Wednesday, February 22, 2012

Fearless Prediction: On March 20, Greece Will Default



On March 20, Greece has to come up with €14.3 billion—or else it will be bankrupt.

Of course, Greece doesn’t have €14.3 billion—that’s why the Troika of the IMF, the EC and the ECB are trying to hammer out a deal to bail them out again: A bailout to the tune of €136 billion. They’ve had marathon-length negotiating sessions, one “crucial emergency meeting” after another—hell, they even called the Pope to send them a case of holy water and a truckload of wooden stakes. I’m serious!

Last Monday, a deal seemed to have emerged: That’s what the announcement sounded like. In fact, it looked so much like a done deal—it was spun so decisively as a done deal—that I was all set to write something snarky like, Greece Takes It Greek Style: “Thank You Troika, May I Have Another” Bailout On Its Way. (What can I say: I’m a vulgar bastard.)

But then . . . then we all started looking at the fine print of the deal. And that’s when everyone who follows this stuff started to realize that the deal wasn’t a deal—merely the illusion of a deal.

A motto of mine: Never try to do the work someone else has already done for you. In the case of analyzing the Greak “deal”, I turn to John Ward, who pretty much nailed the critique of the deal:
1. [A]lthough the ECB has made a reasonable fist of complicating its subordination of the private bondholders – money out, profits redistributed, local central banks reinvesting and so forth – it remains a preferential deal done outside this so-called ‘bailout with PSI’. The IIF creditors have sort of voluntarily taken the extra 3.5% hit, but the coupon they’ve been offered is worth less than the original. In a statement issued by representatives of private bondholders, the new interest rates – 2% for the first three years, 3% for the next five, and 4.2% thereafter were described as “well below market rates”, and the creditors will lose money on them. The tone of the statement screams ‘involuntary’. In English, all these factors spell default.

2. Nobody has actually signed up to anything yet: as usual with all things EuroZen, the bankers are alleged to be on-board, but the IIF statement made after the press conference suggests otherwise: ‘We recommend all investors carefully consider the proposed offer, in that it is broadly consistent with the October agreement’. That’s not true for one thing: but as a recommendation, it’s somewhat limp. Further, there is still a body of hardline ezone sovereigns who don’t want to do the deal – and in Germany itself, a growing rearguard campaign to stop it. (See this morning’s Spiegel for immediate evidence). And finally, most Greek citizens themselves will react violently to some of the more pernicious clauses.

3. The ‘agreement’ contains almost a full bottle of poison pills: Berlin has got its debt Gauleiters in the end, only 19 cents on the euro will go to the Greek Government itself, 325 million euros in additional spending cuts have been found, Athens has agreed to change its constitution to make debt repayment the top priority in government spending, the escrow account must have three months debt money in it at all times etc etc. The idea that Greece can now toddle off and have a liberal democratic general election without any of these being issues is Brussels space-cadet stuff at its most tragi-comic. (An opinion poll taken just before the Brussels deal showed that support for the two Greek parties backing the rescue package had fallen to an all-time low while leftist, anti-bailout parties showed gains.)

4. Several Grand National leaps lie ahead before the default is avoided. Parliaments in three countries that have been most critical of Greece’s second bailout – Germany, the Netherlands and Finland – must now approve the package. In Greece itself, further violence will test political resolve about yet more cuts in wages, pensions and jobs. Greece’s two biggest labour unions have already lined up protests in the capital tomorrow. Very significantly, Jean-Claude Juncker of Luxembourg and the IMF’s Christine Lagarde stressed at the press conference that Greece still had to live up to a series of “prior actions” by the end of the month before eurozone governments or the IMF can sign off on the new programme. If ever I saw a get-out clause, that’s it.

5. Other loose ends are left hanging everywhere. Nobody has elicitied any response so far from the Hedge Fund creditors. Entirely absent from comments was the IMF’s contribution to the €130bn bail-out. Christine Lagarde would say only that the contribution would be ‘significant’, but my information is that she’s lying through her $240,000 teeth as usual: the IMF will only contribute €13bn to the in new Greek funding. Not exactly a resounding vote of confidence for the deal. Juncker said he was optimistic that ezone members would cough up more cash at the EU summit in March, but this too simply doesn’t bear examination: Portugal is broke, Spain is technically insolvent, Italy has asked to be excused from this dance, and Germany has already shown extreme reluctance to to increase its exposure further still. Fritz Schmidt in dem Strasse isn’t too keen either. Finally, as Bruno Waterfield notes in his latest column at the London Daily Telegraph, the agreement remains ‘overshadowed by the pessimistic debt sustainability report compiled by the IMF, ECB and Commission, that warned of a “downside scenario” of Greek debt hitting 160 per cent of GDP in 2020 – far higher that the agreed 120.5 per cent target’.

