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When politics get in the way of governing

The first electoral test since Greece came under foreign stewardship is not only a major disappointment already but could also become a danger to the country’s recovery. The municipal and regional elections, which are being held in accordance with a radical reorganization of constituencies, were intended to usher in a new era in local government. But instead of leading to citizens having greater influence over their lives, the elections have turned into yet another dialogue of the deaf and the indifferent. All the parties are using next Sunday’s ballot as a referendum on the memorandum signed between Greece and its partners last May. All see the deal from the angle that suits them.

The PASOK government describes the 110-billion-euro bailout as a necessary evil that was the only way to stave off bankruptcy, while main opposition New Democracy makes the bizarre claim that, under its wise stewardship, Greece could have wiped out its deficit by the end of next year, i.e., slashing it by over 15 percent without the aid or conditions set by any pesky international organizations. Even the wildly populist, extreme-right LAOS party saw the merits of the bailout and not only in its demand for radical reforms and austerity. The leftist parties are, as always, in a separate universe, where outlawing capitalism would turn everyone rich overnight, making Greece’s problems and the effort to rehabilitate the country irrelevant. It is increasingly evident that this political personnel is incapable of leading the country out of the mess that it got it into.

It must be said that Prime Minister George Papandreou’s government has done more than any other to tackle the enormous problems that have accumulated over decades of political incompetence and interest groups’ bulimia but New Democracy is right to claim that PASOK’s delay in taking action after October’s national election cost the country dearly in terms of lost credibility. The opposition party, however, conveniently forgets that it was during its last watch that Greece’s economy spiraled out of control. ND replies to the charge with the claim that it was PASOK that burdened Greece from 1981 onward with debts that it could never repay. All the parties are complicit in doing all they could to spend public funds to curry favor with the largest number of citizens and the greatest number of interest groups. As the interests of these two constituencies both overlap and contradict each other, it was only through massive waste that both could be sated. So, while all should share the blame and each should try to make themselves useful in the new economic landscape, they all stick to failed policies, accusations and counteraccusations of the past.

At a time when Greece’s cities, towns and villages will be severely challenged by the shortage of public funds and by the needs of ever greater numbers of poor people, it is imperative that those who are contesting the elections should offer a vision of how society can be protected from the storms and how citizens and immigrants will be cared for and shepherded toward a brighter future.

Seeing how the political parties are incapable of breaking out of their tail-chasing madness, we hoped that independent individuals would leap into the breach. Some did, most notably Giorgos Kaminis, the highly respected former Ombudsman who is running for mayor of Athens. He is backed by PASOK and the new Democratic Left party, which splintered from the Left Coalition. The incumbent, Nikitas Kaklamanis, is backed by New Democracy. Kaklamanis’s record in Athens over the past four years speaks for itself, for good and ill. Kaminis’s successful stint as Citizens’ Ombudsman will have prepared him well for tackling the capital’s decline but it seems his idealism and inexperience have not dented Kaklamanis’s hopes for re-election. Whoever is elected will have to find a way to lead Athens through its most difficult time in many decades – with very little help from the parties that back him. Things are very difficult but it is only at times like this that we can expect change. The omens are not good but we have to hope.

(Kathimerini.gr)

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Un altro commento politico per capirne di più ...
 
Analysts Comment On Rising GGB Spreads



The uncertainty created due to the possibility that Greece may proceed to snap elections and the fact that the decisions of the European summit were not clear enough in terms of the policy direction that will be followed to address the debt crisis across the eurozone, are the main reasons of the rising Greek Government Bond spreads, analysts tell Capital.gr.

It did not become clear that Europe will act towards eliminating the risk of a recurrence of a larger debt crisis, said Alastair Newton, Senior Political Analyst at Nomura. This is reflected at the nervousness of the market at the moment, with the bond spreads throughout Europe, including Greece, widening again, he adds, noting that there will not be another crisis in the eurozone, but many risks remain, despite the great progress that countries, notably Greece, have made in structural reforms.

“The upcoming elections in Greece will be an important test for the popularity of the Papandreou government and hopefully the results will not lead Papandreou to call national elections, since this would further destabilize the markets,” he stressed.

On the other hand, the fact that Finance Minister George Papaconstantinou said for the first time the 2009 budget gap will exceed 15% in 2009, and the negative comments by Pimco’s El-Erian, combined with the possibility of snap elections, raised concerns, said Ioannis Sokos, a London-based interest rate strategist at BNP Paribas.

