Monday, 29 June 2015

Greeks run out of road

There they were, happily kicking the can down the road, the EU and the Greeks, dickering about how how to square the German work ethic with the Greek desire to snooze in the sun, all sides content that the talking could just meander on forever when Greek PM Alexis Tsipras had to go and ruin it by kicking the can against a wall.

Specifically, he called a referendum on the deal. On Sunday this week (5/July/15) the Greeks will vote and that is that; no more talks, the deal is done or not, but the show is over either way. Big mistake! Should have just kept talking. Seriously, the EU was providing a billion a week in "emergency liquidity assistance" (ELA) - why would you put the kibosh on that? And the more cash the EU provides, the deeper in the hole they are, the weaker their position at the negotiating table becomes.

Anyway, he did it. He pressed the big red button and all that remains is for the Greeks to vote Ney or Ochi. Ney means "yes" by the way, and Ochi means "No". The Greek word for yes sounds like no in every other European language. There's a lesson there, but blowed if I know what it is.

Another quirk of the Greek language (rendering in the Latin alphabet) is: kalimera means good morning, kalispera means good evening and kalinichta means good night. There's an obvious omission in that list. What happened to good afternoon? Ha! The Greeks don't have a word for good afternoon - the need has never come up.

Once Tsipras had drawn his line in the sand the EU decided the Greeks needed a nudge towards Ney, ie yes. How better to concentrate their minds than to put them on short rations for the week. So they stopped the ELA money pipe and now the banks are closed and Greeks can only withdraw €60 per day. The banks will stay closed all week and the hunger pangs should help the Greeks decide where to put their cross.

The government also closed the stockmarket for the week; not that much trading could be done with the banks offline.

Probably though, the Greeks are not going to suffer enough during the coming week to vote Ney. They have had several years to get their money out of the banks and have become quite used to removing their wages or pension as soon as it turns up. And with the banks closed they have the perfect excuse not pay any of their bills, so it's not all bad.

More likely they will vote Ochi and tell the EU to get stuffed. That would be bad news for the Germans, currently €60bn in the hole and the Italians, €40bn in the hole. So what will happen after the Greeks have voted no is that the Greek government will be invited back to the negotiating table for more talks!

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