International News
See other International News Articles
Title: Greece Will Close Banks to Stem Flood of Withdrawals
Source:
NewYorkTimes.com
URL Source: http://www.nytimes.com/2015/06/29/b ... uropean-central-bank.html?_r=0
Published: Jun 28, 2015
Author: LANDON THOMAS Jr. and NIKI KITSANTONISJU
Post Date: 2015-06-28 14:49:54 by buckeroo
Keywords: None
Views: 907
Comments: 4
The government’s decision to close banks temporarily and impose other so-called capital controls came hours after the European Central Bank said it would not expand an emergency loan program that has been propping up Greek banks in recent weeks while the government was trying to reach a new debt deal with international creditors. Mr. Tsipras said on Sunday night that the European Central Bank’s decision was an attempt to “blackmail’’ Greece. The debt negotiations broke down over the weekend after Mr. Tsipras said he would let the Greek people decide whether to accept the creditors’ latest offer. That referendum vote is to be held next Sunday, after the current bailout program will have expired. But in that case, the Cypriot government acted in concert with other European governments as part of a new bailout program. In Greece, the emergency banking measures were be a result of a breakdown in talks with other eurozone countries. The breakdown has intensified pressure on cash-poor banks as jittery Greeks withdraw their savings. There is still a chance that Greece and its creditors — the European Central Bank, the International Monetary Fund and the other eurozone countries — can come to terms before its current bailout program expires on Tuesday. On Sunday, the European Commission and I.M.F. issued statements indicating the door to further discussions might still be ajar. And in Washington, the White House issued a statement saying that President Obama and the Chancellor Angela Merkel of Germany had spoken by phone Sunday. “The two leaders agreed that it was critically important to make every effort to return to a path that will allow Greece to resume reforms and growth within the eurozone,’’ the White House statement said. But the European Central Bank, for its part, declined on Sunday to raise the limit on its emergency funding for Greek banks — a level currently said by banking officials and analysts to be around 89 billion euros, or about $100 billion — even though businesses and consumers have withdrawn billions of euros in recent weeks. That rate of withdrawals appeared to increase over the weekend, as long lines formed at A.T.M.s around the country, threatening a bank run that the Greek government could try to avoid by imposing capital controls. But at the same time, the European Central Bank did not cut off support entirely, giving the Greek government some extra flexibility in the coming days. Greece’s own central banker, Yannis Stournaras, said in a statement after the European Central Bank decision on Sunday that the Greek central bank would “take all measures necessary to ensure financial stability for Greek citizens in these difficult circumstances.” Before negotiations broke off on Saturday between Athens and its creditors, the Tsipras government had been hoping to reach terms that would free up a €7.2 billion allotment of bailout money that the country needs to meet its short-term debt obligations. Because European officials said on Saturday that Greece’s €240 billion bailout program would not be extended, the big question had been whether the central bank’s president, Mario Draghi, would continue financing the country’s depleted banks. Guidelines of the European Central Bank dictate that it can keep supporting troubled banks as long as there is a possibility that the country in question will come to terms with its creditors on a bailout — as was the case with Cyprus. If Athens and its creditors do not resume talks before Tuesday, the promise of European support for Greece may no longer be on the table. But the European Commission, the executive arm of the European Union and a key broker in the debt talks, seemed on Sunday to reach out to the Greek people, unexpectedly publishing the offer made to Greece before Mr. Tsipras ended the negotiations and announced a national referendum. December 2009 Credit ratings agencies downgrade Greece on fears that it could default on its debt. May 2010 Europe and Greece reach a $146 billion rescue package, conditional on austerity measures. Some economists say the required cuts could kill the patient. January 2015 Greek voters choose an anti-austerity party. Alexis Tsipras becomes prime minister. May 2015 Greece quells fears of an imminent default, authorizing a big loan payment to the I.M.F. June 2015 Greece defers a series of debt payments until the end of the month. The publication was designed to show the lengths to which the creditors, including the I.M.F. and the European Central Bank, had gone to satisfy Athens’s demands for a deal that avoided hurting ordinary Greeks, said one European Union official with direct knowledge of the decision to publish the offer. The official spoke on the condition of anonymity because the institutions had not ruled out a resumption of talks with Mr. Tsipras on the sensitive issue of extending the bailout. “This is a last bridge we are building for them,” said the official. The goal of publishing the document was also to pressure “Mr. Tsipras to change course and choose to mount a ‘yes’ campaign” in the upcoming referendum, the official said. The official acknowledged there was a slim chance that Mr. Tsipras would accede to the terms so soon after abandoning the negotiations. But if Mr. Tsipras did change course, that could lead to a meeting of leaders of the eurozone member states on Monday night to try one more time to reach a deal before the expiration of the bailout. On Saturday, amid intense discussions between Greece and its creditors, officials representing the I.M.F., to which Greece owes €1.6 billion on Tuesday, were trying to persuade European leaders and Mr. Draghi to keep the bank emergency assistance flowing. And on Sunday, the head of the I.M.F., Christine Lagarde, waved an olive branch toward Greece. In a statement, Ms. Lagarde expressed her “disappointment’’ in the “inconclusive outcome of recent discussions on Greece in Brussels.’’ It makes sense the USA, which is an almost lifeless corpse on a stainless steel gurney itself, is pouring a wealth of sympathy on another derelict government. Greece will keep its banks and stock market closed on Monday and place restrictions on the withdrawal and transfer of money, Prime Minister Alexis Tsipras said in a televised address on Sunday night, as Athens tries to avert a financial collapse.
Timeline: Greek Debt Crisis
And in Washington, the White House issued a statement saying that President Obama and the Chancellor Angela Merkel of Germany had spoken by phone Sunday. “The two leaders agreed that it was critically important to make every effort to return to a path that will allow Greece to resume reforms and growth within the eurozone,’’ the White House statement said.
Post Comment Private Reply Ignore Thread
Top • Page Up • Full Thread • Page Down • Bottom/Latest
#1. To: buckeroo (#0)
Is this going to happen in the USA ? Si vis pacem, para bellum
Of course not. We have a Federal Reserve who can add, or remove, federal reserve notes to our money supply as needed. We'll be fine, mortgage the house and call your stock broker. The Patriot Militia, Inc.
Just a word to the wise. You might want to change your "selfie". Remove that Confederate Flag. If you keep that up, you very well might get paid a visit by a SWAT Team. Si vis pacem, para bellum
" Greece Will Close Banks to Stem Flood of Withdrawals "
#2. To: Stoner (#1)
Is this going to happen in the USA ?
#3. To: Percy Misanthrope (#2)
#4. To: Percy Misanthrope, Stoner (#2)
We have a Federal Reserve who can add, or remove, federal reserve notes to our money supply as needed. We'll be fine, mortgage the house and call your stock broker.
“Truth is treason in the empire of lies.” - Ron Paul
Americans who have no experience with, or knowledge of, tyranny believe that only terrorists will experience the unchecked power of the state. They will believe this until it happens to them, or their children, or their friends.
Paul Craig Roberts
Top • Page Up • Full Thread • Page Down • Bottom/Latest
[Home] [Headlines] [Latest Articles] [Latest Comments] [Post] [Mail] [Sign-in] [Setup] [Help] [Register]