International Financial Law Prof Blog

Editor: William Byrnes
Texas A&M University
School of Law

Tuesday, February 17, 2015

Europe Calls Greece's Bluff, No More Euros Without Greece Spending Reforms

Reuters reported - "The unexpectedly rapid collapse raised doubts about Greece's future in the single currency area after a new leftist-led government vowed to scrap the 240 billion euro ($272.4 billion) bailout, reverse austerity policies and end cooperation with EU/IMF inspectors." ...

"Dutch Finance Minister Jeroen Dijsselbloem, who chaired the meeting, said Athens had until Friday to request an extension, otherwise the bailout would expire at the end of the month. The Greek state and its banks would then face a looming cash crunch." ...

"German Finance Minister Wolfgang Schaeuble said before the talks that Greece had lived beyond its means for a long time and there was no appetite in Europe for giving it any more money without guarantees it was getting its finances in order." ...

"It is a very negative development for the economy and the banks. The outflows will continue. We are losing 400-500 million (euros) every day and that means about 2 billion every week. We will have pressure on stocks and bond yields tomorrow," he said. read Reuters here

NY Times reported "The urgency of Greece’s financial situation was underscored on Monday by a report from JPMorgan Chase indicating the Greek banks were losing deposits at the rate of 2 billion euros, or $2.27 billion, a week. If that pace continued for the next 14 weeks, the banks would not have enough reserves on hand to issue new loans, according to the report."

| Permalink


Post a comment