Greek Cabinet Approves 2nd Loan Pact: Official

[Roland99]

http://www.bloomberg.com/news/2012-02-10/papademos-wins-cabinet-approval-for-budget-steps-to-secure-second-bailout.html

Greek Prime Minister Lucas Papademos obtained approval from his Cabinet for deeper budget cuts needed to secure a second package of international aid, clearing the latest hurdle in his race to prevent financial collapse.

Cabinet approved the 287-page document unanimously, said a government official, who declined to be named. The approval means the 300-seat Parliament will vote, probably tomorrow, on budget measures amounting to 7 percent of gross domestic product over the next three years and a debt swap to slice 100 billion euros off more than 200 billion euros of privately-held debt.

“The social cost this program implies will be limited compared to the economic and social catastrophe that would follow if we don’t adopt it,” Papademos told his ministers earlier, according to an e-mailed transcript of his comments. “The completion of the program and financial support will cement our country’s future in the euro area.”

The approval capped a week of tension in Athens as European Union and International Monetary Fund officials argued with Greek government officials over the conditions required to secure the 130 billion-euro ($172 billion) rescue package. Papademos reached agreement with the three party leaders supporting his interim government hours before a crucial meeting of euro area finance ministers in Brussels on Feb. 9, only to be told the measures needed more work.

EURUSD going vertical.

[DCBob]

1. "The approval means the 300-seat Parliament will vote, probably tomorrow"

Not sure that is a done deal.

[denem]

2. Only one party, the 'far right' Popular Orthodox Rally

has rejected the unity government proposals. They have 15 members in the Parliament. Over the course of a month about 6 politicians of the other parties have resigned from Parliament, rather than vote for the Bill, including two senior deputies this week.

So, leaving aside Rummy's 'unknown unknowns' it should pass with little (numerical) drama. I don't imagine a mainstream representative would choose to remain in Parliament and side with the Fascists.

[DCBob]

3. Yeah, I read that too but there is tremendous political pressure from all sides.

that could impact the vote. But I agree its likely to pass. They know time is running out.

[denem]

7. "We must all hang together, or most assuredly we shall all hang separately."

They've got to do it as one. Each defection sharpens the cross hairs on the remaining party members.

BTW I do not agree at all with large swathes of this imposed economic policy. You have the economy contracting at 5% per year, 21% unemployment, and a major plank is cutting the minimum wage by 22%. This is pure neoclassical or pure revenge anti-economics, depending on your perspective. A cut in the minimum wage, cuts consumption by the same amount, and will multiply up to a further reduction in GDP.

[DCBob]

8. I agree the austerity stuff will do more harm than good.

It seems it more like punishment than economics.

[denem]

10. And it does so much to promote the 'never again' European Ideal.

Greek Trade Unionists are (reportedly) carrying around (again) placards like this.

[unkachuck]

12. Long live those Greek Trade Unionists!....n/t

[Harmony Blue]

11. The problem is once the first wave of austerity was in place it was only a matter of time

several more waves would come as a result. Unfortunately this is not surprising.

There are rumors swirling that if more austerity cuts actually are proposed in the coming months the military would intervene. Ironically it is because of military spending that Greece is in trouble fiscally. Tax evasion exacerbates the problem with revenue generation, but that is a drop in bucket in terms of total revenue compared to military spending.

[dipsydoodle]

5. tommorow

means Sunday in this case.

[dipsydoodle]

4. Thats only the draft

.

[denem]

9. It's the draft bill unless the EU/IMF want more cuts.

Then they want to see the legislation implemented, the sackings, the reduction in wages, the pension cuts etc etc. Only when there's blood on the floor will they start to release their billions of pieces of silver.

[stockholmer]

6. I truly smell a Greek spring a-burning in near term event horizon

[dipsydoodle]

13. Greece crisis reaches boiling point as Athens asks if it can stay in the euro

Greece is facing an acute political and social crisis this weekend as the bankrupt state prepares to decide whether it can stay in the single currency.

As riot police clashed with protesters on the streets of Athens, and five ministers resigned in protest at the scale of the spending cuts demanded in return for a new €130bn (£108bn) bailout, Evangelos Venizelos, the Greek finance minister and socialist leader, said the country had until Sunday to choose whether to swallow the eurozone medicine of more cuts – or default on its debt next month and be forced out of the euro.

In an emotional speech he said: "The choice we face is one of sacrifice or even greater sacrifice – on a scale that cannot be compared. Our country, our homeland, our society has to think and make a definitive, strategic decision. If we see the salvation and future of the country in the euro area, in Europe, we have to do whatever we have to do to get the programme approved."

Police ringed the Greek parliament building following the failure of eurozone finance ministers to approve the new bailout for Greece. Prime minister Lucas Papademos had offered new austerity measures worth €3.3bn to secure the euro lifeline, but he was told the cash would not be forthcoming until savings of an additional €325m were identified. He was told to get the €3.3bn programme endorsed and come up with a plan for the new cuts – to plug a gap in this year's budget – by Sunday.

http://www.guardian.co.uk/world/2012/feb/10/greece-crisis-bailout-euro-default

[Roland99]

14. God Save the Central Bankers!

[Katashi_itto]

15. There will always be more bail outs needed. All this money simply goes straight to the banks.

Greece, as soon the rest of us are entering a Black Hole of compounded interest.

Not to mention, despite all this remember Greece is buying weapons still. However the Greek govt is being told what to do. Guess you they are buying weapons from....Germany.

So hospitals are doing without bandages and such. Pensioners are beginning to starve. German defense has a captive buyer of their weapons.

What a great scam!