Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Eurointelligence Daily Briefing: Better than expected - but reduction in net present value of Greek debt
is only 21%
The European Council agreed on a package for Greece and changed the rules of the EFSF; initial market reaction was euphoric as Spanish and Italian yields came down; agreement includes a new Greek EFSF/EU programme of €109bn; the private sector will contribute €50bn until mid-2014, and €106bn until 2019; participation scheme will attract a temporary SD rating; package includes funds for bank recapitalisation and collateral enhancements to allow Greek banks to borrow from ECB; EFSF loans' maturities will be lengthened to 15-30 years, and interest rates cut to 3.5%; this also applies to Ireland and Portugal; EFSF can act pre-emptively, and will get flexible credit lines, right to buy bonds in secondary markets, and to recapitalise banks; details of PSI to be worked out with IIF; European Council also agreed on what it called a Marshall Plan for Greece, with more EU investments flowing into the region; Nicolas Sarkozy calls it the beginning of a European Monetary Fund; FT calls it a political victory for Angela Merkel; Hans Werner Sinn says agreement amounts to economic blackmail against Germany; other German economists are more balanced in their assessment; FT Deutschland gave a cautious endorsement of the agreement; Les Echos celebrates Nicolas Sarkozy as the eurozone's crisis manager; Dominique Seux writes the EU will need many more such agreements to overcome the crisis; Jean Quatremer called last night's summit a beautiful success that proved the eurosceptics wrong; the Irish Independent welcomes the €800m a year reduction in Irish interest payments; the FT's Lex column says the market reaction is too extreme; Nouriel Roubini says the reduction in net present value is not sufficient; Paul Krugman focuses on the EU's wish for everybody to save at the same time, to be competitive against each other; Bild, meanwhile, is jubilant about the fact that Greece is now bankrupt.
(Google link)

Economics is politics by other means
by Carrie (migeru at eurotrib dot com) on Fri Jul 22nd, 2011 at 08:01:01 AM EST

Others have rated this comment as follows:


Occasional Series