(Capital.gr)
 
Daily Telegraph: Greece Needs Orderly Bankruptcy



An orderly bankruptcy in the form that is usually engineered by the International Monetary Fund is exactly what Greece needs, as “Greeks are being subjected to the full pain of austerity under false pretences, without being offered the cure of debt relief,” Daily Telegraph says.

In a story published Sunday, the British daily notes that bondholders should bear the burden of making wrong investment choices and should have been punished for their errors long ago.

“An orderly bankruptcy along lines routinely engineered by the International Monetary Fund is exactly what Greece needs. It makes no sense to push Greece further into a debt compound spiral by raising public debt from 115pc of GDP at the outset of the “rescue” to 150pc at the end of the ordeal,” it says.

The story notes that the “Greek package allows banks and funds to shift roughly €150bn of liabilities onto EU governments, or the European Central Bank, or the IMF…it is in reality a bail-out for investors.”

(Capital.gr)

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:squalo:
 
Greek Market Inches Down On Monday



Athens stocks are weaker on Monday, after three negative sessions, with the banks remaining in the spotlight.

Analysts say that under the present circumstances, it will be hard to find catalysts that may push the market higher, and say that the possibility of snap elections will weigh in ATHEX.

“With the shift in the general climate being evident, affected both by statements of government officials concerning the result of regional elections as well as Piraeus΄ announced share capital increase, the Athens market is anticipated to regain its autonomous momentum, moving on slightly lower levels. Following Friday΄s selloff, the latter being the 3rd consecutive negative trading session during which the equities of the banking sector realized cumulative losses of more than 7% (Alpha Bank, Eurobank: -13.1%, Piraeus: -7.9%, NBG: -7.3%), we expect pressures to gradually ease off. Technically, we note that although the GI broke with ease the levels of the 1,570 units (slide-ascending trend line), its drop halted on the 1,530 units, the latter consisting the levels of the 30-days moving average. This consists today΄s resistance level, with the GI΄s upper intraday limit standing just above the 1,550 units,” Pegasus Securities says.

Across the board, the General Index drops 0.72% at 1,536.34, on a total turnover of 29.83 mil. euro.

(Capital.gr)
 
UE, Juncker esorta Bce a parlare con una sola voce

lunedì 1 novembre 2010 11:36




BERLINO, 1 novembre (Reuters) - La Banca centrale europea dovrebbe parlare con una voce sola.
Lo ha detto il presidente dell'Eurogruppo Jean-Claude Juncker in un'intervista a un quotidiano tedesco Die Welt.
I commenti di Juncker fanno seguito alla critica al programma Bce di acquisto di bond mossa dal presidente Bundesbank Axel Weber, membro del Consiglio direttivo della BCE, che innescato un rimprovero dal suo presidente Jean-Claude Trichet [ID: nSGE69G00A] [ID: nLDE69B266].
Juncker, che è primo ministro del Lussemburgo e presiede le riunioni dei ministri delle Finanze della zona euro, ha aggiunto che, su richiesta della Bce, aveva fatto in modo che vi fosse "una sorta di disciplina verbale" nell'ambito dell'Eurogruppo.
"Vorrei che fosse anche il caso della Bce" ha aggiunto.
Il meeting di politica monetaria della Bce di novembre si terrà giovedi. Si prevede che mantenga i tassi di interesse invariati all'1% per il 18mo mese di fila e che aspetti fino a dicembre per decidere se eliminare gradualmente le sue misure di sostegno monetario.
 
si continua a discutere di ristrutturazione del debito

...in considerazione di un fututo prossimo europeo e non solo di stagnazione economica, mi viene da pensare che le probabilita' di considerare il debito di uno stato come quello di una corporate sia sempre piu' possibile.

L'emissione di nuovo debito in sostituzione del precedente con taglio del nominale non e' da scartare a questo punto, dal momento che dopo tutti gli sforzi fatti ed i traguardi raggiunti si continua a discutere sul default.

