"There is a little pause in these discussions. But I am confident that they will continue and we will reach an agreement that is mutually acceptable in time," Papademos said according to a transcript of an interview with CNBC.
via Greek PM confident debt swap to be clinched in time | Reuters.
Private Bond holders i.e. hedge funds are never going to take any haircut on their bonds, the reasons outlined here.
Greek default is now inevitable there is absolutely nothing that can be done except for wasting a monumental amount of tax payers money delaying default for another 6 months, and thus multiplying the pain.
The repeated application of a bad idea, does not ever result in the required outcome.
Angela Merkel
“I myself never saw a Triple-A fund as that important”
via The Slog.
Just incase you where in any doubt how monumentally blind and stupid Angela Merkel appears to be, below is a short excerpt of S&Ps' reasoning for the downgrading of EU countries. Taking particular attention to note the lack of any kind of confidence in the EU to get anything done.
S&P:
More fundamentally, we believe that the proposed measures do not directly address the core underlying factors that have contributed to the market stress. It is our view that the currently experienced financial stress does not in the first instance result from fiscal mismanagement. This to us is supported by the examples of Spain and Ireland, which ran an average fiscal deficit of 0.4% of GDP and a surplus of 1.6% of GDP, respectively, during the period 1999-2007 (versus a deficit of 2.3% of GDP in the case of Germany), while reducing significantly their public debt ratio during that period. The policies and rules agreed at the summit would not have indicated that the boom-time developments in those countries contained the seeds of the current market turmoil.
Standard & Poors
Bond Holders walk away from Greece Bond Haircut:
This week also hailed the final nail in the coffin for the Greek haircut idea, with the IIF walking away from talks to "pause for reflection" link Interesting to note that media reported this as a done deal back in November.
It was never going to happen, why would the major bond holders voluntarily take cuts on their holdings. Bare in mind that the vast majority of holders of Greek debt now appear to be Hedge Funds.
These Hedge Fund being neither stupid nor suicidal knew that the EU was unlikely to force any cut, and were more likely to pay them out. Secondly, you really think they didn't by insurance just incase? So why would you take a cut, when both options available to you are up.
Bloomberg: US Banks heavily exposed to CDS on EU Debt.
In the pre-austerity Athens budgets, there were quite a few items on the military’s shopping list… 60 Eurofighter aircraft, €4 billion. French frigates and patrol boats for over €4 billion and €400 million respectively. German U-boats, for €2 billion. But – you’d think – all that’s had to go by the board.
via GREEK CRISIS: AND YET MORE FRANCO-GERMAN HYPOCRISY | The Slog.
Franco-German hypocrisy of the highest order, it really doesn't take a genius to work out the EU and for that matter the whole banking axis, is rotten and corrupt to its very core.
Lets not forget the French and German Pension liabilities that need paying.
French pension liabilities 303.81% of GDP, German pension liabilities 281% of GDP vs UKs 90.92%. French + German liabilities total nearly half of all pension liabilities across the 19 EU states.
And the Euro is going to stick around for the rest of the year, I think not. Its debt on-top of debt on-top of debt - it might as well be swiss cheese. Infact futures in cheeseare probably a safer bet than Euro futures.
From the horses mouth.
‘By contrast, State-funded pension obligations in France and Germany are three times the gdp of those two countries. Together they total 13.9 trillion euros, VERY NEARLY HALF of the pension bills of the 19 nation States studied by Freiburg’s authors, Christoph Mueller, Bernd Raffelhueschen and Olaf Weddige. - http://www.vwl.uni-freiburg.de/fakultaet/fiwiI/publikationen/229.pdf
