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.

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