Showing posts with label What is Greece. Show all posts
Showing posts with label What is Greece. Show all posts

Thursday, 3 September 2015

My Name is David and I am an Addict



My name is David and I'm an addict, it’s been almost no time at all since my last fix.

fugitiveMy habit began in the 90s when I first tried ‘Greece’ (check out the story of my arrival here). I had planned to stay for two weeks as many of you have but I was maybe more vulnerable than most. I stayed for seven months. The pressure at work was getting to me and Greece had all the answers, ‘life’s a beach’. I quickly met a commune of other addicts and we laughed at you. You work like ants all year, eating bake beans on toast in order to enjoy what we had for free. NO, we were getting paid for it. We all had jobs in the tourist industry, serving your souvlaki, thrilling you with jet-ski rides, taking you on tours of culture and ancient history, from the country that gave you civilisation. I was not a user, I had discovered the wisdom that eluded you all.

On my thankfully infrequent trips to sobriety, I was envied. I had taken the life less ordinary, I was mainlining sun and Britons crave sun. I wore shorts out of necessity and had a collection of sunglasses that I needed, daily. My mode of transport was a Vespa and if I owned a helmet, I couldn't tell you where it was. My diet was the fresh aromatic fare that Jamie Oliver thought was ‘pukka!’.

I later met the woman who became my wife and we decided that we should grow up and shoulder the life of reality. We decamped and moved to England to resume careers and begin a family business that would give us access to the comforts of modern life while still being able to afford an annual ticket to Europe’s theme park of hedonism. This lasted four years. A few short weeks in the summer were not enough and I, not my Greek wife decided to return to a life less pragmatic.

I now ‘own’ a house that is worth a half of what I borrowed to buy it and my euros are worth a fraction of the pounds I brought here. I fear that even this will be a small fortune compared to the Drachmas that may soon line my pockets.

I have taken a number of initiatives to maintain my habit but my Greek, while respectable for a foreigner is still only elementary school level and my children cringe when I use it with them. My options have shrunk but like boiling a frog I resist the discomfort preferring instead to cling to my life in the pages of national geographic on my mountain top home. And every day I hear of another Greek friend or friend’s friend who has gone. Most of my wedding guests are now in Sweden, Germany, the US or London to take my place.

This summer I took my family ‘cold-turkey’ in the UK for a month. We were greeted by rain and a wind that threatened to peel our tans. Cameras hung over every road and there were few to speak to after 10pm. The airfare was cheaper than a bus ride but our funds didn’t go far. The shops were throwing things out the door but after exchanging our diminished Euros we had enough to see a castle or two and restock our wardrobes from a charity shop and boot sales.

With my sun-tinted glasses off, I saw how far we had fallen.

Back home, back in the crack-house, we went to stay a few days at a friend’s summerhouse. We were once more in sympathetic company. After the midday heat we headed to the beach. From the balmy, crystalline sea we watched the sun set over a jagged horizon and I pondered...

sunset on Greek beach
Is this life?
Have I discovered true wisdom or am I just another crack head?


UPDATE 2016: Just got back from a Grand Tour of Europe to find that Greece is now facing a Malaria epidemic, one of the hospitals now refusing to take blood donations is just down the road from us in the area where my kids go to school. Christ! it don't get any easier, does it? 

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Wednesday, 17 June 2015

And the band played on.

and the band played on
Fresh calls for capital controls in Greece have met with frantic activity in the markets. As the game of brinkmanship plays out between the Euro 'institutions' and Alexis Tsipras' SYRIZA government, the only certainty in Greece today is the weather. So much money has left the country's banks over the last few years that they are only being maintained by emergency liquidity assistance, which itself is reliant on compliance to the ECB's terms. The country has already defaulted on one payment to the IMF under the guise of a forgotten clause in the loan agreement. The only question is whether the next will have any disguise or not.
Twitshot

A queue of bleary-eyed commuters wait at the bus stop to make their way to school or work. A car horn vents frustration at a driver taking a slim opening in the traffic.

