German to EU, Greece: FALL into LINE or ELSE!

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Late tonight Germany gave Greece THE FINAL ULTIMATUM while telling all the rest of the Eurozone to FALL INTO F**king LINE (behind Germany)!

What happened Tonight?

Germany presented Greece and Eurozone members it's final ultimatum for Greece a few hours ago, which shocked the other EU, Eurozone members, and the U.S. for being a "catalogue of horrors" (Der Spiel - the most reputable business publication in Europe and one of the most respected in the world which happens to be German).


The German terms demanded of Greece:

*Greece must speed on privatized of state enterprises and use that money to service debt
*Greece must park €50 billion assets in collateral, most likely in Luxemburg (Greece says it will only do €17 Billion)
*The IMF, ECB, and EU Commission (Trioka) will be sent to Athens to monitor and enforce the bailout program
*Troika members will have first say on all legislation before it is shown to Greek Parliament, to ensure it meets the bailout requirements.
*Greece will be forced to amend all legislation passed by the current government
*Greece must pass pension and VAT reform into law by Wednesday
*Greece must give up all fiscal sovereignty to the powers at be
*Other equally harsh demands have not been made public

Right now the Eurozone countries including Findland, France, Italy, etc... are upalled by the terms demanded by German.
Germany has publicly stated that all the Eurozone members must fall into line behind them to ensure this problem is solved or ELSE (they have threatened the other Eurozone members).
Germany is also vowing to punish the Greek people over their no vote last weekend, claiming the ultimatum is the result of it.
Chancellor Merkel (leader of Germany) states Greece must accept all these terms over the next day and pass them into law by Wednesday or face the ultimate conquences. This is Greece's last chance, no other offers if this is rejected.
Merkel says she's not afraid to eject Greece from the Eurozone and EU if the deal fails (If you leave the Euro, you are forced to leave the EU too).
If Greece complies, then negotiations will begin on Wednesday for the next bailout worth €86 billion over 5 years.

To make matters worse:

The Greek ruling coalition is fragmenting in response to the terms, leaving the PM with a minority government on the issue.
Greece's Parliament must approve the terms before they can be implemented.
It looks like Greece is heading to an early snap election.

So far Pension reform and collateral Assets are the main sticking points.

http://www.theguardian.com/world/2015/j ... s-of-talks

Will Germany with this round with the backing of the Eurozone or will Greece be forced out?

I would tell em to park it in a very unsunny place.

But can Greece afford to be given the boot?

Greece does get 10s of billions in Euros from the EU in infrastructure development, agriculture, and other areas.
They also get free trade with the EU and EFTA.

That money from the EU is more than Greece invests in itself.

If Greece is forced out, they would have to:
*Reinstate the Drachma
*Recapitalize the country
*Renegotiate terms of trade and other areas with the EU, allowing for Greece to do business with them
*Greeks would lose the right to travel into the EU until their country can get a travel deal with the EU.
*Foreign companies are threatening to pull out of Greece, if Greece leaves the Euro...
*Default on their debts and be punished by the EU, ECB, and IMF in some fashion for failing to repay their loans.
*Can Greece get anyone to loan them money if they default?

Which is worse the German terms or exit and collapse of Greece?

http://www.theguardian.com/business/liv ... -deal-live

Unanimous agreement is official for a final Greek bailout.
Greece has until Wednesday to approve the package if it wishes to remain in the Euro and EU.
Greek parliament is expected to pass it with mainly opposition parties backing the deal.

Practically everything is listed in the OP is part of the final agreement.
Though they did agree to give to Greece bridge funding to meet it's summer repayment schedule and recapitalize the banks, forcing Germany to agree to it.

Greece has agreed to park €50 billion assets in collateral which the funds will remain in Athens under the monitoring of the EU.

Merkel-"eurogroup is ready to grant longer grace period and longer loan maturities" a concession in favour of the Greeks (though sources are reporting very few concessions are made to Greece).
No haircut to Greek debt.