:ciao: E' vero, si continua a discutere di questa soluzione, e la cosa ovviamente non mi fa piacere: però stamane le quotazioni tengono, fino adesso. E io tengo duro :boxe:.
Buona mattinata agli amici.
Ciao, Giuseppe
 
Arab Money And Fear Of the Turks Saves The Day



November 1, 2010: Greece has finally worked out a deal to pay for the four Type 214 submarines it had bought from Germany. Greece will promptly pay $278 million to the German manufacturer, and turn over a majority (75.1 percent) interest in a Greek shipyard (that is building the other two Type 214s) to an Arab firm. The German manufacturer had invested heavily to upgrade that shipyard so that it could build the other submarines. In this case, the yard will continue building the other two subs, and German cooperation will continue.

Only a month ago, the Greeks were faced with having their Type 214 subs auctioned off to cover the $800 million they owned the German builder. Although the final deal had been in the works for over a year, the Greeks were unable to muster the fiscal and political capital to make it happen. Because of the current financial crises, the Greek government claimed that the cash was not available, and not likely to be for some time. But the Greeks finally worked out a deal that did not include an auction, and will receive one of the Type 214s within a month, and the other three boats as soon as work is done on them.



Late payment has not been the only problem with these subs. For the last four years, Greece and German submarine builder ThyssenKrupp have been arguing over the quality of German work on the Type 214 boats. But earlier this year, the Greeks finally agreed to the original deal, and declared the quality issues resolved. It was about time. But four years ago, when the first Type 214 arrived from Germany, the Greeks quickly declared that the boat suffered from 400 defects.



When the Germans first heard of the complaints, they thought it was politics. A new Greek government had just been installed, and it was common for the new officials to try and make the previous gang look bad. The Germans also expected that the Greeks were using this defect list to renegotiate the contract, and pay less than they had agreed to. The Germans eventually concluded that nearly all the 400 defects were bogus.
Finding that that all the claims were false or exaggerated, the Germans sued for breach of contract. The Greeks responded by refusing to accept the sub, which remained tied up in Germany. Then the Germans threatened to withdraw technical help for the Greek shipyard that was building the other three boats, and go to court to prevent the Greeks from using any of the German technology.



Two years ago, the Greeks offered to settle the dispute, but they didn't have the cash to make the required payments. That deal had the Greeks accepting the first sub, and then selling it. The Greeks still wouldn't admit that their defect list was a fraud. The Germans agreed to resume assisting the Greek shipyard, and withdraw its lawsuits. Greece promised to make required payments, which was not done.



It's believed that Greece's current financial problems (spending more than they promised the European Union that they would) was a major factor in all the contract problems over the last year. This debt problem has forced the government to cut way back on spending. That, plus the German threat to, in effect, shut down the Greek shipyard, and throw 1,400 people out of work, forced the government to back down on the crises it had created. But the cash was simply not there to pay for the subs, so other sources of funding were sought, and eventually found via the Arab partner.
Meanwhile, Greece has eight German Type 209 subs. These 1,100 ton boats entered service in the 1970s and are being kept in service via regular upgrades and refurbishment. The 214s (ultimately eight of them) were to replace the 209s. If that deal had actually died, the Greek submarine force would have just faded away over the next decade or so. Archrival Turkey has bought six Type 214s, with the first arriving in five years. The thought of the Turks having 214s, while the Greeks had none, may have been the real catalyst to sorting out this mess.


(Strategy Page)


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:ciao: E' vero, si continua a discutere di questa soluzione, e la cosa ovviamente non mi fa piacere: però stamane le quotazioni tengono, fino adesso. E io tengo duro :boxe:.
Buona mattinata agli amici.
Ciao, Giuseppe

Questa mattina lo spread/bund ha aperto in allargamento, ora recupera posizioni riportandosi intorno alla chiusura di venerdì intorno a 815 pb.
Settimana prossima ci sono le aste, spero si presentano un pò meglio rispetto agli ultimi giorni ...
 
spread in recupero

Questa mattina lo spread/bund ha aperto in allargamento, ora recupera posizioni riportandosi intorno alla chiusura di venerdì intorno a 815 pb.
Settimana prossima ci sono le aste, spero si presentano un pò meglio rispetto agli ultimi giorni ...

Mi sembrava che in genere i prezzi tengono bene :)
Ciao, Giuseppe
 
Mi sembrava che in genere i prezzi tengono bene :)
Ciao, Giuseppe

Diciamo che tra i minimi della scorsa settimana intorno a 670 pb. e i massimi registrati nel periodo estivo a quasi 1000 pb., l'allargamento di questi giorni ci ha riportati a metà strada.
Giusto in tempo per ridiscendere ... si spera :titanic:.
 
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