The Greek economy has been in a shit blizzard for years now. A raft of new, often backdated, taxes and seemingly daily revisions to existing ones has made financial planning almost impossible for all but the biggest enterprises. In an attempt to extract blood from a stone, the government has raised VAT, imposed 'objective' taxes on the self-employed's receipt books and levied new taxes through energy bills.

A group of teenagers chat nervously as they walk into school for their final exams while another hits 'pay' to book his ticket to the UK to study advanced mathematics.

Tsipras has stood firm against the Eurogroup negotiators, refusing to cross the red lines of his mandate from the people to ease austerity. His economists recently presented a new set of proposals in order to release bailout payments, borrowed money that will go straight back to the creditors without touching the Greek economy.

A mother phones round her friends to reschedule her son's birthday garden party after hearing the weather forecast. Another packs her kids up for a day at the beach, now that they are on summer break.

According to Paul Mason, there is an option whereby the situation is put on suspension for nine months during which the IMF/ECB pay themselves, yet another default by another name. This may, however give time to work out a more tenable and long term solution or maybe give Tsipras time to prove his commitment to making reforms. But as GDP shrinks quicker than Levi's on a boil wash, there really isn't much more to tax. Greek HNWI have been squirrelling their assets far away from the greek economy for years now. VSBs and one-man-band enterprises have faced such aggressive taxation in a shrinking market that many just cover costs hoping against hope for things to change.

The owner of a car dealership goes through the week's sale figures. He is focused on improving turnover. He has a sizeable nest-egg in a foreign bank. He calls in his sales team, who do not. 

The high drama being played out in Brussels and the telephone-number sized debts have ceased to have any relevance to the Greek people. They know that nothing will change, the fear of falling has long passed. The colour of the notes in their pockets has lost any bearing on reality. Parents hope for a better future for their kids while their eye darts to this week's deals on the supermarket shelf. Few talk about it anymore, life has no penalty time, each day lost fretting over it will not be added to the end.

A man digs coins from his pocket to pay for his tobacco. Some teachers sit restlessly through a seminar on bullying in a stuffy school hall.

Greek capital will return home, when falling asset prices make Greece the biggest church bazaar in Europe. When land and real estate and any surviving businesses can be bought up and new empires built.

The Greeks are now the refugees with nowhere to go. They are already in Europe, they have no hazardous journey across the Mediterranean and no one to ask for asylum.

...and the band played on.

Sunday, 5 April 2015

Who is the pilot on the GreekWings flight

The flight deck door is locked, autopilot is set, the passengers are frantically banging on the cabin door but can Greece bank before it crashes into the immovable Alps. And, more importantly, will we have to wait for recovery of the black box to discover who was really at the controls.

In these final few hours before impact the Eurogroup is steadfast in its position of total and complete capitulation by the Greek government before it will consider releasing €7.2 billion bailout funds. After reviewing Athens’ proposals for reform, the guardians of the purse strings have deemed them inadequate and even amateurish. So, what are the options for the eurozone if Greece does not satisfy their demands and defaults on the €450 million payment to the IMF on 9th April and who or what is driving those decisions.

The suspects are:


Alexis Tsipras, 40 year-old ‘Radical’ leader of left-wing coalition party, Syriza who has seen a meteoric rise in the last two years but has been in activism and politics since University. His mandate from the Greek electorate is the lifting of Austerity measures imposed by the Troika of creditors and to keep Greece in the single currency.



Jeroen Dijsselbloem, 49 year-old Dutch Labour party finance minister and president of the Eurogroup, the select committee of European finance ministers who since 2015 have jurisdiction over the Euro. His role is to maintain stability of the single currency.



Angela Merkel, 60 year-old German chancellor. She is the leader of the centre-right Christian Democratic Union. Germany’s position in the union makes it the de facto leader in negotiations but she has expressed a desire not to have the Euro fail under her watch.



Jeroen Dijsselbloem
If Greece defaults and a Grexit occurs then in the short term, the bond markets could go bear and the euro would go into free fall. In this age of bond market sycophancy, this is a big deal.

