http://www.zerohedge.com/news/juncker-says-there-plan-b-if-greek-debt-swap-fails

Juncker Says There Is A "Plan B" If Greek Debt Swap Fails

Submitted by Tyler Durden on 03/01/2012 17:52 -0500

Greece

With 9 days left until the end of the Greek exchange offer, many are curious for hints on how the uptake may be proceeding and whether funds have amassed enough of a blocking stake in the Greek bonds (they certainly have it in the UK-law bonds whose exchange offer will take place conveniently in Apil after the Troika's €130 is funded, if at all). Which is why the following statement by Juncker will likely be very closely scrutinized:

JUNCKER SAYS THERE'S `PLAN B' IF GREEK DEBT SWAP FAILS

but

JUNCKER DECLINES TO PROVIDE DETAILS ON BACK-UP PLAN

For those curious what Plan B may be, here's a hint: it's in the box on the lower right.

Joking aside, it is poor rhetorical form to even mention an alternative to what at least in propaganda circles is assumed to be a foregone conclusion. If Juncker feels compelled to bring it up this early in the PSI process, it is merely to provide himself with additional leverage against holdouts who feel like not complying with Venizelos' pleadings of going along with the "very generous exchange offer" and instead hold out for par recoveries in litigation, an outcome which if it derails the PSI would mean the end of the Greek European dream.

As a reminder, today the Eurogroup once again did not come to a conclusion on Greece, instead couching it in more provisions and conditions, the biggest of which is the successful conclusion of the PSI.

So: how long until the leaks of PSI participation start, and if past is prologue, will they be initial bad, i.e., hinting at unsatisfactory acceptance, only to be replaced with good news at the very end in another attempt to ramp the stock market to the Birinyi promised land?

We will find out in the next few days.

and.....

http://hat4uk.wordpress.com/2012/03/01/eurozone-firewall-us-german-sources-explain-berlin-end-march-delay/

EUROZONE FIREWALL: US, GERMAN SOURCES EXPLAIN BERLIN ‘END MARCH’ DELAY

Pondering the Ides of March?

‘Easier to sell Firewall after Greek default’ claim backed by bad Greek economic data

One thing still puzzling a lot of spectators and players across the world is what the logic and/or ploy might be behind Wolfgang Schauble’s odd insistence that he probably will bend on the eurozone firewall issue, just not yet. There’s an air of ‘I’m going to fall in love with, but not for a year or two’ about it.

Either way, things got sillier still this morning when the SudDeutsche website ran a piece about the Firewall – based on ‘information received’ about the Fuhrerine in Berlin. The translation of one key phrase is this: that Merkel has decided ‘…to give up her resistance to a temporary increase of the credit upper limit of 500 billion euros towards nearly 750 billion euros. The final decision is to fall however only at the end of March.’

This suffers from the same Teutonic time-dilation as Schauble’s witterings. I mean, if you want to reassure the markets, why not openly say “Yes, let’s make it 750 billion euros”? Why wait to deliver the good news? Why keep China and Japan – just gagging to give you money – waiting to scribble those cheques any longer? (Hint: there is irony present in that last question)

The answer is, because for some people – Fritz the German voter, Hermann the banker, Otto the FPD member und so weiter – guaranteeing to do this is very bad news indeed. Bad enough, in fact, to get worked up about it.

But if that’s true – and trust me, it is – then why signal your willingness to do it by the end of March at all? Why not just keep schtum?

I may have been handed the answer to this one. And given that it involves corroboration without collusion between an American civil servant and a German banker, I am impressed enough to run with it….especially after reading the SudDeutsche piece….and this afternoon’s Athens News website.

“There is one very big thing that may change between now and the end of March,” a German contact told me yesterday afternoon, “and that is that Greece having to be bailed out may no longer be an issue. If Greece is declared insolvent before then, the bill for a firewall suddenly begins to make a lot more sense to everyone. So it’s a lot more saleable for a politician in trouble”.

Intriguing that one, isn’t it? And what if you know that – barring a major SNAFU – Greece will default during w/c 20th March? Anyway, I put the same question without emphasis or bias to a Washington source last night. He got back to me half an hour ago.

