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Eurogroup rejects Greece’s Program extension, ECB to decide on Wed on ELA, IMF after midnight

+++ Jeroen Dijsselbloem after Eurogroup meeting: “There could not be program extension, it expires tonight. The Greek proposal will be examined after the Referendum.”

That was also Germany’s stance, to discuss again on Greece after the Referendum.

A Eurogroup meeting via teleconference will be held 12:30 noon BE time (GR time) on Wednesday in order “to review the situation”.

As of Midnight, Greece is without the “protection” of a program as seen in the context of the ECB’s ELA.

The European Central Bank is to convene tomorrow Wednesday and decide on whether there is Greek collateral to raise the Emergency Liquidity Assistance for Greek banks.

Greece submitted a request to ECB on Tuesday. See below.

The IMF is expected to announce its decision on Greece at o1:01 am GR time, after Athens failed to pay 1.6 billion euro.

Below what KTG has written before Dijsselbloems’ statement:

Eurogroup teleconference concluded after one hour on Tuesday night, another meeting is follow on Wednesday morning. The Eurogroup met to discuss a request submitted by Greek Prime Minister Alexis Tsipras who was asking for a two-year loan by the ESM and a short program extension.

According to Greek media citing sources form Greek FinMinistry, together with Tsipras’ letter, Greece sent also a list of conditionalities
(measures) necessary for the ESM financial aid.

So far, not much has been leaked to the press. Except the Finnish FinMin Alexander Stubb who tweeted after the meeting:


From the studio of state broadcaster ERT TV, Deputy PM Yannis Dragasakis downplayed Stubb’s tweets, saying “there are too much leakages to the press and too many Tweets” when it comes to Greek negotiations.

Dragasakis revealed that during the intensive talks on Tuesday, Greece sent also to creditors:

1. Issues to be excluded from further austerity – like labor and pensions
2. Proposals for new program as the current one expires at midnight
3. Request to ESM for loan
4. Request to IMF for payment extension, postponement until November 2015.
5. Request to ECB to extend ELA limit

According to “EU sources”, Greece sent proposals that are closer to those of creditors.

With bank holiday and capital controls, a deal or not deal would certainly affect voters on Sunday’s Referendum. PM Tsipras said on Monday that “we will respect any outcome” however for the case of a YES outcome he implied he may resign if the government’s stance was NO. That is for the case, the voters decide for Creditors’ Austerity Proposals of June 25th, while the government has not reached a good deal with the lenders.

Complicated? Everything changes every half an hour…

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  1. Is Dijsselbloem trying to suck up to Merkel since it was reported that she wasn’t supporting him in the next election for chair?

    What a creep.

  2. I doubt anyone was expecting this proposal to be accepted by the creditors. I believe, the main objective of the Greek government was to show that negotiations are still ongoing. Maybe, that could help government’s case for the referendum No vote. (Someone on the ground in Greece can comment whether makes any difference there).

    I would speculate that a more important objective of submitting this proposal was to prevent ECB from declaring the Greek banks insolvent and cancelling the ELA altogether tomorrow, after the Greek default to the IMF today. At the moment ELA is still in place, even though the limit was not increased by ECB on Sunday. The logic is: if there is some semblance of negotiations, ECB will not dare to press the red button and will leave it to elected officials to make such a critical decision. We will know tomorrow whether the Greek government has accomplished this mission. (My guess is that ECB will not cancel the ELA tomorrow).

    • keeptalkinggreece

      do you seriously expect to have the whole proposal on your pc screen????

      • I did not mean to say the proposal will not be accepted because it is too short. It just does not offer any steps towards a compromise compared to what was discussed last week. In fact, it goes off on a new tangent (as opposed to offer a new iteration of the offer Tsipras made last Monday, which the creditors replied to last Wednesday, and which was being negotiated on until Friday night).

        BTW, the offers and counter-offers last week were fairly short (5-6 pages) and were made public. Maybe, these 2 pages were indeed the entirety of the offer sent by the Greek government today.

    • Giaourti Giaourtaki

      Nobody can declare banks insolvent that have 120 billion savers money and if it’s not there it’s stolen by central bank aka ECB

      • Um, no, not the ECB. It’s the government that has stolen a large chunk of these 120 billion, in the form of bonds and t-bills, which it sold to the banks, and now cannot repay. That’s where the savers’ money went.

        • Garbage. Try putting your stinking rubbish outside for collection, instead of putting it on display.