That said, any concessions given to the Greeks would become a precedent for other struggling Eurozone nations and while the band-aid needed to plug the hole in Greece is relatively small, Italy and Spain or even France could be far more damaging.

The austerity strategy appears to be working for some members such as Portugal and Ireland, both have exited the bail-out programme and re-entered the international credit market, the latter is now the fastest growing economy in Europe. However this is just balance-sheet understanding, many Irish and Portuguese are not seeing the benefits.

Many Eurozone nations would be watching Greece to see how it dealt with the divorce and depending on how painless it turned out or what could be learned from the experiment, there could be more departures from the single currency which could well lead to complete devolution.


Alexis Tsipras
In the event of an ill-prepared and messy Grexit the already fatigued Greek people would loose faith in the young prime minister, not only ending his career but sparking chaos and possibly an opening for the far-right fascist groups to seize control. Greeks have hankered for state reform for as long as I can remember but the reality would cause more collateral damage than they are prepared for.

An unnamed Syriza official recently said that as a left-wing government, faced with the choice of defaulting to the creditors or their own people it was a no-brainer. Brave words indeed but also damn straight, given the choice of paying the mortgage and feeding your kids, what would you do. No-brainer, right?

But his choice is not just death or dishonour.


Greece could gain support from Russia. Syriza harbours within its ranks some far left idealists who may still hold romantic notions of allegiance to Russia. They may not have realised that Putin’s Russia has bypassed communism to revert back to the days of the Tsars. 

However, Russia has its own liquidity problems and would not bailout Greece without some pretty heavy caveats whether declared or implied. Recent events in Ukraine are very telling of Putin’s ambitions. Russian gas supplies to Greece which are used for domestic use and electricity generation have already given it a significant political foothold.

Russians also represent a huge growth in tourism for Greece who are also buying up holiday property. In some tourist areas English has been demoted to third place on menus and shop signs.

Angela Merkel
Germany’s motives have much in common with the Eurogroup’s, but Angela must play to the home audience. Germany is running a sizable surplus due to its reluctance to take advantage of cheaper than cash credit which is available to it and the austerity measures it has been imposing on its own people, which it systematically blames on Eurozone slackers like Greece. Bending to Greece would be a domestic disaster for Merkel. While a short-term fall in the Euro could hurt but foreign currency holdings and cheap exports would buffer the blow and she would be seen as a saviour.

The Euro is significantly undervalued compared to the German economy. It is the only economy that could withdraw from the Euro with money in the bank but a return to the Deutsche Mark would mean more expensive German exports and it would go back to being another European nation rather than the epicentre of an EU empire.
If Greece were to be cut loose this would mean a constriction of the European borders especially in a very strategic area of the Mediterranean.

We forget though, there is a new wave of Eurozone candidate nations in the wings including Iceland, Albania, Montenegro and Turkey. Turkey gives access to the Med and the middle east, Albania and Montenegro who give access to the Ionian across from Italy and who along with Serbia and Macedonia go to bridging the northern members to Bulgaria and ultimately Turkey and beyond.

These candidates may be seen as more manageable than Greece and not to mention, a Greek withdrawal would make Macedonia and Turkey’s integration easier.

So who is in the driving seat then? 

Well, Merkel does seem to have the most options.

Tsipras is between a rock and several hard-places. Threats have been thrown of everything from Russia to opening the roads for Islamist extremists but ultimately his hand is bluff. Varoufakis’ and his post-election European road trip found few allies. His only option may be to steer into Russian and Chinese ploughed fields.

Dijsselbloem represents the auto pilot, his role is the result of programming. He can only prepare for the fallout.

And all the while the bond markets are licking their lips with glee, fail or fly the euro will make many hedge funds even more obscenely rich.