6. This is where we get to what the MSM will largely dismiss as ‘conspiracy theory’….but for which the circumstantial and corroborative evidence gets increasingly compelling: whole crowd-scenes of actors off-stage (and several on it) simply do not want this deal to reach fruition: they have factored in a Greek default, and believe that the best way to avoid further debt-crisis contagion is for the money earmarked for bailouts to be invested in bank-propping and growth.

The cast of players who think this include David Cameron, Mario Monti, Mario Draghi, Wolfgang Schauble and most of the German Finance ministry, Christine Lagarde, probably Angela Markel herself, Tim Geithner, huge swathes of the German banking community, The White House – and elements in both Beijing and Tokyo.

(Emphasis added.)
John Ward nails the essence of the Greek deal: There is no Greek deal—just the illusion of one.

My only quibble with Mr. Ward is his point 6.: He writes that “whole crowd-scenes of actors off-stage (and several on it) simply do not want this deal to reach fruition”, which I think is accurate—but not for the reason Mr. Ward posits: I think the eurocrats have given up on Greece not because they “believe that the best way to avoid further debt-crisis contagion is for the money earmarked for bailouts to be invested in bank-propping and growth,” as Mr. Ward writes.

Mr. Ward is making a smart financial analysis of the situation. But the big decisions in macro-economics are never financial: They are always political—always. And politics is ultimately about psychology.

I think the eurocrats won’t bail out Greece not because they believe letting Greece default is the best way to avoid contagion: No, I believe the eurocrats will let Greece default because they no longer trust the Greeks or the Greek leadership.

Trust is like virginity: Once you lose it, it’s gone for good. Add to that truism a basic observation: If two parties truly want to make a deal happen, then the deal happens as if it’s on rails.

The key players of the Troika and the eurodrones generally just don’t trust Greece anymore. The Greeks have burned through that particular capital a long time ago. And by the passive-aggressive negotiation style of the eurocrats, they’re making it crystal clear that they do not want a deal with Greece. If they truly wanted a deal, it would’ve happened by now.

They don’t want a deal because the eurocrats and Establishment drones charged with saving Greece—for all their obvious flaws—are neither stupid nor blind: They realize that Greece is in all likelihood a never-ending hole. Whatever deal they hammer out now, they’ll have to hammer out yet another bailout package in 12 to 24 months’ time.

They realize—even if they don’t want to or can’t articulate it—that saving Greece is simply throwing good money after bad.

So they won’t. They will let Greece default. And the way they will do that is by demanding such egregious conditions—such as giving up Greek sovereignty—that Greece will refuse the bailout, or get locked into more and more negotiations, until March 20 finally rolls around.

Then it’s game over for the Greeks: They will default, exit the eurozone, go to the drachma, devalue, and go through hell for a few years.

It has now become too expensive—financially, politically, psychologically—to save Greece. The holes in the Monday deal show that there is no deal—and there won’t be any deal.

So on March 20, Greece defaults.

Now . . . if Greece defaults . . . then what about the rest of the eurozone?

Ahhh: That is the real question.
At my Strategic Planning Group, we have game-played what will happen when Greece defaults, and how it will affect the eurozone, other economies, and other asset classes. If you’re interested, check out the preview page.

71 comments:

  1. I think Greece will collapse. will it be default or failure to stop spending money theyu don't have? The difference this makes is "when" it happens. If the EU gives them more money then they will avoid default on the 20th. But I don't think they have the will to live within their means and rebuild their economy through hard work.

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    1. this is totally wrong to think it has anything to do with hard work. Greece population is no different than any other people around the world. the mess they find themselves in is the result of their corrupt government (both are member of the zionist CFR) and the zionist banker who want to enslave everyone on the planet. Hard work is not the problem for greek, only brainwashed people by the zionist media think that it has to do with the people of Greece. maybe yo'll be saying this about every country in europe, what's next spain, portugal, france , Italy, Britain because they are all slated to default some time or another..the USA is also on the line. Corrupt capitalism is the problem.

