Sunday, February 28, 2010

Merkel: No Greek Bailout

Conflicting reports continue on the state of a bailout for Greece.

This morning, WSJ reported that a bailout plan was in place. We had our doubts and wrote:
This scheme is very shaky and points to the fact that there is no real solution to this problem short of bankruptcy.
Now comes word that German Chancellor Angela Merkel has denied talk of a German rescue plan for Greece.

The Sydney Morning Herald writes:
Greek bond prices rallied this week on a report that Europe's top economy was considering coming to the aid of debt-burdened Greece, as Prime Minister George Papandreou prepares to hold talks with Merkel in Berlin on Friday.

But the German chancellor denied any such plan was in the works, saying "there is absolutely no question of it".

"We have a (European) treaty under which there is no possibility of paying to bail out states in difficulty," Merkel told ARD public television.

Germany has repeatedly denied talk of a bail-out for Greece, further fuelled this week by a meeting between Papandreou and the head of Deutsche Bank....

The chancellor also ruled out providing support to Greece in the form of state guarantees to the banking sector, arguing that it would amount to aid.
If Merkel continues to stick to this position, it is clear that Germany has decided to bailout German banks dangerously exposed to Greek debt, rather than Greece itself. If this is the case, Greece looks like a sinking ship to me.(ViaBusinessInsider)


  1. it was very logical mercel to refuse the greek bailout because germans and scandinavians are the richest people in europe and if they start to help the poor gipsies of the mediterranean sea
    [italians, greeks, spanish]
    they will become poor like them

    the situation is in wrong place
    americans and obama could save the situation proscribing the greek debts [so these money could be afforded for investments]

    greeks made a terrible mistake to ask help from european union
    they should ask assistance from russiam, china and usa
    it contains erotonomicon
    that critrisized european and american colonialism
    that it is unsuitable for ages under the 18

  2. Greece will be rescued, as will be the rest of the PIGS. If they are not rescued they will default and the main part of their debt is from German and european banks. So if the PIGS default the "rich" Europe has a problem. They will be rescued, but in order to be rescued they will be forced to adopt very tight conditions, like they are alredy implementing in Greece.

    So why is Merkel playing arround? Because the germans dont want to pay the rescue. So Merkel is playing arround to disctract the german public opinion who oposes the rescues.

    But, after all the smoke and mirrors, the PIGS will be rescued.