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Monday, 30 March 2015

Go Greek for a Week



The Greek tragedy that is being played out like a car-crash reality show that gets recommissioned for a new series every time we think it is coming to the final episode. Like any of you who stuck with ‘LOST’ until the climax, the story just lost any semblance of reason. The Greek narrative is becoming so convoluted and discombobulating that it is difficult to make any sense of it. Are the Greeks the lazy feckless moustache twirlers who siesta’d away over 300 billion Euros or is it the insensitive megalomaniac Germans, hell bent on annexing their neighbours… again. Is Varoufakis an economics rock star Yoda or a naive idealist who still believes he can have his souvlaki and eat it and is Greece’s claim to WWII reparations that could effectively wipe the slate clean valid or simply risible. The fact is that all of this has clouded the real issues. For the simple answer I urge you to look no farther than yourself, your neighbours and your family.


For anyone following the will-they-won’t-they Grexit saga that is being played out in the media, you will notice that the story invariably falls into the language of bond yields and bank solvency. The macroeconomics of the situation are both baffling and contradictory. The Greek government was loaned more money than they could repay under the guise of a stable Eurozone member. Then, woken by the shock waves of the same crash that brought down some of the world’s biggest financial institutions, the markets began to panic causing a world recession which tipped Greece, among others, into a downward spiral. Greece is now locked out of the world finance markets beholden to the TROIKA for its life blood. The money needs to be borrowed in order to pay the loans that have stacked up and not to repay the loans but just the interest. So, more than two thirds of the bailout money is going straight back to the banks. But, it still holds a responsibility to its pensioners, unemployed and the people who earn a living working for the state.

The EU have attached certain conditions to these loans, the so called austerity measures, imagine the credit card company coming into your home and telling you what you can and can not spend your money on, imagine the bank telling you that in order to keep your overdraft facility you will have to sell your delivery van and service your customers with a bicycle then punish you for your business going down the tubes.

Stop!

I’m sorry, it is really difficult to talk about the Greek crisis without getting bogged down in the big picture, because it is so big and there is a reason for that. I did ask you to look to yourself for the answer and I will make good on that.

What did you do to create the property boom? Maybe you bid a little too high on the home you dreamed of, maybe you were a little creative with your mortgage application.

What did you do to cause the decline of the health service, did you worry too much about that lump, did you have an accident in your car, did you get into a fight.

What did you do to cause the downturn in industry that forced companies to move production to Asia, did you need too much to pay you rent/mortgage, did you pull a few sickies, did you spend a bit too much time on facebook.

What did you do to cause the credit crunch, did you fail to resist the sales, did you get tired of your old banger and borrow to get your family around in something cleaner and safer.

You will surely answer yes to many of these questions and more I could ask, so are you deserving of a country that has 25% of its workforce unemployed. A tax system that changes so unpredictably that businesses cannot plan or develop. Or as has recently started, main roads and high streets with the lights out at night because the council can’t pay the bills. No, of course you are not.

In 2011, channel 4 invited audiences to ‘Go Greek for a week’, they laid the blame for Greece's woes quite firmly on the population. This is a message that they intended you to internalise, to make you look to your own culpability in your nation’s flaws. There was some truth in the examples given but it did miss the point. The same point that is missed every time the media bang on about bond market yields and currency markets and GDP. The system manages the country not the other way round, the people took advantage of what was on offer, as you do. Government exists to manage a nation, bond markets exist to help finance these nations and the businesses that rely on the nation’s workforce and infrastructure to make profit. These same businesses and industries rely on the same population to consume their products and services.

The markets, industries, banks and governments exist because of the people, not the other way round. The EU and government’s sycophancy towards narcissistic markets has caused the problem, not you.

The markets are everything that Greece and all the other failing nations are accused of. They are fickle and myopic, they grab all they covet, they do not build civilisations, they do not nurture their own. They liquidate all they touch.

I would, once again, ask you to ‘Go Greek for a week’. Look at what is being allowed to happen to the people you met on holiday and whether you be British, French, German or anyone who feels above their plight to look around and see that you may not be the next Greece but that your time is coming.

The banks are so often described as ‘Too big to fail’ but surely this is a description that should only apply to nations of people.


