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Tuesday, December 30, 2014

Greece's snap elections | The Economist

In graphics: Greece's snap elections | The Economist

Samaras Has Four Weeks to Trump Syriza on Greek Economy - Bloomberg

Samaras Has Four Weeks to Trump Syriza on Greek Economy - Bloomberg

Greece In Turmoil After Third Failed Presidential Vote Means January 25 Snap Elections | Zero Hedge

Greece In Turmoil After Third Failed Presidential Vote Means January 25 Snap Elections | Zero Hedge



This means that the "worst case" scenario - at least as described by Goldman - is now on deck: a snap general election that could bring the anti-bailout Syriza party to power.

Greek Bond Yields Over 12% At Post-Bailout High | EconMatters

Greek Bond Yields Over 12% At Post-Bailout High | EconMatters



In general, it is clear that there are concerns around SYRIZA’s ability to govern and what exactly they will do when in power. They have said they will renegotiate the Greek bailout and push for a debt restructuring, however, it is far from clear what they will do if they do not get what they want or how hard they will push back against other eurozone countries unwillingness to take such action. Much of the market uncertainty – Greek borrowing costs have risen and the stock market has fallen sharply – can be attributed to markets trying to price this political uncertainty.

Monday, December 29, 2014

Roger Farmer : "The Greek dance with debt"

Roger Farmer's Economic Window: The Greek dance with debt: If you thought that the Greek debt crisis was over; think again. Tomorrow, the Greek parliament will try, for the third time, to agree on w...



One hour ago Parliament decided to have an election by Feb. 1st

Most likely scenario (60% probability):



  1. SYRIZA tops the polls without a Parliamentary majority.
  2. Only potential, anti-MOU, coalition partner, right-wing ANEL party, does not enter Parliament by some 0.3 percentage points.
  3. Only possible coalition partner(s) are the conservative ND of incumbent PM, PASOK, or POTAMI.
  4. None of these three can, or will, stomach the programme of SYRIZA.
  5. The left wing inside SYRIZA will not stomach any compromise on the campaign programme.
  6. New elections are anounced for sometime late Feb or beginning March
  7. The bailout programme expires on Feb 28
  8. Rating agencies downgrade Greek debt and ECB cannot accept it as collateral. ELA is the only mechanism for financing Greek banks and the Athens bourse tanks; as I write, it is down 10%. 
  9. Armageddon for the Greek economy.
  10. Brussells, Berlin, and Frankfurt "shrug shoulders" and carry on "business as usual".
  11. EURO is saved(!!!) at a bearable cost.


Disclaimer: I am about to lose something like 50% of the purchasing power of my pension on top of the 45% I have lost since 2010

"Euro zone rattled as Greece braces for elections" : Reuters
"Greece's Presidential Vote Just Failed And Markets Are Crashing" : Business Insider

Friday, December 19, 2014

How does my country grow? Lessons for the EZ | VOX, CEPR’s Policy Portal

How does my country grow? Lessons for the EZ | VOX, CEPR’s Policy Portal

Structural reform is particularly costly in the context of a debt overhang and an overvalued exchange rate. However, the crux is not debt restructuring per se, but whether economic governance changes credibly for the better following it.


The Canuto, Pinto, and Prasad paper 

How Can Scandinavians Tax So Much?

AEAweb: JEP (28,4) p. 77 - How Can Scandinavians Tax So Much?



the discussion has also identified a set of concrete policies that can go some way towards explaining the Scandinavian puzzle, namely the use of far-reaching information trails that facilitate tax compliance, broad tax bases that limit the scope of legal tax avoidance, and large public spending focused on complements to work.

Διαμαντοπούλου, Φλωρίδης :"Οι μισές αλήθειες και ο πραγματικός κίνδυνος" | Μεταρρύθμιση

Οι μισές αλήθειες και ο πραγματικός κίνδυνος | Μεταρρύθμιση

Friday, December 12, 2014

Discussing Karl Polanyi, Understanding the Current Crisis - Books & ideas

Discussing Karl Polanyi, Understanding the Current Crisis - Books & ideas

Ο σκληρός διαπραγματευτής, Τσιόδρας Δημήτρης | Μεταρρύθμιση

Ο σκληρός διαπραγματευτής, Τσιόδρας Δημήτρης | Μεταρρύθμιση

Seeking the Future of Europe in the Ancient Hanseatic League | Stratfor

Seeking the Future of Europe in the Ancient Hanseatic League | Stratfor

Edward Hugh : "It’s Baaack: Looming Greek Elections Threaten To Re-ignite the Euro Crisis"

It’s Baaack: Looming Greek Elections Threaten To Re-ignite the Euro Crisis | A Fistful Of Euros

Mr Tsipras will be banking on the idea that the EU leaders will back down, and talk turkey. But what if they don’t? Their room for manoeuvre on this front is far more limited than it is on the debt one, since others in the south would surely want to follow a similar path if they thought they could. Grexit may be something that no one actually wants to happen, but sometimes things no one wants to happen do.

Friday, December 5, 2014

A. Orphanides : ECB policy and Fed normalisation

cepr.org/sites/default/files/policy_insights/PolicyInsight75.pdf

A. Orphanides : ECB policy and Fed normalisation

cepr.org/sites/default/files/policy_insights/PolicyInsight75.pdf

How Can Scandinavians Tax So Much?

JEP (28,4) p. 77 - How Can Scandinavians Tax So Much?

When Will the ECB Move on Monetary Stimulus?

RealTime Economic Issues Watch | When Will the ECB Move on Monetary Stimulus?



"An Added Uncertainty: Greece, Spain, and Portugal

Another confrontation looms between the Greek government and the rest of the euro area next year. Because the government in Athens seems increasingly unlikely to muster enough votes to elect a new president to succeed Karolos Papoulias, early elections are possible.4 Syriza—the main leftist opposition party seeking to end large parts of the country’s current reform program, lower Greece’s primary surpluses, stop privatization programs, and reverse some structural reforms—is leading in the polls. Should it win power in new elections, the euro area will likely refuse most of its political demands, setting the stage for a mini-repeat of the summer of 2012, where the euro area relied on market mayhem to convince Greek voters to vote for a responsible government. Whether or not such a hardball electoral tactic works again, it will complicate decision making for the ECB on sovereign bond purchases. The ECB would hardly want to purchase any Greek government bonds in a period of conflict over Greece. The ECB lacks the option of buying a GDP-weighted basket of all euro area members, and it would not want to determine which countries’ bonds would be eligible, politicizing its own role in a most unwelcome way."