Monthly Archives: July 2011

A Comparison with the USA

The Greek and American economies (and their respective problems) have very much in common. First, however, the differences. America has the largest economy of the world (and Greece does not). While that is only a soft fact, it is an … Continue reading

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Participation of Private Banks

The details of the deal can be summarized as follows: Banks can swap half of their junk-rated Greek assets 1:1 into AAA-rated 30-year assets with a fixed interest rate of 4,5% (the interest, however, remains “Greek risk”). They can do … Continue reading

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Was is a good deal?

The Prime Minister needs to be congratulated on his public performance at EU levels during the last months. Until Merkel/Sarkozy finally sat down last Wednesday to do some serious business (note that there was no leak after their meeting!), it … Continue reading

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After today’s decision by EU-elites

Let’s see what possible alternatives there are: Debt forgiveness: hopefully not!Result: no debt was forgiven. A new bank tax: hopefully not!Result: there will be no bank tax. More money like in the past: hopefully not!Result: there will be more money. … Continue reading

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Before today’s decision by EU-Elites

Let’s see what possible alternatives there are: Debt forgiveness: hopefully not! A new bank tax: hopefully not! More money like in the past: hopefully not! A complex financial scheme to convert bad paper into good paper: hopefully not! Private sector … Continue reading

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Bill Rhodes on Europeans

William R. (“Bill”) Rhodes is probably the world’s most competent expert on sovereign debt reschudulings. In a recent interview with The Economist he said the following: “One of the things: you’ve got to have the Europeans speak with one voice. … Continue reading

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On Debt Reschedulings

The major difference between Greece’s debt today and Argentina’s in the 1980s is that Argentina’s debt then was mostly bank loans (about 500 banks worldwide) whereas Greece’s debt is mostly public bonds. When debt takes the form of bank loans, … Continue reading

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