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Also read: 
Europe needs councelling

I've been living in and writing about Greece for over 15 years This is my ride

Wednesday, 25 March 2015

Investment tip: Go long on Jackboots

The clock is ticking for Greece, a new tranche of bailouts has been agreed on the caveat that Alexis Tsipras’ reforms are up to scratch, not something he managed last time. When the money runs out the banks will implode and Greece will default and fall out of Merkel's merry little club and start printing drachma, right? Wrong. My investment tip is go long on jackboots because there are groups in the sidelines rubbing their hands together for a chance to begin their own ‘Project Mayhem’. A wave is coming and it smells of smoke.


Greece's new government will be successful just so long as it can maintain some stability. At the moment, the people are behind them in sufficient numbers, 47% according to a recent Metro analysis poll (but since when have polls been bankable), because they are trying to stand their ground against the austerity measures that have brought the country economically and socially to its knees. But if Varoufakis’ game theory ultimately turns out to be Candy Crush vs Eurogroup’s World of Warcraft, things will change and fast.

The country’s neo-nazi group, Golden Dawn has had its head a little low of late. Its leaders have been in prison and it has fallen back a little in the polls but that does not mean their support has waned. The thing with single policy groups is that they always attract floaters who will align with whoever satisfies that need at that time. The need at the moment is HOPE and Syriza is selling it by the bushel. But, If their ring turns brass, as is inevitably will, the need will be ANGER and for that the far-right is one-stop shopping.

In Germany, the war of words between the Greeks and the Germans has stoked the fires of xenophobia. The German government has been running a surplus which has called for a its own brand of austerity. Wages have not been keeping up with inflation and many are feeling the pinch. The obvious cause of this turn of fortunes is the lazy Mediterraneans and the French who have not been pulling their weight. Many Germans are tired of bailing out the rest of Europe and neo-nazi groups have gained ground.

Nigel Farage’s Ukip seem to be talking to the people despite the derision in the media, they are saying something the people need to hear. The ‘squeeze on the middle’ has made the middle-classes less affluent in real terms and house prices are taking a huge chunk from their incomes. At the lower end, eastern Europeans are believed to be taking unskilled and semi-skilled positions driving wages down to a point where the minimum wage is a standard not a safety net.

In France, Marine Le Pen’s Front National took 25% of the votes in the recent local elections. This is largely due to the Charlie Hebdo and related attacks as well as the struggling economy. The people are looking for action not words, they don’t feel safe and could easily fall into getting more protection than they bargained for.

The right-wing Sweden Democrats have been maintaining a steady presence and are now the third party with 13% of the vote.

So why the comment at the beginning of this article about ‘going long’ on jackboots.

It seems that the current obsession with finance and economics, the bond markets, going long, going short, currency markets and yields has detracted for the reason for their existence. Adam Smith, the grandfather of capitalism in his 1776 seminal work “The Wealth of Nations” focuses on the people, population’s role in wealth and prosperity. Marx built his thesis around the needs of the people vs the aims of industry, JM Keynes with JF Roosevelt built a ‘New Deal’ that focused on putting liquidity into the market (shops and industry) through the workers’ pockets and even Milton Friedman recognised the fundamental role of the population.

‘The markets’ have become narcissistic in their Hubris, a self-serving Matrix with the right to all and responsibility to none. But, worse of all, we and especially the world’s leaders are buying into it. The Banks must be firewalled at all cost and market value is the only value. Our young entrepreneurs are told to seek out venture capitalists, Dragons den and Shark tanks. Work, build and form an exit strategy. Investment is the only real goal. The markets are betting on the Eurozone’s demise and in the bond markets they are trading sovereignty futures.The system is no longer serving anyone but the system.

And, while the world is looking the wrong way, certain groups are flourishing in the peripheral vision. Building networks, brewing hate and offering solutions.

It is often said that Europe sleepwalked into WWI but we couldn’t make that mistake again, after all, we all learned from the past mistakes, didn’t we. Could it be said in the future that we were not asleep just blindsided by the markets and the pursuit of a unified European trading platform.


