greek govt will have to survive, and it won't if too much austerity is demanded.

Greeks will revolt, denounce the debt entirely, start over with their own currency. Their creditors will end up with zero, rather than some fraction of the total debt greater than zero.

It's a game of chicken wrt how much of a haircut their creditors will have to take, complicated by the existence of OTC derivatives. If the Greeks are forced to default, they'll likely drag a few of their creditors along with them, who may well be in the position of failing if they take any sort of haircut at all. Many of them are already weakened from taking huge write downs over the Ownership Society, Iceland, and the situation wrt other debtor nations like Spain, Ireland, etc.

Credit bubbles and the false prosperity involved are like that. Not to worry, though- the decision makers are richer than ever, even if they'll have to shoot their corporate steeds... push down the living standards of the subject populations, too.
 
I dunno why you think Wall Street needs to watch out, this has been priced in for a while. The fact that Greece is going to eventually default has been the worst kept secret on the world economic scene for months now.
 
I'm guessing that Greece just hasn't spent enough to get itself out of this mess, we need Obama to get this countries financial house in order.
 
Jhhnn said:
Well, if the Euro is to survive, that means the Greek govt will have to survive, and it won't if too much austerity is demanded.

Greeks will revolt, denounce the debt entirely, start over with their own currency. Their creditors will end up with zero, rather than some fraction of the total debt greater than zero.

It's a game of chicken wrt how much of a haircut their creditors will have to take, complicated by the existence of OTC derivatives. If the Greeks are forced to default, they'll likely drag a few of their creditors along with them, who may well be in the position of failing if they take any sort of haircut at all. Many of them are already weakened from taking huge write downs over the Ownership Society, Iceland, and the situation wrt other debtor nations like Spain, Ireland, etc.

Credit bubbles and the false prosperity involved are like that. Not to worry, though- the decision makers are richer than ever, even if they'll have to shoot their corporate steeds... push down the living standards of the subject populations, too.
Click to expand...

Their creditors already expect a default. That is why their bond rates are at "recovery" prices.
 
Jhhnn said:
Greeks will revolt, denounce the debt entirely, start over with their own currency. Their creditors will end up with zero, rather than some fraction of the total debt greater than zero.
Click to expand...

The only problem with that is that new currency is going to plummet so fast, it won't be worth the money it's printed on. Which is going to suck for greek citizens.
 
Argo said:
The only problem with that is that new currency is going to plummet so fast, it won't be worth the money it's printed on. Which is going to suck for greek citizens.
Click to expand...

This,
they will have zero purchasing power going forward, but they'll be ever so exciting by sticking it to the "man".
 
RbSX said:
I dunno why you think Wall Street needs to watch out, this has been priced in for a while. The fact that Greece is going to eventually default has been the worst kept secret on the world economic scene for months now.
Click to expand...

maybe, since the futures markets aint reacting much. just slightly down as of 20min ago.
 
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Argo said:
The only problem with that is that new currency is going to plummet so fast, it won't be worth the money it's printed on. Which is going to suck for greek citizens.
Click to expand...

Greek citizens are part of the reason they're in the mess. They demanded more than what could be reasonably delivered (and the government gave in to the demand) and now are pissed off because what was delivered is being taken away.
 
halik said:
Italy did the very same swaps in 1997... worked out for them.
Click to expand...

The size and scope were different, and there were different regulations for EU countries in place in 1999.

The point remains that the scale of Greece's problems have alot more to do with capitalism than socialism.
 
halik said:
This,
they will have zero purchasing power going forward, but they'll be ever so exciting by sticking it to the "man".
Click to expand...

Dunno about that. Greeks will take whichever way looks the best to them, so it's up to their creditors to make the pain of non-default less than the pain of default so they can get half a loaf rather than nothing.

If Greece goes down, Spain and Italy will likely follow in a frenzy of speculative throat cutting, dragging the European banking community in general along with them, possibly some of our own, too.

The only way that's good for business is that it's good for vultures, of which there are more than a few.
 
HendrixFan said:
The size and scope were different, and there were different regulations for EU countries in place in 1999.

The point remains that the scale of Greece's problems have alot more to do with capitalism than socialism.
Click to expand...

No, Maastrich criteria were the same for all the members. Italy's Finance Ministers took on a position with a view that panned out, Greece's Finance Ministers took on a position with a view and it went in their face.

http://glossary.reuters.com/index.php/Maastricht_Criteria

http://www.euromoney.com/Print.aspx?ArticleID=1003330
 
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HendrixFan said:
The size and scope were different, and there were different regulations for EU countries in place in 1999.

The point remains that the scale of Greece's problems have alot more to do with capitalism than socialism.
Click to expand...

Yup. That's a truth so simple that Righties will deny it with their dying breaths.
 
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