Greece ceases being a country with this deal, how can the people accept an even harsher deal when they just voted against the terms? Syriza and Tsipras lose all credibility, the fed up and enslaved Greek people will be pushed to even further extremes and it is hard to blame them because everyone else has sold them out. This the type of stuff that propelled the Nazis into power and Greece looks more like Weimar every day.

Current German economic success started with a bailout.

When Greece was first brought in to the Eurozone I thought it a train wreck waiting to happen. And here we are.

Greece loses fiscal sovereignty and is forced to restructure itself.
Right now Greece is horrible structured across the board.
At least half the population commits tax evasion, especially the rich and powerful upper class (who have resisted meaningful reforms).
Their economy is horrible inefficient to the point that Germany is able to import olives, refine said olives into olive oil, and sell the bottled product in Greece much cheaper than Greece is able to do, despite growing the olives themselves.
Greece also has a hugely bloated public sector, which can retire with full benefits in their early 50s.
Nearly all the money Greece invests in itself, ends up lining the pockets of the upper class instead of actually building up the economy.

Greece's only hope for meaningful restructuring is accepting the terms imposed by EU, IMF and ECB.
They've constantly failed to do it on their own even after previous governments agreed to do so as part of the previous bailouts.


Not exactly true.

When WWI ended, UK and France imposed vindictive terms in order to cripple Germany both militarily and economically to prevent Germany from ever recovering securing British and French power in Europe.

The following decade of hyper inflation and economic collapse that followed, paved the way for rise of the Nazi's.
The only way Germany was able to rebuild its economy was through rearming and WWII.

When Germany surrendered at the end of WWII in Europe in 1944, the UK, France, and USSR wanted to strip Germany of everything as punishment for a second bloodier war.
The U.S. realized that the vindictive punishment doled out in the Treaty of Versailles on Germany forced Germany to go to war to save itself from ruin.
Since the UK and France were dependent on American aid to stabilize and rebuild, they had to agree to U.S. terms.

The U.S. dictated that West Germany be rebuilt into a full functioning industrial economy under Western Allied control, in order for them to get part of the Marshall Plan, loans from the World Bank and IMF.
All other countries were forced to drop all claims against Germany in order to get their share of the Marshall Plan.
Germany's war debt was also reduced by half and restructured, it was repaid in the 1980s.
Germany just recently repaid the WWI reparations.

East Germany on the other hand was stripped of nearly all industry by the USSR, with it all being shipped back to USSR to rebuild the USSR.
Stalin was very cruel on East Germany.

West Germany was forced to sign a private deal with the Allied powers, especially with UK and France in order to be allowed to annex East Germany, for reunification.

Part of said deal that has been leaked was the following:

Germany was forced into a monetary union with Western Europe (The Euro)
Germany would underwrite the monetary union (which they have)
Germany would be forced to bear all costs if the monetary union failed and could only leave the currency after all other countries have left.
Germany also had to agree to full union with the EU countries
Germany had other economic stipulations forced on them.

This monetary, political, economic and soon to be fiscal union at the EU level exists mainly to keep Germany in check, giving France veto power over Germany (which it has to a large degree).

Oddly enough, Greece was the only country to reject the Marshall Plan, instead choosing to sue Germany in international court for war reparations...

I've been reading Durant's History of Civilization, wherein he cites Socrates as having identified a cycle to Greek politics and economics. This was circa 2400 BCE. Socrates said it works like this:

First, in periods of democracy the masses vote for themselves extravagant entitlement benefits. (Not unlike today.)

Second, this eventually results in the predictable economic collapse and mountains of debt. (Like today.)

Third, the masses scream for forgiveness of debt and a fresh start, leaving whoever was stupid enough to lend them the money that underwrote their foolish holding the bag. (Sounding familiar yet?)

If Socrate's cycle continues to repeat itself, the next phase will be economic collapse followed by a StrongMan with good oratory skills coming in and cleaning things up (think Facism). Mr. StrongMan will eventually become despotic, will be thrown out, democracy reinstated, and then the whole cycle repeats itself.