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Friday, 20 March 2015

What will Greece do after the GREXIT

Last night Alexis Tsipras entered talks with Angela Merkel, Francois Hollande and select members of the Eurogroup for yet more discussion on what is essentially how to do what fewer and fewer people want and what more and more fear; keeping Greece in the Eurozone. The result wasn't much different to the previous summits; we'll wire the money if you play ball. Tsipras has not played ball and it seems just a matter of time before one side or the other calls time on this game of ping pong. So what will Greece do after this push/jump scenario plays its logical conclusion.
Eurozone tug o' war
Game Theory: Candy Crush vs World of Warcraft
In a recent interview with Costas Lapavistsa, Economist at London's SOAS and Syriza MP he said they were 'Flogging a dead horse'  he added that Syrizas' strategy had come to an end and it was time to negotiate an amicable departure from the Eurozone. Indeed, after a huge show of strength by Tsipras and Varoufakis it seems that Yanis' famous game theory has been but Candy Crush to the Eurogroup's World of Warcraft. The question on everyone's lips now is what will the bankrupt nation do after default or a negotiated withdrawal from the single currency system. The one would leave Greece with cleared debt but no line of credit with international financiers, the other with a huge debt hanging but maybe some line of credit. Recent example of these scenarios being played out are Argentina and Iceland, two quite different cultures that resulted in very different outcomes. 
Yanis Varoufakis, Greek finmin and self proclaimed Erratic Marxist subscribes to the theory of growth through massive public investment, the Keynesian approach to economic development. This is the same strategy that brought the US's New Deal which many believe brought the country out of the Great Depression in the 1930s under Roosevelt. But this was a programme implemented by a country with huge resources in a time very different from now, when people's expectations from the state were almost non-existent. We now live in a world of state benefits, healthcare and education, undeniably progress but also costly. Varoufakis believed that this strategy could be successful from within the Eurozone but it is obvious that this is not compatible with the Eurozone's strategy. In fact, Germany has been tightening its purse strings with its own people. Their idea of a New Deal is Quantitative Easing (QE), pumping money into the top and preying that it will reach somebody grateful. The Keynesian approach is to pump money into projects that put money in the public's pocket so they will share it with each other and industry.  
The common misconception with Keynesian capitalism is that it is a spendfest. The Greek government is historically bad at making free with capital. Tsipras has already committed to re-bloating the public sector and while this may put a few more Euros (or Drachma) on the high street it will do little to stimulate industry or entrepreneurial activity. On the contrary, a more populous public sector tends to increase bureaucracy to keep the bodies busy. This has traditionally been Greece's major obstacle for foreign investors as well as local entrepreneurs. 
So, where could the money, if there were any, be spent to get the country's economy moving.
AGRICULTURE: Investment in farming could boost the economy, there are few places as fertile and the quality of its produce is world-class. But, the industry will need to change fundamental attitudes. This has already begun but years of unrealistic state compensations have made it more viable for many producers to be less competitive. A turnaround in approach with higher productivity could well save the country’s ailing fortunes. Farming has traditionally been viewed as peasantry but food technology is a growing and the world needs food, not just from mass consumption but also premium quality, something that Greece could do very well at.
RENEWABLE ENERGY: Greece has more than twice the sun-hours per year than the UK. While there has been huge investment in solar farms in recent years, changes in policy and the national electricity company reneging on contracts has made this area much less attractive. Farming and domestic waste could also be a good source of fuel for anaerobic digestion plants that may not be an export but they would take the pressure off imports of oil and gas from Russia.
MINERAL RESERVES: Greece has untapped reserves of gold, rare-earth metals while speculation of oil and gas reserves have yet to be fully explored. The exploitation of these may be another way forward but this must be approached cautiously as there is a lot of resistance from groups that maintain that the ecological impact could damage tourism, Greece’s major income. It must also be ensured that profits find their way into the Greek coffers and not Swiss banks.
NEW TECHNOLOGY: Greece has one of the highest levels university graduates in Europe and a thriving entrepreneurial community but the lack of jobs and funding has caused a huge haemorrhage of graduates and young entrepreneurs abroad. Their startups ultimately contributing to the GDP of other countries, their skills acquired and paid for by Greece, working for foreign interests. This trend needs to be reversed with support, funding and stripped-down bureaucracy for new ventures. 

