Monday, 20 February 2012

European leaders do not trust Greece ...

... to keep their promises, insulting or a taste of reality ?
Confidence in the ability of Greek politicians to keep their promises is so low that eurozone finance ministers are likely to demand that a special protected account be set up to receive funds from the second bailout that they aim to agree today.  (as reported in today's Times).
In a sign of the lack of confidence in that leadership, some eurozone ministers will push today for all bailout funds to be safeguarded in an escrow account dedicated to paying off Greek debts. There will be many more conditions to the handout, which comes after a rescue package of €110 billion two years ago, including a team of experts stationed in Athens to monitor austerity measures.
If I were a German taxpayer I would want every transaction from the escrow account on-line with an explanation as to exactly why it was made, although it might be less of a German taxpayer burden if the politicians ate crow and let Greece float like Russia did after its default.

1 comment:

  1. Perhaps I am just a big softie but I am beginning to feel a little sorry for the Greeks.

    The German economy is booming and the Greeks, locked into the Euro as they are, are being dragged ever further down the road to ruin.

    There is absolutely no hope that the Greek economy will ever be able to recover enough to match up to Germany, so they are forced into an ever increasing spiral of austerity and job losses. Serious poverty looms.

    They need a 30% devaluation. As long as they stay in the Euro, the longer the pain will last.