Tuesday, July 2, 2013

Greece back in the Troika crosshairs - given three days or else to bow down to the latest demands ! Spain credit contraction exceeds 6 percent - worst during ongoing crisis - where are the green shoots ? Italy's Coalition showing more cracks as Monti threatens to pull out !

Greece news .....


http://www.zerohedge.com/news/2013-07-02/stocks-euro-slide-merkel-warning-greek-bailout-cash-may-be-delayed

Stocks, Euro Slide On Merkel Warning Greek Bailout Cash May Be Delayed

Tyler Durden's picture
Submitted by Tyler Durden on 07/02/2013 12:24 -0400




It appears the market is in sell-first, question-later mode as a series of confusing headlines just hit from Bloomberg, citing a Merkel interview from SDZ, in which the German leader appears to have said that Greece May and/or May not get the next Troika bailout package...
  • *GREECE MAY NOT GET NEXT EU8.1B AS PLANNED, MERKEL TELLS SZ
  • *GREECE MAY GET NEXT EU8.1B IN TRANCHES, MERKEL TELLS SZ
  • *MERKEL SEES NO ADDITIONAL DEBT CUT FOR GREECE: SUEDDEUTSCHE Z
As we noted here, the IMF has already warned on non-payment (and a 3-day ultimatum has been set) and with the election so close, it seems Frau Merkel is between a populist rock (keeping the leash tight and explaining that they may not get the full amount but may get a tranched amount based on smaller performance hurdles) and a hard place (of saying nein and losing Europe).


http://ekathimerini.com/4dcgi/_w_articles_wsite1_1_02/07/2013_507082


Troika said to be unconvinced by ERT layoffs

 Administrative Reform Minister Kyriakos Mitsotakis faces the tough task of convincing troika officials on civil service layoffs
Troika envoys reportedly remained unconvinced on Tuesday about whether the dismissal of some 2,600 employees of the state broadcaster ERT, which was closed last month, should be counted as layoffs in the civil service following a pledge by Prime Minister Antonis Samaras to rehire 2,000 of the workers on short-term contracts.

“The opinion of troika representatives is that the number of layoffs will be clear when the number of rehires are finalized,” a source at the Administrative Reform Ministry told Kathimerini after talks between Minister Kyriakos Mitsotakis and the foreign envoys.

The inspectors reportedly asked for more details about the transitional broadcast service planned by the government and when this would be replaced by a new broadcaster. Mitsotakis had planned to highlight the ERT dismissals as signs of progress in government pledges for public sector layoffs in a bid to secure an extension for the induction of 12,500 civil servants into a so-called mobility scheme where they would receive reduced wages for a year ahead of a status review.

Irrespective of whether or not the ERT staff are counted in the 4,000 layoffs the government must carry out by the end of the year, a significant proportion of the dismissals are expected to come from the education sector.

Senior officials at the Education Ministry have indicated that the sector has already contributed to the austerity drive, hiring only 2,000 auxiliary teachers for this year, compared to 12,000 last year.

http://www.guardian.co.uk/world/feedarticle/10866080


ATHENS, Greece (AP) — A Greek minister in charge of reforming the country's bloated public sector says he will need "several months" to overcome delays in a staff restructuring program demanded by rescue creditors.
Kyriakos Mitsotakis, appointed in a cabinet reshuffle last week, made the remarks late Tuesday after meetings with the "troika" of debt inspectors from the European Union, European Central Bank and International Monetary Fund.
The government has failed to sign up any public sector employees to a new mobility scheme — which includes involuntary staff transfers — that should have included 15,000 people by the end of 2012.
The troika officials are in Athens to approve bailout loan payouts worth 8.1 billion euros ($10.6 billion).


http://www.zerohedge.com/news/2013-07-02/greece-gets-three-day-ultimatum-europe-fix-itself-or-else



Greece Gets Three-Day Ultimatum From Europe To Fix Itself, Or Else



Tyler Durden's picture
Submitted by Tyler Durden on 07/02/2013 07:08 -0400


Yesterday it was the Egyptian military giving president Morsi a two day ultimatum before things "deteriorate", now it is the Eurozone giving Greece a three day ultimatum to "deliver on the conditions attached to its international bailout in order to receive the next tranche of aid" or else.
 This links back to the FT report from June 20 that the IMF told Greece it has until the end of July to plug its budget holes, or else. In other words, simple escalation. Of course, maybe it should have been made apparent to Greece back in May 2010 at the time of the first (of many) bailouts that all those tens of billions in sunk costs are actually supposed to lead to economic reforms instead of perpetuating a broken and corrupt political system in which all in efficiencies and failures are blamed on evil (f)austerity.
From Reuters:
Greece has three days to reassure Europe and the International Monetary Fund it can deliver on conditions attached to its international bailout in order to receive the next tranche of aid, four euro zone officials said on Tuesday.

