Greece is drawing up drastic plans to nationalize the country’s banking system and introduce a parallel currency to pay bills unless the eurozone takes steps to defuse the simmering crisis and soften its demands. The ruling Syriza party said the government is determined to keep public services running and pay pensions as funds run critically low. It may be forced to take the unprecedented step of missing a payment to the International Monetary Fund next week.
We are a Left-wing government. If we have to choose between a default to the IMF or a default to our own people, it is a no-brainer.
“We will shut down the banks and nationalize them, and then issue IOUs if we have to, and we all know what this means. What we will not do is become a protectorate of the EU,†said one source. It is well understood in Athens such action is tantamount to a return to the drachma.
Going into arrears at the IMF – even for a few days – is an extremely risky strategy. No developed country has ever defaulted to the Bretton Woods institutions. While there would be a grace period of six weeks before the IMF board declared Greece to be in technical default, the process could spin out of control at various stages. A “critical sequence of events could unfold†once Greece misses a payment to the IMF. It would trigger a parallel default to the eurozone bail-out fund (EFSF) under the legal master agreement, and might force the EFSF to cancel its loan packages and demand immediate repayment. This in turn would trigger a default on Greek government bonds issued under the bail-out accord.
See financial times for more…click here
Note:
- The bulk of the Greek financial obligations are due this coming summer. At that time or earlier I expect to see the end of the Euro/Dollar backtest .
- Hopefully you understand that those (Greek savers) holding Gold will be the only ones preserving their savings. Anything else – and this includes Real Estate – will go down the drain…
- A Grexit is the best that can happen to Greece. It will be a kick-start of a new economic boom and recovery for Greece and the beginning of HELL for the European Intelligent Psychopaths (politicians).
