Best Posts in Thread: The start of the end of the EU!

So unless Greek savers miraculously decide to cease withdrawing cash from their accounts, Greek banks would find themselves in serious straits as soon as Monday - because the banks have become dependent on ELA, approved by the ECB but supplied by the Bank of Greece, to provide the cash to depositors who want their money back.

"We think the Greek government will have no choice but to announce a bank holiday on Monday, pending the introduction of capital controls," said a source.

Capital controls are restrictions on how much customers can withdraw from banks. Until now, the Greek government has been signalling that it does not want to introduce this restriction on the way banks can operate.

The expected decision by the ECB to terminate emergency lending to Greek banks stems from yesterday's decision by the eurogroup of finance ministers that there is no way now of preventing Greece tumbling out of the current bailout programme on Tuesday and also of defaulting on a €1.5bn (£1.1bn) due payment to the IMF on the same day.

Painful episode
So, with Greece no longer participating in a formal rescue programme, it is seen as impossible for the European Central Bank to continue extending credit to Greek banks - because the solvency of the Greek state would be in doubt, and the solvency of banks is so intimately linked to the solvency of the state.

The prospect of banks being forced to close tomorrow, or, if they're not, of a devastating run on them, represents the most painful episode in Greece's financial and economic crisis, since it blew up in 2009.

It is also the greatest perceived threat to the integrity of the eurozone since it was created in 1999.

If the Greek government refuses to shut the banks, the European Central Bank - as regulator of eurozone banks - could recommend that all branches of Greek banks outside Greece be closed to preserve cash.

But since Greek banks could get their hands on cash in branches outside the Greek mainland, closing overseas branches but not Greek branches would be seen as favouring Greek residents over customers in the rest of the world.

ECB to turn off emergency help for Greek banks - BBC News
Greece should never been allowed to enter the EU in the first place along with a few other countries, the debt is so large now they could never pay back the loan.

 

There are many reasons why Greece finds itself in a precarious financial position, one of which is its poor record at collecting tax. But is it really true that in 2010 the government collected only 10% of the tax it was due, asks David Rose

Did Greeks fail to pay 89.5% of taxes? - BBC News

That means that nearly one in four euros that potentially could be taxed in the country's economy simply weren't declared to the authorities, and the Greek government missed out on approximately 28bn euros ($31bn) of additional revenue each year.

And it is looking like they will get another bailout,another waste of EU tax payers money!

 

If they do get another bailout I don't think they will ever pay off the loan and I bet it won't be the last time Greece defaults on a loan.

 

Looks like some interesting times lay ahead for Greece and the EU!

Greek referendum: Alexis Tsipras hails victory for No campaign - live updates | Business | The Guardian

German calls for Grexit mount as EU stunned by ‘No’ vote | News | GMA News Online

 

If the EU give out money that easily,I think I will apply for a loan Anyway the 80 billion should tie them over for the next 12 months! What a load of bollocks.