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Posts Tagged ‘WSJ’

IMF Raises Referendum Stakes With Call for More Aid for Greece and Debt Relief

Posted by hkarner - 4. Juli 2015

Date: 03-07-2015
Source: The Wall Street Journal

Prime Minister Alexis Tsipras seeks to sway Greeks who fear a ‘no’ vote
Greece’s referendum on creditors’ demands could decide the country’s future, as top European officials warn that Greece doesn’t belong in the eurozone if it isn’t willing to take up reforms. What does Sunday’s vote mean for the Euro?

The International Monetary Fund warned that Greece would need comprehensive debt relief and more than €60 billion ($66.6 billion) in new aid to return to financial health, raising the stakes in an already fraught Greek referendum over creditors’ bailout terms.

The IMF’s comments, released Thursday in a detailed review of the country’s debt, come days before the Sunday referendum, which is likely to shape the nation’s future in the eurozone.

The fund’s message: Greece’s economic situation has considerably worsened thanks to the escalating conflict with its creditors, and any new rescue deal that involves the IMF would require greater financial generosity from Europe than eurozone leaders have been willing to countenance so far. Den Rest des Beitrags lesen »

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German Public Stands Behind Angela Merkel’s Tough Stance on Greece

Posted by hkarner - 2. Juli 2015

Date: 01-07-2015
Source: The Wall Street Journal

Referendum called by Greek Prime Minister Alexis Tsipras meets hardened public opinion in Germany
 Chancellor Angela Merkel has maintained her stance that Greece must implement unpopular reforms to secure a bailout extension.

BERLIN—If Greek Premier Alexis Tsipras had hoped his referendum announcement would scare his German counterpart into offering his country much looser bailout terms, a quick look at recent German opinion polls might have changed his calculus.

Surveys gathered before and after the breakup of negotiations between Athens and its creditors show Germans stand firmly behind German Chancellor Angela Merkel’s message, delivered at a news conference here on Monday, that if Greece is going to remain in the eurozone, it will have to implement the unpopular economic overhauls Athens is rejecting.

Government officials say that despite Ms. Merkel’s concerns that a Greek exit would split Europe at a time of challenges ranging from Russian aggression in Ukraine to Jihadi terrorism and a refugee crisis, yielding now would undermine the rules that underpin the eurozone. Den Rest des Beitrags lesen »

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Greece’s European Identity Is at Stake

Posted by hkarner - 29. Juni 2015

Date: 29-06-2015
Source: The Wall Street Journal By SIMON NIXON

Greek history is filled with major disasters and impressive recoveries

The history of Greece is filled with major disasters and impressive recoveries. Even its birth in 1832 was a triumph over the odds, assisted by the decision of the U.K. and France to come to the rescue of an independence movement on the brink of defeat. Greece then spent half the years until 2006 in default, having had to restructure its debts six times.

Yet despite its many setbacks and notwithstanding its present predicament, it is arguably the most successful state to emerge out of the ashes of the Ottoman Empire and has proved a beacon of prosperity and stability compared with the rest of the Balkans.

This success partly reflects the unique hold Greece has on the European imagination, which secured it vital support at critical moments in its history. For the rest of Europe, Greece is more than a country: it represents an idea, a reflection of the common roots of a shared civilization, a beacon of liberty, a symbol of resistance. Den Rest des Beitrags lesen »

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Greek Suicide Watch

Posted by hkarner - 29. Juni 2015

Date: 29-06-2015
Source: The Wall Street Journal

Athens has itself to blame if it defaults and leaves the euro.

The collapse on the weekend of last-ditch talks to extend Greece’s bailout means Athens won’t be able to afford a €1.55 billion debt payment due to the International Monetary Fund on Tuesday, the day the 2012 bailout agreement expires. The European Central Bank said Sunday it won’t increase its liquidity assistance to Greek banks, and Greece ordered banks not to open Monday to avoid more deposit flight.

None of this automatically triggers a euro exit. But it’s hard to see how Greece could stay in the currency bloc for long if it defaults on its debt, refuses to implement fiscal and economic reforms and, in all likelihood, imposes capital controls.

This marks a long fall in the five months since Alexis Tsipras and his far-left Syriza Party were elected on a platform of rolling back reform. Ahead of January’s parliamentary vote, the economy had started growing again after four years of recession and a contraction of around 25%. Athens in 2014 sold bonds to private investors for the first time since 2010 and was on the verge of exiting its 2012 program. Den Rest des Beitrags lesen »

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Bad Greek Deal Better Than No Deal

Posted by hkarner - 25. Juni 2015

Date: 25-06-2015
Source: The Wall Street Journal By SIMON NIXON

Any Greek deal will be bad compared with what was on the table five months ago

Alexis Tsipras’s five-month campaign of brinkmanship with Greece’s creditors was always going to end in one of two ways: either with the prime minister’s near-total capitulation to the demands of the country’s creditors or a return to the drachma. The notion that there was a middle way was a fantasy, born of ignorance of the political and legal realities of the eurozone, an overestimation of Greece’s geopolitical importance and an underestimation of the calamitous consequences of a euro exit.

In offering proposals this week that went a long way toward meeting the creditors’ demands, Mr. Tsipras appeared to concede that exiting the euro would break the only red line that ever mattered, his pledge to keep Greece in the currency union. He has no mandate to turn his country into another Mediterranean failed state.

