Greek Prime Minister Alexis Tsipras has pledged pensions and salaries will be paid despite bank cash machines starting to run out of cash.
Displaying a siege mentality, he made a defiant speech to the nation that was aimed more at Eurozone finance ministers and the International Monetary Fund.
He wants to renegotiate Greece’s debt repayments for the bail out of billions of euros and the country is heading to a referendum on whether to impose spending cuts demanded by the foreigners holding the country’s purse strings.
Tsipras would likely want to save face by meeting with those bankrolling Greece, but they refuse to talk before the referendum.
They say every avenue has been discussed and that Tsipras is not someone they can deal with.
Debt worries
The likely outcome of the referendum is the nation will vote against the cuts.
That leaves Tsipras between a rock and a hard place.
He will have to take the result to his Eurozone partners, but they will not renegotiate terms until Greece hands over billions of euros in missed bail out repayments to the IMF.
Dutch Finance Minister Jeroen Dijsselbloem is leading the Eurozone’s denial to shift.
The worry is other countries with bail out cash, such as Cyprus, Portugal, Italy and Spain will see any relaxation of pressure on Greece to pay as a weakness that they can exploit as well.
That would leave Germany and France, the two Eurozone powerhouses, holding billions of pounds of debt to repay on behalf of other nations.
Horse trading
The Greeks want to horse trade another 30 billion euro bail out to underwrite state pensions and public sector wages, but the rest of the Eurozone wants to see the government tighten the belt on spending even further.
And the IMF suggests that even this amount is an underestimate.
Meanwhile speculation is mounting that the government has a plan B to ditch the euro and reintroduce the drachma.
Others have even suggested the government is stockpiling the virtual currency Bitcoin.
Some are also suggesting that Greece will be punished by other Eurozone nations by being allowed to stay in the club, but without a vote on future policies for a specific period.
the greeks will be much better off outside this undemocratic construct [THE EUSSR] they were DRAGGED into this mess with the help of bent advice a la goldman suchs,and loaned money with no collateral a la the EUSSR’S backstop,so let Greece go they will grow well outside the euro straitjacket, but MAYBE,just maybe that is precisely what Brussels is afraid of..