Greece and EU: Roosters Roost?

[Kathianne]

This seems to sum it up:

http://finance.yahoo.com/news/greece-hold-election-jolts-euro-144543745.html


By Dina Kyriakidou and Paul Taylor



ATHENS/PARIS (Reuters) - Attempts to form a government in Greece collapsed on Tuesday, jolting financial markets at the prospect that leftists opposed to the terms of an EU bailout could sweep to victory in a June election and tip the euro zone deeper into crisis.


The turmoil in Athens sent shock waves around other troubled members of the 17-nation European single currency area. The euro slipped below $1.28, world stocks slid and Spanish and Italian bond yields rose above the danger level of 6 percent as investors scurried for shelter in safe haven German Bunds.


The tremors from Greece, compounding worries about Spain's debt-laden banking system, ended any honeymoon for new French President Francois Hollande, thrusting the growing risks to the euro zone to the top of the agenda for his first meeting with German Chancellor Angela Merkel hours after he took office.


In his inaugural address, the Socialist president called for a European pact to revive growth and temper German-driven austerity measures, seeking to change the direction of euro zone economic policy.


"I will propose to our partners a pact that will tie the necessary reduction of our public debt to the indispensable stimulation of our economies," Hollande declared, saying Europe needed "projects, solidarity and growth".


The French leader's aircraft was struck by lightning shortly after takeoff from a military airport near Paris en route for Berlin, forcing him to turn back and take a substitute plane.


In Athens, President Karolos Papoulias abandoned efforts to broker a compromise on a cabinet of technocrats to steer the country away from bankruptcy, nine days after an inconclusive general election. A caretaker government will now be formed pending a new vote probably in mid-June...

[Kathianne]

Indeed:

http://www.zerohedge.com/news/has-greek-bank-run-started


Has The Greek Bank Run Started? http://www.zerohedge.com/sites/default/files/pictures/picture-5.jpg (http://www.zerohedge.com/users/tyler-durden)
Submitted by Tyler Durden (http://www.zerohedge.com/users/tyler-durden) on 05/15/2012 11:36 -0400


While the long-term decline in bank deposits over the past 3 years has been well documented both on Zero Hedge (http://www.zerohedge.com/news/greek-bank-deposit-outflows-soar-january-third-largest-ever)and elsewhere, it is the most recent, acute post-election phase that has not gotten much coverage. Minutes ago Bloomberg sent out a notice that things in Greece may be on the verge of the final collapse. From Bloomberg: "Anxious Greeks have withdrawn as much as 700 million euros ($893 million) from the nation’s banks since the inconclusive May 6 election, President Karolos Papoulias told party leaders yesterday, according to a transcript of the meeting posted on the presidency’s website today. Papoulias said he got the information from the head of the Bank of Greece, the central bank, George Provopoulos, according to the transcript." While this was likely a negotiation talking point to facilitate the formation of the government, the reality as we now know is that there has been NO government formed, which now means that the bank run will only get worse. Needless to say, a Greek banking system which is now virtually shut out of any extrenal funding except for the ELA, where it has a few billions euros in access left, will be unable to deal with hundreds of millions in deposit outflows.
This may be the beginning of the end for Greece, just as Buiter (http://www.zerohedge.com/news/if-greece-exits-here-what-happens)and later JPM (http://www.zerohedge.com/news/jpmorgan-estimates-immediate-losses-greek-exit-could-reach-400-billion)warned over the weekend.
And courtesy of Russian_market, here is a picture of the first Greek ATM lines (https://twitter.com/#%21/russian_market/status/202423754599567361/photo/1):
http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2012/05/greek%20ATM%20lines.png

[fj1200]

Just how many times have the powers-that-be been praised for a plan to end the crisis? Just another signal to the folly of technocratic socialism.

[Kathianne]

Just how many times have the powers-that-be been praised for a plan to end the crisis? Just another signal to the folly of technocratic socialism.

Doing the same dumb thing, over and over, getting the same result:

http://money.cnn.com/2012/05/16/markets/stocks/index.htm


Greece worries weigh on U.S. stocksBy Hibah Yousuf @CNNMoneyInvest (https://twitter.com/intent/user?screen_name=cnnmoneyinvest) May 16, 2012: 4:51 PM ET http://i2.cdn.turner.com/money/2012/05/16/markets/stocks/chart_ws_index_dow_2012516162213.top.png (http://money.cnn.com/data/us_markets/?iid=EL)Click the chart for more stock market data.

NEW YORK (CNN Money) -- Following a positive start, U.S. stocks closed in the red for a fourth straight session Wednesday, as investors weighed strong U.S. economic data against ongoing uncertainty about Greece's political situation.

[fj1200]

Doing the same dumb thing, over and over, getting the same result:

Yeah, I had to check the date of your story because it could have been posted about 7 or 8 times in the past few years.

[Kathianne]

Yeah, I had to check the date of your story because it could have been posted about 7 or 8 times in the past few years.

Really depressing. Glad I'm not German. Though it will come home to roost and bite us all in the butt, the only question is when and how big the beak will be.

[avatar4321]

Really depressing. Glad I'm not German. Though it will come home to roost and bite us all in the butt, the only question is when and how big the beak will be.

Im really glad im not the rest of Europe when the Germans realize they are screwing with them.