The lenders are unhappy with progress Greece has made towards reforming its public sector, a senior euro zone official involved in the negotiations said, while another said they might suspend an inspection visit they resumed on Monday.

Athens, which has about 2.2 billion euros of bonds to redeem in August, needs the talks to conclude successfully. If they fail, the International Monetary Fund might have to withdraw from the 240-billion-euro bailout to avoid violating its own rules, which require a borrower to be financed a year ahead.

That would heighten the risk that concerted efforts by policymakers over the past nine months to keep a lid on the euro zone crisis could unravel, at a time when tensions are rising in other countries on the region's periphery.

Portugal's Finance Minister Vitor Gaspar, the architect of its austerity drive under an EU/IMF bailout, resigned on Monday in a potential blow to his country's planned exit from an EU-IMF rescue program.

Political tension has also increased in Italy, where Prime Minister Enrico Letta called a government meeting after a coalition partner threatened to withdraw.

Athens and its creditors resumed talks on Monday to unlock 8.1 billion euros ($10.6 billion) of rescue loans, after a two-week break during which the government almost collapsed over redundancies at state broadcaster ERT.

"All agreed that Greece has to deliver (pledges) before the Eurogroup on Monday. That's why they must present again on Friday," a second source told Reuters.

Euro zone finance ministers are scheduled to meet on July 8 and discuss the situation in Greece, which is in its sixth year of recession and has seen unemployment surge to record highs.
It almost appears as if the Troika is actually set on being serious this time:
"It is a very difficult negotiation," a senior Greek official participating in the talks said. "We're moving fast to wrap up as many issues as possible a soon as possible."

But Greece's financial overseers - the IMF, the euro zone and the European Central Bank - were unlikely to be able to conclude their review in July and might need to suspend the visit and resume it in September, a senior euro zone official said on condition of anonymity.

Representatives of the EU-IMF-ECB "troika" have been holding serial meetings with government ministers in Athens, struggling to agree on a host of outstanding issues.

If talks are not concluded by the middle of month, Athens risked missing the installment, the Greek official added.

Athens has missed a June deadline to place 12,500 state workers into a "mobility scheme", under which they are transferred or dismissed within a year.
If indeed the Troika is set on purging Greece, it can only mean one thing: Cyprus part 2, and this time it will be Greek depositors who are to be impaired (since there is no more deleveraging that can be executed in the sovereign realm, either via a PSI or OSI). And with the Cyprus bail-in failing to lead to epic chaos and a financial collapse, the Troika's confidence appears raised that what worked in Cyprus can work just as well in Greece, as the depositor confiscation "template" moves one step ever closer to its ultimate goals: Spain and, finally, Italy.
If we were Greek depositors, we would make prudent use of the 'mattress alternative' right about now...









http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_02/07/2013_506968



EU denies reports of troika ultimatum to Greece [UPDATE]

 Health Minister hails 'total agreement' with foreign inspectors

The European Commission has denied reports that the so-called troika has given Greece a three-day deadline to assure foreign lenders it can meet the terms of its bailout deal before it can receive the next tranche of aid.

Speaking to journalists in Brussels on Tuesday, Commission spokesman Simon O'Connor rebuffed a report by Reuters earlier on Tuesday as making “something out of nothing.”

Unnamed euro area officials involved in negotiations reportedly told Reuters that there is “a general dissatisfaction with progress in Greece when it comes to reforming its public sector, such as tax and custom collection or health care services.”

“All agreed that Greece has to deliver before the Eurogroup on Monday. That's why they must present again on Friday,” the news agency quoted a second source as saying.
Greek government officials resumed tough negotiations with troika envoys on Monday.

Emerging from a meeting with foreign inspectors on Tuesday, Health Minister Adonis Georgiadis said the two sides had reached “total agreement.”

“[The ministry] raised the issue that there can be no further cuts in health spending,” Georgiadis said adding however that more reforms were on the way.

Exclusive: Greece has three days to deliver or face consequences - EU officials

Reuters – 1 hour 7 minutes ago
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