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    2. So what is the endgame? At this point I think it is all out chaos. If they really wanted to solve things they would consolidate all debts into a single Eurobond. They are smart people it is not possible that I am the only person who realizes this. However lets go one step further and ask why so much debt in the first place? I posit to you that highly leveraged banking debt foisted upon the populace of *insert country here* IS part of the plan. But this is not about solving anything and neither is the occupation of Eurasia in the name of terrorism by western elites(CFR). Sure petrodollar hegemony is being enforced by the barrel of a gun to maintain the value of a world reserve currency, but truly to what end? Last I checked America is not competitive nor innovative. From the ashes of the worlds greatest depression and the worlds greatest war(Iran?Russia?China?) will be a world population begging for a world financial construct to end depressions and a world army to end all wars. That is when humanity goes into decline.

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    3. Stop with the Zionism already! It is all about the failure of Socialism / Fascism as an economic model. Gummints cannot spend more than they get from taxing the proles.

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  2. Hmm... I hope you have better luck with this fearless prediction then you did with your USD prediction...

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    1. Move along, troll.

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    2. I don't view this as a troll type of comment.

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    3. What he probably meant was ...
      "You were bold enough to take a risky shot at the USD prediction ... and sometimes they fail!"

      The ability to take risky call is in itself admirable! :)

      "Lets hope that this time you are right and your star shines for taking such a bold, contrarian stance!!!" :)

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  3. point 1.
    Greece has already defaulted.

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    1. Yep. "..IMF, the EC and the ECB are trying to hammer out a deal to bail them out again.." The only thing that will hammered out will be Greek nads

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    2. I am confused by the competing arguments posted by anonymous.Anon

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  4. if there is a Greek default it triggers CDS's, hundreds of millions of them $ paying 500:1. Thats what we need to worry about, a cascading avalanche running through world banking

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    1. Wow. Better get rid of currency and buy some gold and silver to protect yourself with.

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    2. They won't call it a default, they'll call it negotiated instrument of flexibililty or something.

      As in, "Hey, Goldman Sachs, I bought life insurance for my grand-dad. He died yesterday, pay up."

      GS: "Sorry, but he's just sleeping."

      Me: "What? He's lying there on the slab, not breathing! What do you MEAN he's not dead!?"

      GS: "Sorry, but we only pay insurance when he's dead. He's just sleeping."

      Me: "I'll sue your lying ass off."

      GS: "Officer, this man is harassing our office. Arrest him forthwith. Hold on a second ...ok, take him away."

      Delete
    3. Love ur gsux view and have u read what Rolling Stone

      thinks about gsux? Great read and good luck to all as

      we are going to need real soon. Dj.

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    4. CDS defaults are only designated as defaults if a committee sits and decides so. One of the things that killed MF Global was their 50% loss on a bad bet, and their CDS hedges didn't trigger.

      https://goldsilver.com/new/jim-sinclair-the-impending-undeclared-default-of-5-major-us-banks/

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  5. Great article. Can we doubt that Greece will refuse to become a slave nation, and succumb to that level of abjectness? The author responds: preposterous. Unfortunately its not because of Greek nobility that this won't occur (*if* it doesn't) but because other nations see them as sly, untrustworthy and deceitful. However it turns out it will mean abjection for Greece, and this is probably a very sad thing.

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  6. There is no 11th marble.
    Why does anyone think that the bankers are honest guys? The Greeks did not do this to themselves.

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  7. Aristotle Lives and reasons still

    Greece need not pay the debt from its own effort. It ony needs to endorse the WWII compensations Germany owes it since the and never paid.. If to that value you add the same interest rates, fees and penalties Greece paid for its debt you will get a number superior to what Greece owes today. Just endorse the IOU and then the debtors can go to Merkel to collect… Meanwhile she is playing distraction by ripping her clothes off in dispair and accusing the Greeks of being irresponsible… If Greeks are so, she is a crook.. The pot calling the kettle black?

    Theodorakis says it well: http://poorrichards-blog.blogspot.com/2012/02/there-is-conspiracy-to-destroy-greece.html

    Also see: http://9gag.com/gag/2681884

    And you will realize from this last one should the blame be assigned to.
    The people, like all people sucked at the lollipop which was given to them.
    The government like all governments cares nothing about the people.
    The Politicos/Banksters took advantage of this and made the move.