“We hear there are some very bad Greek numbers going to appear,” he began, “and you can be sure the Troika was expecting it. It’s because of this kind of sh*t that the White House wants to amputate…..Greece is a black hole. If the Troika knows, Berlin knows. Let’s be fair here, we all know what’s coming. But if you still have the [bailout] money in escrow…and if the bondholders vote in favour…well, it’s still highly likely that this kind of news could give everyone the excuse to back off, right? I think the only way to explain their [Merkel and Schauble's] statements is that they either expect or know about a Greek default before end March. They’re hedging their bets. If they thought bailout really is a done deal, they wouldn’t need to.”

It works for me. And after some searching around after 16:00 GMT today, this is what I eventually found at Athens News:

‘Manufacturing slump deepens in February’

Manufacturing shrank at its fastest rate in at least thirteen years in February as production and new orders declined at record rates, driving the sector deeper into recession and forcing firms to shed more jobs, a survey showed on Thursday.

The Markit Manufacturing Purchasing Managers’ Index (PMI) for Greece fell to a survey low of 37.7 points in February from 41.0 in January, staying below the 50 mark that divides growth in activity from contraction for each of the past 30 months.

Production and new order volumes fell at the sharpest pace in the near 13 year history of the survey as austerity sapped demand. New export orders fell for a sixth straight month and at the steepest rate since May 2010.

————00000

Listen, none of this is conclusive. How could anything be right now? But it does add up. What it adds up to is a very bleak future indeed for Greece….and an awful lot of people delivered from a very deep hole.

Stay tuned.

and....

http://www.telegraph.co.uk/finance/financialcrisis/9117156/EU-finance-chiefs-give-Greece-58bn-but-stoke-fears-of-default-after-delaying-bail-out-decision.html

By Louise Armitstead, and Bruno Waterfield

11:40PM GMT 01 Mar 2012

7 Comments

Ministers released €58bn (£48bn) of cash designated to smooth the €206bn bond restructuring but withheld the remaining €71.5bn allocated to help the Greek government.

Eurozone finance ministers, who met in Brussels ahead of European Union leaders summit on Thursday night, said they would hold a conference call on Friday, March 9 - a day after the bond swap deadline - and postpone a decision until a eurogroup meeting on Monday, March 12.

The delay will push Greece to within eight days of bankruptcy - a move likely to rattle global markets and put eurozone leaders on a collision course with America and China.

World leaders have demanded immediate action to stem the crisis but Athens faces a €14.5bn bond repayment on March 20.

Jean Claude Juncker, head of the group of 17 finance ministers, said in a statement that a "high participation" in the bond swap and a "positive assessment" of the Greek austerity reforms were "necessary conditions" for the disbursement of the rescue package. He added that ministers would also withhold permission for the eurozone bail-out fund, the European Financial Stability Facility (EFSF), to issue bonds to help Greece until the conditions were met. Dutch Finance Minister Jan Kees De Jager said: "We have to wait for PSI [bond swap] before final conclusions"

Greece's finance minister, Evangelos Venizelos, agreed a raft of commitments with European paymasters designed to "convey a message to the private sector, to the markets and the international community that the official sector supports Greece".

Jose Manuel Barroso, President of the European Commission, said that the leaders did not discuss easing deficit reduction targets within the EU.

Officials in Brussels also insisted that Spain must present a budget based on its 4.4pc target and that there will be no room for discussions on relaxing it until May.

German Chancellor Angela Merkel bowed to G20 demands and signalled her intention to boost the firepower of the EFSF and the European Stability Mechanism (ESM), saying: "In the long run we cannot resist this pressure."

However Mrs Merkel, who is battling stiff domestic opposition to increasing Berlin's exposure to Greece, said the plans would not be discussed until the end of March.

Stockmarkets rose, flushed from the European Central Bank's second liquidity boost unleashed via cheap loans on Wednesday. Spain managed three successful bond auctions at lower costs, though Portugal's yields rose amid fears it could follow Greece.