Tricky sums for the Euro Group on second Greek Bailout tomorrow.
Austria's Finance Minister, Maria Fekter, as if she were explaining complicated physics for a kindergarten, has put it all very simply this afternoon, when asked if Greece will get its deal, according to Reuters, linked here, replied:
It is hugely complex and probably impossible to know where all the eventual liabilities might end, so let us assume the ESM is the present intention of the parties as to how any extra obligations for Greece, taken this coming week might land. (After all that agreement was supposedly only signed this month, that version is linked here).
Austria holds 194,838 shares out of 7,000,000 in this ESM disaster, which represents a mere 2.77%. Nevertheless if the reported figure now required by Greece is truly around the €145 Billion level, that is still "lots and lots" of beer money (€4 Billion) for your average Austrian. Of course mere peanuts when considering that France, already having lost one of its three A's as a result of this Euro fiasco, holds 1,427,013 shares of the total 7,000,000, almost eight times Austria's share, ( ie a whopping €29.6 Billion), making the wine drinking typical Frenchman potentially liable for crates worth of St Emilion or Gevrey Chambertin, depending upon whether his taste once was for Claret or for Burgundy!
Of course the good news all round, following dinner in Berlin on Friday of last week, is that President Sarkozy's ex-Finance Minister, who was in on the deal that began this merry go round, Mme Christine Lagarde, in her new job as MD of the IMF might chip in 10% on behalf of the rest of the world, bringing the costs to Austria to only €3.25 Billion and €23.9 Billion for the French, this calculation also assuming the money committed can be kept at the original estimate of €130 Billion.
How long can electorates be expected to believe that none of this money will ever fall due?
An interesting briefing paper from the EU dated last July, when the ESM was first proposed, is linked here, for those in need of an entertaining read and quiet Sunday afternoon chortle!
"I don't think there is a majority to go a different way because a different way is enormously arduous and costs lots and lots of money."A bold statement indeed for a country already on warning that its triple A credit rating is in danger. It appears she believes that Greek Bailout 2.0 does not itself involve huge amounts of cash, or as she quaintly phrases it "lots and lots of money"!
It is hugely complex and probably impossible to know where all the eventual liabilities might end, so let us assume the ESM is the present intention of the parties as to how any extra obligations for Greece, taken this coming week might land. (After all that agreement was supposedly only signed this month, that version is linked here).
Austria holds 194,838 shares out of 7,000,000 in this ESM disaster, which represents a mere 2.77%. Nevertheless if the reported figure now required by Greece is truly around the €145 Billion level, that is still "lots and lots" of beer money (€4 Billion) for your average Austrian. Of course mere peanuts when considering that France, already having lost one of its three A's as a result of this Euro fiasco, holds 1,427,013 shares of the total 7,000,000, almost eight times Austria's share, ( ie a whopping €29.6 Billion), making the wine drinking typical Frenchman potentially liable for crates worth of St Emilion or Gevrey Chambertin, depending upon whether his taste once was for Claret or for Burgundy!
Of course the good news all round, following dinner in Berlin on Friday of last week, is that President Sarkozy's ex-Finance Minister, who was in on the deal that began this merry go round, Mme Christine Lagarde, in her new job as MD of the IMF might chip in 10% on behalf of the rest of the world, bringing the costs to Austria to only €3.25 Billion and €23.9 Billion for the French, this calculation also assuming the money committed can be kept at the original estimate of €130 Billion.
How long can electorates be expected to believe that none of this money will ever fall due?
An interesting briefing paper from the EU dated last July, when the ESM was first proposed, is linked here, for those in need of an entertaining read and quiet Sunday afternoon chortle!
Labels: ESM, Greek Bailout 2.0
posted by Martin at 2:36 PM
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