    Anybody (Economist, Analysts, Reporter) who thinks that the Politicos/Banksters did not know the condition of their debtor (Greece) is frankly clueless as to how things move today… Hey if that is your case I have a beautiful Brooklyn Bridge for sale and I have been given the authorization to sell it in exclusive… any takers.??

    As I understand, Mr. Papadimas, the present acting prime minister of Greece, a Bankster minion all his life, and imposed by the EU for this position was, at the time Greece joined the EU the president of the Greek Central bank… he cooked the books with Goldman Sachs… Don´t tell me he betrayed his bosses the Banksters ¡!!

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  8. Gonzalo, I admire your guts crawling out on that limb, I doff my helmet to you. Greece will default I think it’s a matter of when not if the numbers simply just don’t make sense, and the Greek economy is being crushed. I think the Million Euro question is who’s next Spain, Italy, or Portugal, and will the IMF and the Eurodrones (love that term) play this same game again or will they simply cut the dead wood. Oh, BTW my guess is Portugal, and the band is warming up.

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    1. Gonzalo fears no man!! He is made of steel or was it gold and silver? Something like that. lol Most of us on here could only be killed by a gold or silver bullet. lol

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  9. Hi,

    This crisis is not about the solvency of Greece per se, it's about the solvency of the European banks. Greece is a temporarily conquered territory, not of Germany, but of the banks. So Field Marshal Angela et al, who serve the banks, will fight to the last Greek, French, and German taxpayer to hold the line in Athens. No retreat.

    At least until the hopeless position crumbles, perhaps on March 20th, with the Greek economy ravaged, lots of European money wasted. and a number of real people in Greece actually dead.

    Then they'll be sure to declare that Greece doesn't matter, never did, it will be "ring fenced", and further money will be used for "bank-propping and growth" - well maybe bank-propping at least. Sound familiar? Future maps of the Euro zone will include Greece and will be captioned "The Troika's Empire of Debt at it's greatest Extent, early 2012".

    My call: They'll do everything they can to save Greece because absolutely nobody in the High Command wants Greece to default. Because if Greece defaults, the whole thing might/will come unraveled. But if/when it does - and maybe GL's right about the 20th - the High Command will do everything it can to prevent the conquered populations in the rear from revolting. Watch the "resistance" movements in Ireland etc. go into full gear just like the French and other resistance movements went into full gear after Stalingrad.

    German taxpayers, to their shame, will eventually discover that for the High Command, the Germans themselves are subjects of a corrupt banking regime, and are seen as no different from any other taxpayer population, including the Greeks. That they're just another population to be used by bankers and their politicians.

    This whole "well we really wanted Greece to default all along" has the smell of bad faith and face saving desperation about it. Oh yes, and as sculptorbill points out, then there are all those CDS's out there to worry about.

    Regards,

    Unna

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    1. "This crisis is not about the solvency of Greece per se, it's about the solvency of the European banks."

      Repeat that to yourselves class. And you'll see that ***Greece won't be allowed*** to default until their gold is gone--and probably not until the banks have gold promises for bailing out Portugal, Italy, Ireland, en Espagna.

      Delete
  10. I agree that Greece is going to default on March 20. There is no way the troika, especially before LTRO 2 gets underway, politically comes out and says: Greece is going to default.

    They simply have to appear they are trying to work out a deal for political reasons and they can't have a complete bank run on Greek banks before then. It's why politicians can never tell the truth; it would only exasberate the problem.

    It's also why LTRO isn't really QE; it's actually the grease the banks in Europe need once Greece defaults and Tier 1 capital ratios get nailed along with the frozen market of stunned citizenry. Everything Merkel has said would corroborate that. So too, the German people who know all too well what happened during Weimar.

    Greece will default. And those expecting LTRO 3, 4, and 5 are going to be rethinking there entire life soon.

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  11. Gonzo--I think you will do better with this prediction than your 'deflation undertow' call. In fact, the two positions are somewhat contradictory. The powers that be crossed the financial Rubican in late 2008, and there no turning back. Everything will be papered over, pun intended, and they won't risk any deflation.