Soo...... I must admit to being fascinated while watching Socrate's observations from 2,400 years ago being replayed.

Iceland told the IMF et al. to go to hell. Within a few years it returned to national stability. Oh, yeah, it also tried, convicted and imprisoned its "banksters" who sold out the nation and got it so near international custodial bankruptcy.

It can be done and easily.

This time Greece's creditors are countries and the IMF who are owed hundreds of billions of Euros.
This time the cycle should be broken to prevent Greece from ever running up another huge tab they cannot repay.
The world is sick of Greece and is taking the necessary measures to prevent it from happening again.
Greece is long overdue for this.


That is also not entirely true either.

Iceland is a very liberal country with a population of 300,000
Iceland has the structure in place to move quite fast, if necessary and can absorb most shocks.
Iceland also forced the banks that had operations in Iceland to pay huge penalties and seizing of funds held in Iceland.
Iceland was in talks with the IMF, if their plan failed.

Iceland is pretty much detached from the global economy do to its size and lack of imports and exports.
Hell NATO is one of the biggest parts of Iceland's economy due to the bases and troops.

The banks have not forgotten was Iceland did and are suing them in court over it.
Though the Banks are also suing the U.S. over bailouts, with first rulings to be handed down soon.

Greece on the other hand had been borrowing money for very long time before joining the Euro.
Greece after failing numerous times to restructure itself, elected a string of governments that bowed to the upper class preventing the restructuring.
Greece then hired the major banks to cook their books and hide their debts and deficits to get into the Euro.
They retained the banks to keep it up once they entered the Euro, so Greece could borrow like crazy.
Greece hoped that the economy would grow enough from joining the Euro, preventing restructuring, which in turn prevented angering the upper class, which would offset high borrowing rates.
As long as the interest rates were essentially nothing, Greece could keep servicing it's debts with easy while still borrowing.
Those Greek Governments didn't worry about it, since if anything bad came to pass wouldn't happen on their watch.

When the market tanked, the interest rates rose quite high and those debts were called in.
Greece was left literally with no money to pay it's creditors with, forcing it to restructure and actually enforce the tax laws.
Greece failed to do this, thus forcing to turn to their EU partners and the IMF for help.
IMF, EU and ECB gave them a nice deal that included those necessary restructuring and reforms, they also would trust Greece in carrying them out.
It didn't really work....
Greece came back for a second bail out with slightly stricter terms.
Greece failed to do that too.

Thus we got to the current point where Germany and co had literally given up and were a few feet from walking out the door for good this morning, when the EC president intervened getting the deal.

Greece was forced to accept international control when it came to restructuring and reforms and the rest of the deal, in order to stay the Euro and EU.
In exchange Germany and co. would agree to restructure Greece's debt, making it easier to pay off.
It was a literal take it or leave it deal for Greece, who had no where else to turn (Not even Russia was willing to come to their aid).

As of today most of the other countries who were bailed out by the EU and IMF have exited bailout and repaid their bailouts, this is Ireland, Spain and Portugal.
Italy is nearing the nearing the final stage once it's reforms are completed.

All of these countries have growing economies at steady rates, with no budget deficits.

I'm glad I'm not the only one that feels this way.
I am still perplexed, though, at how German banks allowed themselves to become so overextended in this mess. I would have thought better of German banks.

I heard that that one of the conditions put on Germany for allowing reunification was that they had to full heartedly dedicate themselves to the European project. They see it as a sacrifice they need to make in order to purify themselves of their past sins.

Public opinion outside of Greece is against Greece.

As it has been said a few times in this thread, Germany was "forced" to fund the European Project and Euro.
Essentially Germany was forced to underwrite the system and pick up the tab if it failed.

German reunification came at a huge international price and monetary price (€2 Trillion and counting to rebuild East Germany).



There has never been a public acknowledgement of private deal the Germans made to the French and British for Unification.

Ah, ok. Thanks for the extra background info.