Obi-Wan Kenobi
/ 178.36.3.* / 2010-04-12 11:13
The Jawbone Continues: Greece
Greece was bailed out today, so says Bloomberg:
April 12 (Bloomberg) -- European governments offered debt- plagued Greece a rescue package worth as much as 45 billion euros ($61 billion) at below-market interest rates in a bid to stem its fiscal crisis and restore confidence in the euro.
Forced into action by a surge in Greek borrowing costs to an 11-year high, euro-region finance ministers said yesterday they would offer as much as 30 billion euros in three-year loans in 2010 at around 5 percent. That’s less than the current three- year Greek bond yield of 6.98 percent. Another 15 billion euros would come from the International Monetary Fund.
You sure about that?
EU leaders haven't yet agreed unanimously to offer Greece a bailout, according to a Wall Street Journal report that offered details about the potential plan. But ministers have made the terms of a potential deal public in an effort to reassure world financial markets, which have been unnerved by Greece's debt woes for months.
Oh.
So we "made details public" of something we don't have approval to do, and haven't actually done.
In other words, we're lying.
Again.
And then there's this, which is rather more explicit:
"This decision today was no decision on aid for Greece," Finance Minstry spokesman Michael Offer told Dow Jones Newswires. "But it was only about technical preconditions for aid by further specifying the decision of the heads of state and governments. We expect, we hope that Greece is now in a situation where it can continue to refinance itself on the capital markets, as previously."
That's rather explicit - we've not agreed to actually do anything!
Oh, and then there was this:
Offer said that if the aid plan were to be activated, this had to be preceded by a Greek request, followed by a separate decision process in which the heads of state and governments would "personally" and "unanimously" approve help, a recommendation by the European Commission and the European Central Bank for such aid as well as an assessment by the IMF, which would send a mission to Greece ahead of any aid package decision.
So we have two "wee problems" here:
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Each government involved will have to authorize the act, and all must agree. Many of them undoubtedly will have to actually pass bills authorizing this - that's no mean feat in and of itself.
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The IMF has to sign off, and it will impose additional austerity conditions, which Greece will have to agree to. Best-a-luck on that one.
But once again we see that the magic market pumpers come in with a headline, trumpeted loudly through the planet, that all is saved, when in point of fact nothing at all has actually been done, all designed to goose the markets once again (as if there's a "stability" problem with a market that has risen 80% from its lows. Oh wait - maybe it is a bit unstable with that sort of advance, eh? Hmmmm.)