          • So, riddle me this from Finance 101. Banks take depositors’ funds and lend them out. This is just a swapping of one asset for another. A sizable portion of those loans is in the form of government bonds. As long as these loans are performing, the banks can just use them as collateral for fresh cash and cover any withdrawals. Now, since the confidence in the bonds’ value has been destroyed, due to the inability of the Greek government to repay, they can no longer be used as collateral. Hence the needs for ELA – the capping of which induced the capital controls. I’m just the messenger, don’t shoot me.

          • Yes, very funny. You forgot to mention the global financial crisis that led to all this, whereby banks across the world realised in 2009 that their assets were worth next to nothing. This impacted on the eurozone, and Greece (like many indebted countries) was unable to continue borrowing. Some countries, such as the UK, were considered safe to lend to, despite poor economic performance.

            As you know, the eurozone decided to put taxpayers’ money into the German and French private banks and assume the Greek state debt as eurozone debt. That is where we are now.

            Your comments have nothing to do with anything. try going back to school.

          • Giaourti Giaourtaki

            So greedy Banks steal the money of the savers, banks should lend out their own money they make enough of!
            All Europeans should go to the bank and get their money back

      • Banks’ liabilities far exceed deposits, no? What happened to depositors (savers) in Cyprus?

      • EXACTLY
        What I do not get is how the Greek government hasn´t taken control of the banking system, including its own central bank that is in the hands of a traitor IMF minion!

        • The Greek banking system is a component of the eurozone banking system. The banknotes are printed in Germany and are sold to Greece, under the control of the ECB. Greece signed away its economic sovereignty by joining the euro. So the Bank of Greece is not an independent central bank: it is a fake national central bank that takes its instructions from Germany.

          • Giaourti Giaourtaki

            If you got an “Y” starting the ID# on your note it’s printed in Greece

  3. Eurozone is getting tired. Greece is 2% of EU economy and taking much too much of others’ time to play silly games. Greece partners have their issues, political and economic, domestic and global. They will want to take a break from dealing with Greece. They also want a clear break from current program and any extensions. So many extensions have been proposed: week, month, year end, two years.
    Since ECB meeting tomorrow will review collateral, my guess is, they will conclude that there is no more eligible collateral and ELA limit cannot be raised.
    Tsipras will have his referendum. If Greece wants to stay in EZ, Yes or No vote, there will be negotiations on another program, debt relief, etc., but at more normal pace and without Tsipras and Varoufakis. That’s because any new bailout program will still include reforms Syriza cannot accept.

    • The “silly games” are being played by the ignorant eurozone mafia, along with the bitch Lagarde who thinks she owns the IMF. (She is a state employee, not an employer). The greek problem is about the lives of millions of Greeks, it is not a game.

      Yes, Greece is a tiny part of the eurozone. I suggest you find a way to behave properly, instead of Nazi style abuse of power. Did the Germans learn nothing from their last humiliation? They are lucky to have been allowed to keep their country, and are now running around telling everyone what to do.

    • Giaourti Giaourtaki

      Too stupid that millions of tourists and Diaspora will tell the truth when back home, lots of lost votes for European and American parties

    • “but at more normal pace and without Tsipras and Varoufakis.”
      With traitors that cave in to their masters for a penny.
      Problem is I do not think ND or Potami or anyone has the capability to do that in Greece, even if the yes vote wins.

  4. I agree. Greek government played a lot of non-sense drama during last 5 months, so everyone in the world is tired about its silly games. Now, everyone see Greeks as a kind of Mafia guys (gamblers and blackmailers) which is not correct. I’m sure Greece could get much more through honest negotiations…

    • Giaourti Giaourtaki

      Greek Süß? And why don’t you destroy the responsible Goebbels-media? What world? The overpopulated 1st world or the by the 1st exploited 3rd and 4th? The majority doesn’t even has internet or tv, the world don’t knows about…

  5. Reuters reported (based on euro zone sources) that Greece’s Finance Minister Yanis Varoufakis indicated during the conference call with his European counterparts that Athens might scrap the July 5th referendum if a deal was reached. Obviously, that did not happen. However, if true that would be an indication that the Greek government is using the referendum as a tactical tool in the negotiations.

    • keeptalkinggreece

      several SYR MPs indicated this yesterday. but GERM says: first cancel then we talk. so question: can there be an agreement before Sun? given the moment status quo I hardly believe. but things change very quickly these days.