    This is why oil and gasoline are going higher, even as demand for the same is dropping. Because oil traders can see the tsunami of cash on the horizon.

    If an Iranian war was inevitable, why hasn't Wall Street sniffed out that inevitability yet? On the other hand, a Greek default isn't even a concern, since they already have shown they have the creativeness to bail out the banks without raising an eyebrow.

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  12. The one who is making this "fearless prediction" is John Ward. He has been saying this for at least more than a week. It is shameful to copy and paste other's opinion, make a few adjustments, and imply that the original writer is not as smart as the copier!

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    1. Your point is well taken, though I do not think anyone intends to claim the copier produces better copy than the original!

      So here goes ...

      "Three Cheers to John Ward!"

      echo ...

      "Three cheers to Gonzalo Lira!" :)

      Does that set the heirarchy right?!

      Delete
    2. LOL Max Keiser has been saying it for possibly a year or more since the truth about the cooked books came out soooooooo...John Ward who?

      Delete
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    ReplyDelete
  14. Oooh, another Gonzalo prediction! I love these! They never come true!

    Here is a counter-prediction of mine: Greece will NOT default on March 20. (It will default later, though.)

    Oh, and don't worry about those CDS. They are old news. Why do you think the EU dragged its feet through 3 years of bail-outs, when it has been crystal-clear since day one that Greece was hopelessly insolvent? To buy time, of course, that's why. By now, most of those CDS have been bought back (with taxpayers money, of course). There are only about 3 billion dollars worth of them outstanding and they aren't a problem at all, since collateral for them has already been posted. So, when Greece eventually defaults, everybody will just breathe a sigh of relief.

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    1. thanks for the info, now, the math....let me see 3 billion times 500 to 1 ...is that 1.5 trillion?

      Or are you saying only only 1.5 million of these CDS's were purchased that pay off a total of 3 billion (500:1) upon default.

      Maybe we'd better look at your data source

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  15. Reading your predictions on inflation (and comparing to Krugman's) made me a Keynesian. Which I was not.

    But in this case you might be correct. Indeed lots of people are predicting this. It seems to be more a case of "When" than of "If".

    I suspect though that it will happen after the Greek elections, not before.

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  16. If Greece defaults on March 20th, what is the impact on the Gold price in U.S. dollars and Gold equity shares?

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    1. At my Strategic Planning Group, we have game-played what will happen when Greece defaults, and how it will affect the eurozone, other economies, and other asset classes. If you’re interested, check out the preview page.

      Delete
  17. Ummm, the International Swaps and Derivatives Association gets to decide what is a default and who gets to default and since this board is made up of bankers and hedge fund managers, you have to "psychologially, Gonzo, look at it from their perspective. Does the ISDA really want to label Greece a default at this time? If so, how many CDS's were traded against Greece and who owns them. I don't think anyone knows when or if Greece will ever be labeled a "default" but if that day comes, you can be well assured that it'll be in the best interest of the bankers and not of the people of the world; and certainly not the people of Greece.

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  18. It appears to me that the banker and political classes have engineered instruments designed to take away liberty from "their" people and transfer it to them. If so, the process of enslaving "their" people is well on it's way and the process of "helping" the Greeks only entraps the others of the euro-zone more completely leading them collectively into monetary and political slavery. This will be orchestrated for the maximum benefit of that process. Hence "peace" will reign in Europe from the serfs unable to fight.

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  19. I agree %100 with the March 23rd call. I will go one step further and call a US/Israel attack or false flag on March 8th.(Purim) They(Israel) have kicked off many wars on this 'festival' and since this war will be the biggest-- they are most assuredly will want to celebrate the killing of the Persians and show the world their entire control of the system. The last war as stated in the Protocols is between Jew and Muslim and both are destroyed.
    War must come first to disguise and distract from Greek/Euro/US dollar collapse. So when Greeece goes on the 23rd war must already be in full force.

    Throw in the non-verified banking document 'telling the date of the greek collapse'. Operation Bold Alligator finishing and all the troops going to surrounding bases of Iran. The leaked CBS graphics designer stories that he has-"Been working on all the Iran war graphics for weeks"
    The rental of all rooftops in Telaviv by the news agencies. The 100,000 plus troops ready to roll off the coast of Iran. 5 Aircraft Carriers(Including 50 year old Liberty) Off the coast. Ect Ect.

