A Greek default and traumatic ejection from the euro moved a step closer last night after eurozone finance ministers cancelled a crucial meeting, accusing Athens of failing to flesh out austerity cuts.

The escalating brinkmanship came as fresh data showed that Greece’s economy contracted by 6.8pc last year and at an accelerating 7pc rate in the last quarter, far worse than expected by the European Union (EU), the European Central Bank (ECB) and the International Monetary Fund (IMF) “troika”.

The country appears to be in a self-feeding downward spiral that is playing havoc with budget targets, leaving Greece with a Sisyphean task of ever deeper cuts.

Premier Lucas Papademos called his cabinet together late last night to find a further €325m (£272m) of fiscal austerity demanded by the troika, likely to be defence cuts and lower salaries.

The coalition parties failed to convince the Eurogroup that they would stick to the deal, and the mood has been poisoned by EU demands for an escrow account to seize Greek budget revenues at source.

Blackened buildings set alight by protesters on Sunday were cordoned off on streets around parliament in Syntagma Square, a vivid reminder to Greece’s politicians that any misjudgment could push the country towards anarchy. Source: (1) Daily Telegraph

The Finnish people are the only smart ones in the whole group.

Since the inception of the EU, Finland is the only country, other than Luxembourg, that hasn’t been pretty consistently running up big debts and deficits. Even Germany, for all the talk about them being an “economic powerhouse”, is in violation of the Euro-zones own rules on debt and deficit, and they have been for most of the past decade.

the Finns have worked their butts off to make sure that their economy remains reasonably stable. As such it’s no surprise that they are the most pissed off at the Greeks, Portuguese and others that they are needing to bailout time and time again.

As for Greece, the *ONLY* solution has always been for them to leave the Euro-zone, default on their Euro-denominated debt and re-issue new Drachma-denominated debt. Then devalue themselves to poverty.

This will end badly. Greecians want to live well on somebody else’s dime and the Germans (dime owners) don’t want to spend the money.

The Greeks are

1. going bankrupt,
2. leaving the Euro,
3. bringing back the drachmae,
4. going to be poor
5. going to be out of debt.

In that order.

The Germans will then have to recapitalize their banks so that they do not collapse. Then their national finances will look a lot like Ireland. I bet that the German tax payer will be asking the wunderkinds that run banks how they could not have seen that Greece could not pay the bills.

Blame the Greeks if you like but for ever debtor their is a lender and if the lender does not do some thinking before handing his capital over he is a fool. Hmm what are the Greeks going to do with this money? Build factories. or farms, or mines, or something that will enable them to pay me back? No? They are going to p1ss it away on holidays and French frigates? Oh ok here is my money.

There are a lot of greedy b@stard bankers that need to lose their jobs at the very least as well as their freedom and fortune.

Oh and one other thing. The euro is a dead man walking. It is only a matter of time.

References:

(1) Daily Telegraph

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