Monday, April 20, 2015

Greece to Seize Public-Sector Funds: Economic Genius Krugman on the Scene

How totalitarian will the new radical leftist government go to squeeze the country to payoff the banksters? Pretty far.  Greek Prime Minister Alexis Tsipras has ordered local governments to move their funds to the central bank.

With negotiations over bailout aid deadlocked, Tsipras needs the cash for salaries, pensions and a repayment to the International Monetary Fund The order is being questioned by local officials and slammed by the leading opposition party, reports Bloomberg.

According to B, the decree to confiscate reserves now held in commercial banks and transfer them to the central bank could raise about 2 billion euros ($2.15 billion),

“Central government entities are obliged to deposit their cash reserves and transfer their term deposit funds to their accounts at the Bank of Greece,” according to the decree issued today on a government website. The “regulation is submitted due to extremely urgent and unforeseen needs.”

The new funds may be just enough for salaries and a 770 million-euro payment to the IMF due on May 12.

Money confiscations in other areas are feared.

Meanwhile, after visiting Greece and meeting with the Greek president, economic genius Paul Krugman wrote this:
 If Greece can negotiate a halfway reasonable compromise, one that more or less pauses further austerity, it’s hard to see that the risks of exit would be worth it.
The only sound solution is for the Greek government to default, screw the banksters and remove the rigid regulations that exist on commerce in the country, so that Greeks can be freed to get back to business and grow the economy. Not a peep about this from the genius.  

The only reason a Greek exit from the Euro is attractive to some is becasue it provides the opportunity for the Tsipras government to print drachma Mugabe style.

A sound growing economy could grow if  Greece remains part of the eurozone or if it launched a non-inflationary drachma, that is not the problem. The regulations are the problem, Krugman's focus on Greek exit from the euro is interventionist misdirection.



  1. If they think the euro limits their ability for financial profligacy, just imagine what gold would be like.

  2. And what happens if they don't? because frankly they aren't ever going to see that money again if they hand it over.