And don't forget: Greece is a fabulous winter destination with history, clement climate and even skiing. Visit this site for ideas 
It is painfully obvious that the Euro has failed on so many levels but mostly it has failed the people it was supposed to serve, the European citizens. Instead of unifying a continent it has bred mistrust and acrimony. 
The Greek exit will be traumatic, as will be the exit of other members. But, it is good management that will make the difference. Iceland made a quick turnaround but Argentina continues to suffer and I fear that Greece has more in common with the latter.
I believe that the Keynesian approach is the way forward, Hayak/Friedman's free market neo-liberalism has already devastated many nations at a social level (let's forget the markets for one moment). Good management is the key, funding needs to find its way to stimulation of GDP not the deficit.


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Monday, 23 February 2015

Is Greece ready for the New Drachma

On Friday 20th February Tsipras, Varoufakis and the Greek people found themselves between a rock and a hard-place. The rock was supplied by Wolfgang Schäuble who has been quite gloating in his intentions to break the Greek delegation and continue with EU's strategy for the Eurozone. The hard place was supplied by the Greeks themselves as the announcement on Greek media that around €20 billion had hemorrhaged from Greek bank deposits since December and the scene was set for a full-on run on the banks. Of course, telling people that their deposits may not be safe can have but one result; their deposits will not be safe. An insolvent banking system would be politically disastrous for the most popular government since ousting the junta in 1974. Finally Tsipras ad Varoufakis had no choice but to capitulate and return home with their tails between their legs.

           

Tsipras has vowed that if he doesn't get a fair deal he will leave slamming the door so hard that the whole house will fall in. Has that time come. The win that has be lauded, in lieu of anything else to say is that the Eurogroup has agreed to see a list of proposals for exactly how they intend to bring the economy into check, this is seen as a positive but we must also consider that while the knot has been loosened, it is also possible to wriggle the noose tighter still. There is no way that the Eurogroup (Schäuble) will be satisfied with the proposals this whole exercise is a last ditch demoralisation tactic, maybe even to force Tsipra’s to play his hand. The backlash has begun with the most audible coming from within Syriza’s own ranks, Manolis Glezos has accused Tsipras of trying to get away with calling meat fish with reference to the lexical realignment of the Eurogroup agreement.

Are the Greeks finally ready to bite the bullet and embrace the Drachma again.

There have been no reliable domestic polls on a Grexit and return to the Drachma and none could possibly done as merely putting the question to the people would cause the mother of all runs and a collapse of the economy before anything could be done. I have been trying to gauge public opinion here on the subject and the first impression took me by surprise, people are reluctant to talk about it. This is strange for a people who have always had a preoccupation with politics, taken relish in criticising the government and more recently the governments of its European partners but now starting the conversation provokes nervous fiddling with smart-phones, shoulder-shrugging or irritated changes of subject. So tired by hope against hope, so weary of broken plans, many have shut down completely. Their last burst of excitement spent, they are resigned to a new status quo and are trying to get on with breathing again. The world outside the political rallies and euro zone negotiations is calm detachment. According to Robertson and Bowlby’s attachment theory Greece has come to the third stage of ambivalent attachment, a survival stage that avoids any further emotional investment and the pain that accompanies disappointment.

Is Greece ready to embrace a new drachma. According to Bowlby, Robertson and even Naomi Klein’s Shock Doctrine, Greece is neither ready nor resistance to anything any more and those who feel powerless will just get on with breathing regardless of the flavour of air they are given. 

The one thing I have realised is that for the first time the Greeks have leaders to rally behind and that could just make the difference. 