    Here is the kicker to the timeline and a logical question to ask-

    "If the greek default and cascade of events is to take place much further this year then why would all these bankers not hold there postions later into the summer??"
    If they know that the system will hold up wouldn't they wait in power as long as possible to control the events better??

    http://www.24hgold.com/english/news-gold-silver-all-the-big-banksters-resign-this-has-to-be-more-than-a-coincidence.aspx?article=3812034480G10020&redirect=false&contributor=Charleston+Voice

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  20. Inlude links for above comment-
    The greek 1 year bond passed hit 819% yesterday.

    http://www.bloomberg.com/quote/GGGB1YR:IND

    Greece is on fire. 45 Buildings in Athens burnt to the ground just in the past few days, People are threatening to jump from buildings, fireman are hosing down the police The Polics have said they will arrest any WorldBank or IMF official in Greece, they are looking at charging the Greek politicians with Treason(as well they should)--ect ect.

    http://rmiglobal.org/2012/02/17/newsflash-athens-da-peponis-indicts-papandreou-and-papakonstantinou-for-treason/

    Now Iran has stopped all oil exports to 6 euro countries including Greece which gets 30% of its oil from Iran. http://uk.reuters.com/article/2012/02/15/uk-iran-oil-europe-idUKTRE81E0RX20120215


    -All the major news agencies have rented the rooftops of TelAviv(Looking to get some good fotage of Irans counter attack) http://www.bloomberg.com/quote/GGGB1YR:IND
    -Leaked documents show that the news agencies have been 'practising' for war for the past few weeks. http://www.youtube.com/watch?v=BRItO4rRFlw
    -Further, Oil has been going up in price all this week.It is an options and futures expirey week. I have been watching oil price very closely for over 4 years. OIL PRICES HAVE (Rarely as in almost never) GONE UP just prior to options expirey. They always go down. My thoughts are that they(the people in the know) are loading up on OIl options and futures prior to OIL going through the roof in the next 3 weeks.

    March 20th Major greek bond payment is due 20X (15 Billion) http://investmentwatchblog.com/stunner-greece-has-to-borrow-20-times-the-face-amount-of-their-bond-payment-due-march-20th-in-order-to-continue-operations/

    Leaked documents show that the major banks(JP Morgan et all) have been told that greece will default on March 23rd http://hat4uk.wordpress.com/2012/02/16/greek-default-exclusive-senior-us-bankers-given-explicit-timetable-for-athens-default/

    March 22nd Greek announced insolvency and defaults on its debt. Bank Holiday,

    Cascade of defaults throughout the Euro in the last week of March-beggining of April

    US Dollar defaults(Bank Holiday) by Mid April. (Max 2 weeks of Euro default)

    All paper assets in ANY currency are devalued by 50%, Physical- Gold and Silver will double and triple on the same weekend.

    That gives you approximately 50 days to get out of ALL paper and into Physical Gold and Silver, reduce any Variable rate Debt or convert to fixed rate, and get rid of any vehical that gets bad gas mileage.
    Sell any BS crap you own and buy Silver.

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  21. Grammatical nitpick: Fritz Schmidt in der Straße (in Switzerland Strasse is also okay). If Strasse is not the target of a movement, the preposition in request the dative. Strasse is female therefore you must use the dative singular of the female definitive article: der.

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  22. Apparently ... European banks may be able to lay claim to all the gold (in excess of 100 tonnes) belonging to the Greek national bank. In reality - that gold is the property of all the ciizens of Greece. If this is not the last straw in the rape and pillage of Greece ... I don't know what is. Political chaos - here we go. Can you really blame Greek citizens for being angry?

    PeteCA

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  23. IMO: The most significant thing about a Greek default (to the rest of the world) will be that naive investors will now see that default really is possible, that miracle cures are not guaranteed, and that the rest of the PIIGS really are in mortal danger. Then their bond rates skyrocket, cascading defaults will start with the PIIGS, then transition to failing banks in the rest of the EU, which will then leap over the Atlantic and start grim reaping banks here.

    Etc., etc.

    Steven in Dallas.

    PS: The most significant thing to the Greeks will be finding out that nobody wants to sell them fuel or food, and that they are self sufficient in neither of these commodities. I'm not being mean spirited, just dismally honest.

