Monday, 6 July 2015
1. There is only around €500 million of cash in Greek banks and even with allowances of €60 euros per person that is only 1 days supply left.
2. The ECB is not a political unit and Draghi hates being seen as partisan so it will not do anything ahead of agreement by the EU leaders.
3. The EU leaders are not meeting until tomorrow - so good luck in Greece trying to live for at least 48 hours with no money.
4. The IMF loans are sub-ordinate to the EU ones and the Greeks have defaulted anyway.
Basically, by the middle of this week Greece will have no money left, let alone trying to pay €3.5 billion in a couple of weeks time to the EU.
So, even if the Euro leaders try hard - which initial reactions suggest they are not minded too anyway, the chances are that Greece will have to issue its own scrip sometime this week in order to keep any semblance of the economy going. Medicines and food are running low with the Banks shut - the Country maybe struggling but ordinary Greeks can afford to buy goods - it is the EU via the ECB that is creating an artificial shortage.
As I have maintained for years, the sooner they do this, bite the bullet of a hefty devaluation and get on with it the better - The Country will be a much better place in 3 years, versus the 7 years of disaster that have accompanied trying to pay the debts.
As for the Eurozone, ECB and all that - there is nothing positive to be said at all. The actions to create the crisis in Greece are sickening, the lack of vision and judgement to design an easy path to exit or a parallel 'soft euro' for Italy, Spain and Portugal too is pathetic. The UK can also see clearly where attempts to negotiate or change the will of Germany get you - nowhere and worse.
The sooner we can leave the better, when is that Referendum?