UPDATE: WHAT WILL GREECE DO AFTER THE GREXIT


Thursday, 19 February 2015

Europe needs counselling


Forget game theory, what is going on in Brussels is an acrimonious divorce with Germany playing the stoical male role while Greece is the emotional wife trying to get the best for her kids. The passion has gone and it is a relationship that has been reduced to mere financial dependence, a situation that will be familiar with many frustrated spouses. The eurozone is a dysfunctional family that is in desperate need of reconciliation counselling if it is not to pull itself apart causing generations of bitterness and trauma.


If this divorce goes through, the Fatherland will keep the house and cars.
Twitshot


She just won't listen!
We, especially in northern Europe are are conditioned to rely on the head to make important decisions, logic is good. The financial institutions are playing this role, crunching numbers and coming up with plausible reasons why Greece is being histrionic and unreasonable to expect concessions that might allow the family to flourish as a stable and contented union. Wifey just doesn’t understand the pressure that he is having at work and needs to get on with keeping a thrifty home. But Dad’s work has become an obsession with him and while it was originally intended to be a good source of income to feed and clothe his family, it is now beginning to take the place of the family. He has become so defined by this role that it has blurred all perception of purpose. The Euro is a medium of exchange, a facilitator existing only to service the family unit and yet as it fails to satisfy this purpose it is the family who are made to adapt, it has become the only thing of importance.

In 2011, I had he pleasure to meet the now Belgian finance minister, Johan Van Overtveldt. In his 2011 book The end of the Euro, he points out that the single currency was doomed from the outset as an economic union was foisted on a group of nations that had not established a political union on which to base it. Like a marriage of convenience where the couple had not had adequate time to establish a sound understanding and mutual admiration before deciding that his job prospects were sufficient to base a life long bond. So arrogant have the world’s bankers become that they really feel that money makes the world go round. They expected the common currency to be the leverage in European political unification under the logical auspices of the German banking system. This, as Overveldt predicted is blowing up in their faces now and Greece is being offered up as the unstable mother, unfit to care for her children.

The Fatherland is presenting a face of maturity that casts aside the humanistic aspect of government as folly and whimsy. Their focus is on balance sheets and policy that has been (badly) designed to support a currency system that will eventually condition the population of Europe to serve it. This is an autistic mindset that cannot contemplate the uncountable. We are being expected to side with the validity of this argument as it is irrefutable with logic.

The mother of democracy is harping on about how badly she has been treated and that she cannot support her children. She is not getting the right kind of support from her partner. Yes, he gives her money for the home but it’s how he gives it, the demands he makes on her, the disapproving frowns when she tries to make herself nice, the silence at the dinner table when she serves something a little simpler because she has evening classes. She has a point but her argument can get a little confused with ideas that are less easy to quantify as they are off-balance sheet considerations.

We sympathise with Mum but Dad makes more sense because he is logical.


What is needed is a mediator who can reconcile this difference of language. Yanis Varoufakis is arguing socio-political aspect of the relationship, a strategy for growth while the Eurogroup president Jeroen Dijsselbloem insists on strict adherence to the austerity programme, a financial paring intended to support the medium of exchange at all costs.

Relationships of all kinds are dependent on understanding and evolution. I spoke to psychiatrist, Dr. Alexios Lappas, he said that successful relationships are based on similarities and differences, the prior form the core of shared goals while the differences maintain interest. However, as the responsibilities and strains of routine bite, the interest begins to wane and they regress into survival mode. The differences begin to be viewed as betrayal, by the anxious survival mode mind and they look for endorsement from friends (common ground relationships) who will tend to agree with their friend and support an exit from the relationship. It will not be long before irrevocable differences are cited and the family will split into those on dad’s side and those who support mum.



It is too late to impose a retro-fit political framework to underpin the eurozone’s fiscal policies but if the relationship is to develop through the present crisis it will need to be forward facing. The present negotiations in Brussels is an opportunity for growth but in order for that to happen Dad is going to have to loosen his tie and open himself up to some uncomfortable new feelings.  

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From Under Dark Clouds

The Century of DIY