Of course, it’s still possible that no deal is reached, plunging Greece into a disorderly default. What is certain is that any deal now struck will be a bad one compared with what was on the table five months ago, a consequence of the damage wreaked on the economy. Den Rest des Beitrags lesen »

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Divisions Remain as Eurozone Finance Ministers Meet Over Greece Deal

Posted by hkarner - 24. Juni 2015

Date: 24-06-2015
Source: The Wall Street Journal

Document outlines key differences between Greece and its creditors

BRUSSELS—Significant divisions remain between Greece and its international creditors over measures Athens must implement before receiving desperately needed bailout aid, according to a document seen by The Wall Street Journal on Wednesday ahead of a crucial meeting of eurozone finance ministers.

The finance ministers want to reach a deal at the meeting on what Greece must do in return for funding from its existing €245 billion bailout plan, without which Athens could default and potentially force a messy exit from the euro. But cracks were appearing in the newfound optimism sparked by a last-ditch proposal from Greece.

Greek Prime Minister Alexis Tsipras, in Brussels to meet with the heads of the institutions overseeing the country’s program, attacked creditors’ demands in messages from his official Twitter account. Den Rest des Beitrags lesen »

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European Central Bank Walks Fine Line on Greek Bailout

Posted by hkarner - 18. Juni 2015

Date: 17-06-2015

Source: The Wall Street Journal

 

Stakes high for Greece and ECB’s president, Mario Draghi as default looms

FRANKFURT—The European Central Bank faces a tough choice as acrimonious talks between Greece and its lenders push the country closer to default:

strictly apply its lending rules and risk making matters worse, or keep money flowing to Greek banks and damage its own credibility.

The stakes are high for Greece, which has been crippled by recession and soaring unemployment that could get worse if it is forced out of the euro.

There is a lot on the line too for the ECB and its president, Mario Draghi, who in nearly four years at the helm has steered the eurozone through recession and deflationary risks with abundant bank loans and bond buying. Den Rest des Beitrags lesen »

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What Happens if Greece Misses Payments?

Posted by hkarner - 18. Juni 2015

That’s all a huge threat, isn’t it? (hfk)

Date: 17-06-2015

Source: The Wall Street Journal

 

With little sign of progress in talks on Greece’s international bailout, some European policy makers are considering whether Athens could default but stay in the eurozone. The whole situation is fraught with unknowns, however. Here are some of the complications:

June 30. Greece must repay €1.54 billion ($1.73 billion) to the International Monetary Fund. If it doesn’t, the fund would issue an escalating series of warnings that could result in Greece being kicked out of the IMF after two years.

Also, if there is no agreement by then, Greece’s bailout expires. Then the question is whether the European Central Bank would cut off Greek banks.

The ECB’s decision would be based in part on whether the ratings companies define the missed IMF payment as a default. That isn’t a given because the fund is a preferred creditor and doesn’t hold any tradable securities issued by Greece. Therefore, the ECB may not pull the plug on Greek banks immediately—even though continuing to lend to them might end up putting more funds at risk. Den Rest des Beitrags lesen »

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Why Everybody’s in the Dark on Greece

Posted by hkarner - 16. Juni 2015

Date: 15-06-2015
Source: The Wall Street Journal By SIMON NIXON

Does Alexis Tsipras actually want to keep Greece in the eurozone?

Until recently, the answer seemed clear. The Greek prime minister fought an election promising to keep Greece in the single currency. Every survey of Greek voters showed strong support for euro membership. No one seriously doubts that a euro exit would be catastrophic for the Greek economy in the short term—and most likely in the long term too, given the potential for social and political turmoil. Sure, his Syriza party has been anti-euro as recently as 2012 and some of its leading figures have continued to argue for exit, but the bulk of the party seemed to have reconciled itself to membership.

Eurozone policy makers certainly always assumed that Mr. Tsipras was negotiating in good faith. They believed this even as he campaigned on a platform of tearing up the terms of the country’s bailout deal and reversing many of the key reforms; they continued to believe it even when he shunned the possibility of coalition with the centrist pro-euro To Potami party in favour of an alliance with the right-wing nationalist euro-skeptic Independent Greeks. They even kept their faith after he was elected when he provocatively began to follow through on campaign pledges to hire back sacked civil servants, cancel privatizations and make unfunded fiscal handouts. Den Rest des Beitrags lesen »

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High-Tech Solar Projects Fail to Deliver

Posted by hkarner - 14. Juni 2015

Date: 13-06-2015
Source: The Wall Street Journal

$2.2 billion project in California generates 40% of its expected electricity
Hi Tech Solar projectThe Ivanpah solar-thermal plant in California uses thousands of mirrors to reflect sunlight and generate steam.

Some costly high-tech solar power projects aren’t living up to promises their backers made about how much electricity they could generate.

Solar-thermal technology, which uses mirrors to capture the sun’s rays, was once heralded as the advance that would overtake old fashioned solar panel farms. But a series of missteps and technical difficulties threatens to make newfangled solar-thermal technology obsolete.

The $2.2 billion Ivanpah solar power project in California’s Mojave Desert is supposed to be generating more than a million megawatt-hours of electricity each year. But 15 months after starting up, the plant is producing just 40% of that, according to data from the U.S. Energy Department. Den Rest des Beitrags lesen »

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