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    1. >> and that they are self sufficient in neither of these commodities

      And THAT lack of self sufficiency is a byproduct of the IMF's model of global economic development. Efficiency and specialization also mean that you are no longer diversified, no longer self sufficient, and are at risk to the supply whims of your trading partners.

      Delete
  24. "On March 20, Greece has to come up with €14.3 billion—or else it will be bankrupt".

    WTF....GREECE IS BANKRUPT. I'd even go so far as to suggest it was probably close to if not already bankrupt when it joined the EU. You make me laugh GL.


    GL,
    You and the SPG are supposed to be ahead of the curve.
    I alluded to this "default" and the urgency of same in the last blog.....and there you were concerned about deflationay undertones......

    This is not news...and far from what I call a prediction.
    The market "knows" about Greece...it "knows" about the bank saving....it "knows" about the money flow....it "knows" about the political motives....it "knows" how screwed EU is.
    What's interesting is the through all the desperation and face saving...ultimately it will not be Greece that drops the bombshell...NO my dear friend...it will be the sinister Credit Rating Agencies.....the very same that have delayed the inevitable ( at the behest of their buddies in the BIG 5 and the FED). They (or at least one of them) have Greece on a credit rating of just ..."C". That is in default parlance, like standing on a rope while someone is cutting it with a pair of scissors. A "C" rating is one level above "official DEFAULT".

    So...with all the "hard" work done and yet more printing and bank/ sovereign saving to come (end of the month), we will have a default called by the CRA. This will come at a most inconvenient time for all...after markets close for a weekend, for eg.

    AND it will come not from Greece (bcos of their interconnectedness and bond with EU....lol), it will come bcos it is long overdue and the CRA's need to save face. Ask yourself how would they be viewed if Greece comes out and calls bankruptcy before the CRA's get the opportunity to declare it. Sort of like the cart dragging the horse dont ya think.

    The Greek Tragedy has dragged on for 2 years. It has already technically defaulted on several ocassions and yet the Troika have the "guns" to keep it in survival mode and suppress the official line for as long as they need. Banksters, fraudsters, counterfeiters and thieves...choose a noun..any one or all...or add one if you like.

    Game is up.

    I am somewhat disappointed in this analysis, not only have you chosen to draw your support and basis from a third party, but moreover you have not been timely or ahead of the curve.

    Being informed is having the advantage. I agree with your call notwithstanding the untimeliness. I am happy that you concur with my earlier call.

    BTW..March 20 bond payment is already catered for under the ~136bln package. It will sit in an escrow account to specifically meet the bond payments. The deal will be done and the sovereigns and banks will get their money. It doesnt help Greece......but it was never meant to.

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  25. The ole boys will keep buying time until the market wakes up to the dollar's true role, that of a real-time measure for real-time gold-money in a real-time gold-money paradigm. This must be implemented , bottom-up, by the market (and is as we speak) for the sake of organic rate of change and cannot be a top-down implementation for legitimate fear of a sudden dollar collapse. A sudden dollar collapse isn't good for anyone. Rate of change is critical. The dollar's role , as a currency, has been but a stop-gap measure in history. It's newer role as gold's measuring servant(now that it floats) was a critical need in the whole spirit of trading real wealth for real wealth. Real-time is where it's at !

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  26. Greece is the worst of all the Euro nations. They cannot even collect money on electric bills because the people are so greedy and want something for nothing. Sure the bankers are scum and ruthless, but the people of Greece have been stilling from there own nation for decades. NOBODY pays taxes in Greece. Greeks have sucked every penny from the nation and now they are upset the gravy train has stopped.

    ReplyDelete
    Replies
    1. you are either a liar or an idiot.

      Delete
  27. Really informative article - Regardless of what's happened and is going to happen, I do love going to Greece.

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  28. You want ahead of the curve Liquid??

    www.veteranstoday.com/2012/02/21/intel-exclusive-trillion-dollar-terror-exposed/

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    Replies
    1. What's that I read......
      Banks counterfeiting and being supposedly part of a criminal enterprise....hmmmmm...now that sort of news is going to affect markets. When's the next express train leaving to HELL ?? Lets make sure they are all on it..huh !!

