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Easy to be wise after the markets open, but it seems the doomsayers are at least premature.

The euro hasn't tanked, markets are down a bit but haven't crashed, and the creditors are busy preparing a new offer for today lunchtime...

They are all falling over themselves to assure everyone that they would already have been talking debt reduction over the weekend, if the Greeks hadn't slammed the door. Perfidious bastards.

So I'm aligned with Jake's thesis that this is a pre-planned and masterful ploy by the Greeks, rubbing the troika's nose in its own collective stupidity, which will garner major concessions on debt restructuring at very little cost.

So how does it play out?

  1. Creditors table a new offer today
  2. Tsipras says, very interesting, let's keep talking
  3. By about Thursday, a feasible proposal is on the table
  4. Tsipras says, we can now recommend a Yes vote in the referendum
  5. No doubt about the result
  6. Banks and stock market open normally next monday


It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Mon Jun 29th, 2015 at 04:55:49 AM EST
There is a game-theoretic bent to this referendum action. In the game of chicken, Syriza is throwing the wheel out at about the last moment. Now up to troika to choose its best option.

At worst, the referendum allows the Syriza government to survive a "de facto" default for a few days. A horse might speak then.

by das monde on Mon Jun 29th, 2015 at 05:36:35 AM EST
[ Parent ]
Normally, people playing chicken think that the important point is knowing when to turn, but there is an even more important, and fundamental, point: having an opponent who is aware there is a wheel to turn.  The Eurogroup isn't aware which direction the sun rises, and though the troika knows there is a wheel, it considers itself indestructible and sees no need to turn it.
by rifek on Mon Jun 29th, 2015 at 11:53:49 PM EST
[ Parent ]
I hope you are right, but when considering how the creditors will play this game, there is also the angle of getting approval in national parliaments, and the factor of stupidity.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Mon Jun 29th, 2015 at 05:40:43 AM EST
[ Parent ]
This is a key factor "anti-Syriza" people keep missing when they express horror at the referendum.

The Eurogroup has always reserved final agreement for certain national parliaments... because "democracy..."

by Metatone (metatone [a|t] gmail (dot) com) on Mon Jun 29th, 2015 at 06:03:03 AM EST
[ Parent ]
Except when there are bonds involved. Then it's "fuck democracy."
by ThatBritGuy (thatbritguy (at) googlemail.com) on Tue Jun 30th, 2015 at 10:02:43 AM EST
[ Parent ]
Can we really look at the euro as a measure of the underlying panic? Sees to me that in the event of the euro unravelling totally over the next few years, anyone who is levered with euros in German banks runs the "risk" of having their euros converted to DM, which wouldn't be such a bad thing. In other words, it's the weaker country bondholders who should be worried. In the core, there is probably no panic.
by Upstate NY on Mon Jun 29th, 2015 at 11:49:22 AM EST
[ Parent ]
It's looking to me like things are in fact getting worse and Greece will be in full financial meltdown by Thursday.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Jun 30th, 2015 at 12:27:16 AM EST
[ Parent ]
The terrible thing is that it may make them vote the wrong way. Wrong as in against their own good.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi
by Cyrille (cyrillev domain yahoo.fr) on Tue Jun 30th, 2015 at 04:23:28 AM EST
[ Parent ]
The bank holiday might prevent (delay?) this meltdown as I wrote in this post. But the forcing the "meltdown" is certainly part of the strategy of the Eurogroup. There is no alternative.

You might find me At The Edge Of Time.
by Luis de Sousa (luis[dot]a[dot]de[dot]sousa[at]gmail[dot]com) on Wed Jul 1st, 2015 at 04:07:23 AM EST
[ Parent ]

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