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ECB Vice Constancio: Grexit threat was “never for real”

Vice President of the European Central Bank Vitor Constancio openly  admitted that the threat of kicking Greece out of the euro zone during the spring negotiations was “never for real” because it would not be legal.

So simple. So cynical. So unabashed. So real.

In an interview to Reuters, Vitor Constancio replied to the question “What doubts were raised about the euro?”

“It raised doubts for the markets that countries like Greece could cope with the challenges of monetary union. There was never any doubt among the majority of member countries. We maintain that the euro is irreversible. Legally, no country can be expelled. The actual prospect of that happening was never for real.”

Below an excerpt from Reuters’ on Constancio interview about Greece.

Although the Greek crisis shook confidence in the euro area, Constancio said ejecting Athens from the currency was “never for real” because it would not be legal and Europe now has to erase any lingering doubts about the bloc’s viability.

The new Greek government, due to take office after elections this month, must commit to the 85 billion euro bailout deal and if the program stays on course, the easing of capital controls may not be far off.

“The stage is set for a gradual dismantling of the capital controls,” Constancio said. “They will be eliminated as they were in Cyprus.”

He added Greek debt should not be viewed in simple ratios and he expects views, including those of the International Monetary Fund, to converge when debt sustainability is discussed in the first review.

“A haircut has been refused by the member states and I certainly hope it will not be necessary in view of the numbers,” Constancio added. “The more one digs into the numbers, the more that sort of conclusion seems to emerge.” (via Reuters)

Constancio’s full interview transcript here

For future generations to keep in mind: “scaremongering” is a commonly used  tactic by so-called Institutitions to hold governments and citizens as hostages.

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  1. He is talking bs, in that there was never any doubt that noone can be kicked out of the euro. Even schauble kept saying its only the greeks that can decide to leave. So the plan was never to kick out greece, it was to make them go on their own.

  2. Varoufakis was right. Tsipras blinked for nothing.