      Delete
  29. Greece will default because it is the best outcome for everybody.

    a) The complicated 'deal' is to give the appearance of doing everything to help Greece to avoid a default. So that when it does default, the politics will be 'right'. Also, a large chunk of the bailout money actually goes back to the creditors, thus help in creating a firewall.

    b) Greece will return to the drachma and get a chance to show if it can fix itself with its own currency. If so, trust may return over (long) time and invitation to rejoin Euro. If not, well...

    c) A Greece default will trigger CDS events. Hopefully, a lot of players involved will get burned, lose their shirts, and may even cause some kind of Lehman crisis. This will give the EU the political cover to step in and bust up CDS market in the EU.

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  30. i understand a prediction, i dont understand the fearless character of it.

    you are pushing too much in order to appear certain in a crazy world.

    i hope you dont bet your money the same way.

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  31. Great prediction. There has to be a raid on what little scraps are left of Greece to "recoup losses" and a mass movement of people across borders.

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  32. This is an opportunity for Greece to do something historically major - they can make a clean break with the interest type banking systems that always becomes unstable and then fails.

    They could start a central bank that makes no interest loans. The Japanese have more or less been doing this for the last 20 years - they have one of the strongest currencies in the world - in fact they have to devalue their currency so that their products do not become too expensive to export. There are modern Muslim no interest banking systems that function well and are beginning to promote growth and wealth.

    If Greece were to go to a no interest banking system they would become the most stable economy in Europe - while the rest of Europe is on the verge of major inflation, they will be stable. If Greece can stay away for Israeli interests, they will have many natural trading partners with the new emerging Arab economies. (Of course this goes for all the European Mediterranean economies.)

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  33. Fish are being shot in a barrel.

    The fish die.

    Those doing the shooting and those observing the proceedings condemn the fish for their inability to swim.

    That is what we have.

    A wise man once said, "Let justice roll down as waters, and righteousness as a mighty stream." If karma really is a bitch the shooters and those who stand by and allow all this to happen are in for one hell of a payback.

    K Smith

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  34. K Smith ... well said.

    PeteCA

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  35. A default by Greece may indeed be the best thing for the Greeks. It would suxors for the bankers though.

    I don't think that it would impact the EU as much as the continuous bailouts would.

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  36. @K Smith,

    Yes, indeed, that's what's happening.

    Unna

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  37. Here in the USSA I have been hearing about the Hopium Administration has told the MSM to pump the hopium big time,
    and that was a year ago and now just like clockwork the male and female bimbos that cover for real journalists are selling 24/7 the economy is getting better, meanwhile in a rather good area of LA I saw a bunch of lease, out of business signs, and a bank closed just coming to town on the hugely trying Shame Train, the Metro LA to be exact.
    Five homeless new by the 7/11 you get the drift.

    So the question I ask is the Treasuries are manipulated via the dealers, so exactly does this screw the manipulation or can Tim pull off an acid house trick? I hear shit blows over here in the near future but when the storm I don't know when.

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  38. GL: does the forced restructuring of bonds, invocation of CAC for uncooperative bondholders, credit event determination by Captian Obvious, and triggering of Greek CDSs mean they beat your predicted default date, or in your view is March 20 still a'coming, and this was just a shot across the bow?

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  39. This comment has been removed by the author.

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  40. gonzalito

    i said it before. what did you want the 'fearless' in the prediction? doesn't matter old boy. maybe try another date?

    ReplyDelete
  41. Andthen there is this;Moody's: Greece has defaulted.

    http://rt.com/news/moody-s-greece-default-debt-241/

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  42. It's March 20 and Greece hasn't defaulted... what next?

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  43. Gonzalito

    It's March 20 and guess what happened today


    Greece receives first tranche of new bailout aid
    http://www.reuters.com/article/2012/03/20/us-greece-payment-idUSBRE82J0GQ20120320

    xxx

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  44. Fearless prediction - Gonzalo Lira fails again!

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  45. I'm glad I didn't spend $300 on Lira's Strategic Planning Group subscription

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  46. please stop playing chicken little what will be will be,all they have to do is ask the usa for money and the suckers that we are on account of dumb ass obama or pecker head and he will print out another 50 billion dollars.

    ReplyDelete
  47. You don't like change. Glass Windows 7 Anytime Upgrade Key does not have the particular familiar Start off switch regarding launching programs and concluding the machine straight down. Of course, it isn't really difficult to kick off your own apps from the Start monitor with the Windows Eight tile user interface.

    ReplyDelete

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