Pablo Iglesias: If the Greek olive branch is rejected, Europe may fall

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Pablo Iglesias, leader of Spain's Podemos party

During his swearing-in speech as Greece’s prime minister, Alexis Tsipras was clear: “Our aim is to achieve a solution that is mutually beneficial for both Greece and our partners. Greece wants to pay its debt.”

The European Central Bank’s (ECB) response to the Greek government’s desire to be conciliatory and responsible, was also very clear: negative. Either the Greek government abandons the programme on which it was elected, and continues to do the very thing that has been disastrous for Greece, or the ECB will stop supporting Greek debt.

The ECB’s calculation is not only arrogant, it is incoherent. The same central bank that recognised its mistakes a few weeks ago and began to buy government debt is now denying financing to the very states that have been arguing for years that the role of a central bank should be to back up governments in protecting their citizens rather than to rescue the financial bodies that caused the crisis.

Now, instead of acknowledging that Greece deserves at least the same treatment as any other EU member state, the ECB has decided to shoot the messenger. Excesses of arrogance and political short-sightedness cost dear. The new despots who are trying to persuade us that Europe’s problem is Greece are putting the European project itself at risk.

http://www.theguardian.com/commentisfree/2015/feb/11/pablo-iglesias-greek-europe-greece-alexis-tsipras

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1. Greece Eurogroup meeting: Finance Minister Yanis Varoufakis lists four key principles for renegotiat

Today, Greece's finance minister met with leaders from the Eurozone's other member states to discuss a renegotiation of its bailout package.

Yanis Varoufakis is part of the radical left party Syriza, which won a parliamentary vote on 25 January on the back of its promise to bring the country out of austerity. It said it would do this by changing its €240bn bailout agreement with the European Union, International Monetary Fund and European Central Bank.

But initial talks with Eurozone leaders did not prove successful – German finance minister Wolfgang Schaeuble said that if Greece was not willing to request an extension of its 240 billion euro bailout, then “that's it”. He said debt write off or further assistance, such as a bridge loan, were not options.

However, leaders were keen to hear Varoufakis's proposals, which led to today's eurogroup meeting taking place in Brussels. Varoufakis was accompanied by Deputy Prime Minister Yanis Dragasakis, rather than Prime Minister Alexis Tsipras.

http://www.cityam.com/209226/greece-eurogroup-meeting-finance-minister-yanis-varoufakis-lists-four-key-principles

[DetlefK]

2. THE ECB IS NOT ALLOWED TO GIVE LOANS TO COUNTRIES PER ITS FOUNDING STATUTES!

Treaty of Maastricht, 1992
http://en.wikipedia.org/wiki/Maastricht_Treaty

http://de.wikipedia.org/wiki/Europ%C3%A4ische_Zentralbank#Institutionelle_Unabh.C3.A4ngigkeit
(here in german; the english wikipedia lacks this info...)



All the ECB can do to support a country, is buying state-issued bonds. And nobody who has his marbles together wants to buy greek bonds right now.

http://www.bloomberg.com/news/articles/2012-09-05/greek-crisis-timeline-from-maastricht-treaty-to-ecb-bond-buying

2009, May 3: The ECB says it will indefinitely accept Greek collateral regardless of the country’s credit rating.

2011, Dec. 9: Leaders complete all-night talks in Brussels on a “fiscal compact,” sparking a split with the U.K. Euro governments add 200 billion euros to their crisis-fighting war chest, tighten rules to curb future debts and speed the start of a 500 billion-euro permanent rescue fund to next year. Draghi welcomes the decisions, without signaling any willingness to step up bond purchases.
Greek 10-year bond yield at 32 percent.
Italian 10-year bond yield at 6.47 percent.
Spanish 10-year bond yield at 5.77 percent.
German 10-year bond yield at 2.07 percent.

2012, Feb. 17: The ECB swaps Greek bonds purchased under the SMP for new ones to ensure it isn’t forced to take losses in a debt restructuring.

2012, Feb. 21: Euro-area finance ministers reached agreement on a second bailout package for Greece. The deal includes a 53.5 percent writedown for investors in Greek bonds.