Via The Slog we learn of a document, circulating around two large American banks, which seems to be a time-table for the ‘controlled default’ and Greek exit from the euro.
The document asserts that Greece will officially be declared in default by all the ratings agencies after the close of business on Friday march 23rd . At the weekend all Greek bank accounts will be frozen, with emergency measures detailed to prevent the flight of capital. Included in the paperwork is a list of very limited exceptions to the ‘no withdrawals’ order. All major banks ‘are instructed not to deal with euro exchange as of open of business in Greece on Monday 25th march. All Greek markets will close for one day ‘at least’.
Mark your calendars: March 23rd, after business hours. That’s supposedly when the world (or at least the EUnion) will get even more interesting.
The two banks in possession of the document are Barclays and JP Morgan. And if you’re wondering why two US banks would have this document, but no mention is made of EUro banks with a similar time-table: Merkozy are *not* in control. This is the Obama administrations doing. Moreover, there seems to be a similar planned exit for Portugal.
Further enquiries have revealed allegations that first, “the White House played hardball in several meetings with top bank currency traders” to ensure that “the Greek thing didn’t get out of control and ruin Obama’s chances”; second, Portugal is described as being “in the frame” for a similar process; third, the documents are from the Federal Reserve not the Treasury; and lastly, both the IMF and senior members of the German Government are in the loop.
It seems to me there are black arts at work here, and I’ve no desire to be suckered by them. Some of the media information out today since The Slog’s original piece is potentially conflicting, as indeed is some of the history surrounding this story. The biggest of these is the ‘split’ now alleged to exist between Merkel and Schauble about “what to do with” (lovely choice of phrase, that one) Greece. The story put out – and run by the London Financial Times this morning GMT – is that Schauble wants Athens to default, and Merkel doesn’t.
I think the story is bollocks. Superficially it rings true, but in reality this is an obvious attempt to deflect the flak away from Merkel after yesterday’s outrage at Berlin’s suggestion of postponing elections in Greece.
This is all not that far-fetched as the last days saw manouvres in the EUrozone that indicate Greeces time as a EUnion member is well and truly up. It was inevitable two years ago, but now, at last, the political will to accept the inevitable has finally settled in, it seems. For better or for worse. But this does mean that a Greek exit from the euro, barring any black swan event, is now all but a dead certainty.
Or, as EURef calls it: The fat lady clears her throat.
The rhetoric has turned poisonous, says Ambrose as he catches up with events. He judges that Berlin, Helsinki and The Hague show every sign that they intend to eject Greece from the euro whatever it now does, calculating that the eurozone is at last strong enough to withstand contagion.
Theoretically, we should be seeing a resolution on Monday, when the Eurogroup finally meets. But Dutch minister of Finance Jan Kees de Jager (NL) is indicating that the Netherlands will block the bailout.
From that source, we learn that, even if everything goes well, Monday will only deliver a “preliminary agreement”, creating a parliamentary reservation for the Netherlands, Germany and Finland.
Behind the scenes there is a lot more going on then this (already longish) post is able to convey. Check out a few of the links given above to get a flavour of the rather sudden quickening of pace events have taken this week.
And what is the role of (unelected) Italian PM Mario Monti in all this. Both the Slog and EURef shine there considerable light on this impeccable but rather shady former Goldman-Sachs boyo. Allegedly, he’s the one that persuaded Merkel the Greek bail-out money could be put to better use (like, eehm… Italy).
Much is going on. Where will it all lead?