Eurozone agrees new 109bn euros Greek bailout

[zigackly]

Eurozone agrees new 109bn euros Greek bailout

 

Leaders of the Eurozone countries have agreed a new bailout package for Greece worth 109bn euros ($155bn, £96.3bn).

 

It includes, for the first time, support from private lenders, including banks, which will give Greece easier repayment terms.

 

The deal, struck at an emergency summit of the Eurozone's 17 member countries, also involves support from the International Monetary Fund (IMF).

 

Banks and other private investors will contribute 37bn euros to the package.

 

French President Nicolas Sarkozy said private lenders will contribute a total of 135bn euros over 30 years to Greece.

 

'Haircut'

The involvement of commercial lenders in providing assistance to Greece had been one of the thorniest issues under discussion.

 

France and the European Central Bank (ECB) were against it, fearing it could spark a Europe-wide banking crisis, push Spain and possibly Italy into trouble, and even jeopardise the solvency of the ECB itself.

 

Germany though insisted on the private sector bearing some of the pain, or, in the jargon "taking a haircut".

 

One sticking point against roping in non-government lenders was that any move to allow the country easier repayment terms would be viewed by credit rating agencies as a tacit admittance that it was unable to sustain its borrowings - something that would put it into "partial default".

 

That would limit the ability of certain institutions, including the ECB, to continue to lend Greece money, as its own rules mean it can only accept collateral from borrowers the agencies say have not defaulted on loans.

 

European Commission President Jose Manuel Barroso said: "We... endorsed the plan of reducing overreliance on external credit ratings."

 

He said policymakers would come forward in the autumn "with further proposals".

 

EFSF freedom

Another key element of the package is an expansion of the role of the European bailout mechanism, the European Financial Stability Facility (EFSF) so it can act more freely.

 

The President of the European Council, Herman Van Rompuy said: "Reform of the EFSF will make it more flexible and effective. We do not now have to wait for substantial damage to occur before we can intervene."

 

Financial markets had gained on hopes of a new deal.

 

Shares in Milan rose by 4%, and Spanish shares jumped 3%.

 

European banking shares led the way. In Germany, Commerzbank climbed almost 9% and Deutsche Bank rose 3.6%, while in France Societe Generale and Credit Agricole gained about 6%.

 

German and French banks are the biggest holders of Greek debt.

 

UK banking shares also rose strongly, with Barclays gaining 7.7%, Lloyds 5.9% and RBS 5.7%.

 

Greece received its first aid package in May last year, but the debt crisis continues to undermine confidence in global financial markets, with some commentators suggesting it threatens the future of the euro itself.

 

Athens has already implemented a raft of wide-ranging austerity measures, including spending cuts and tax rises, and earlier this month agreed to further drastic action to cut its debt.

 

 

----------------------------

 

Fuck. Ing. Hell.

 

Talk about throwing good money after bad. We should have just built a big wall around the border ... would have been cheaper and more effective.

[King Emlyn]

wowzer

[Magellan06]

More of our pension funds down the toilet, no wonder they want/need us to work till we die.

[zigackly]

Maybe we should be getting them building massive ghost cities like the Chinese. That should prop the economy up for a bit.

[Beantown Red]

I see Ireland is also getting a rate cut and longer time to pay back

 

Ireland to get bailout rate cut

 

The Taoiseach Enda Kenny has said the debt burden on the Irish people has been made lighter this evening after the EU agreed to cut the interest rate on the country's bailout.

 

It is understood that Ireland's bailout interest rate will be reduced from around 6% to somewhere between 3.5% and 4%.

 

Irish officials estimate such a cut would mean an annual saving of €600-700m to the exchequer during the lifetime of the EU/IMF deal.

 

Ireland has also secured a concession on the maturity of the loan, meaning it can now be repaid over a 15 year period as opposed to 7.5 years.

 

Fianna Fáil TD Michael McGrath welcomed the news but said some important questions still needed to be answered in relation to it.

 

He said it needed to be clarified what the Government has agreed to in relation to tax harmonisation as part fo the deal, which could he said represent a real danger to this country's interests.

 

In a statement tonight, Eurozone leaders also confirmed that a new bailout for Greece, worth €159bn, had been agreed.

 

European governments and the IMF will put €109bn into the package with private institutions due to give €49.6bn through a mixture of contributions and debt buy-backs.

 

Greece would now have a minimum of 15 years to pay back the loans and a maximum or 30 years. They also said they would lower Greece's interest rate to around 3.5%.

 

The euro and European stocks, which had fallen on reports of a possible selective default, rallied sharply on news of the draft conclusions.

 

The euro topped $1.44 following the leaking of the draft agreement.

RTE

[Section_31]

How much will it Kostas?

[Guest Jon Snow]

Bought time we got the fuck out of Europe don't you all think.Total madness.

[Hermes]

They got bills

They're multiplying

And they're losing control

They better shape up

[RedinSweden]

Bought time we got the fuck out of Europe don't you all think.Total madness.

 

You do realise that the UK isn't in the eurozone, don't you?

 

The UK has quite a small exposure there. I think the only issue for the UK here is the effect it may have on the Irish debt as the UK is far more involved there. Whether or not we were in the european union, this would have affected the UK indirectly anyway.

[zigackly]

I think it may affect us when the whole European economy goes tits up. It's like pouring money down an open drain. The worrying thing about all this for me is that we have already wrecked our economy for the foreseeable future with bailouts (I believe something stupid like 90% of our national debt has been accumulated quite recently on trying to stop various ships sinking), but if Europe goes under we will be even more isolated. Maybe we should be gibbing off America and becoming China's bitch. At least they have money. All the money. In the world.

[Malarkey]

Eurozone sounds like a shit program that's on the BBC at 5 in the morning.

[Skidfingers McGonical]

George says tax payers wont pay for it.

 

So riddle me fucking this George, how is the country help bail out another country then?

[Skidfingers McGonical]

Eurozone sounds like a shit program that's on the BBC at 5 in the morning.

 

Presented by Timmy Mallett and Mad Lizzie Webb.

 

With Wincey Willis doing the weather.

[Guest Slim(fast)Shady]

If i were a country...i'd be Greece!

[dennis tooth]

 

Cant beleive they are bailing these cunts out!

[Section_31]

I think it may affect us when the whole European economy goes tits up. It's like pouring money down an open drain. The worrying thing about all this for me is that we have already wrecked our economy for the foreseeable future with bailouts (I believe something stupid like 90% of our national debt has been accumulated quite recently on trying to stop various ships sinking), but if Europe goes under we will be even more isolated. Maybe we should be gibbing off America and becoming China's bitch. At least they have money. All the money. In the world.

 

The problem is that the huge black hole which came from the credit crunch hasn't been filled in, it's just been passed from banks to states. The aftershocks of it have also ravaged huge parts of national economies. But for me, the issue is still a structural one. Globalisation caused this. Countries only boom when their working class is employed en mass and manufacturing forms a big part of the country's physical infrastructure. It's no coincidence that the USA boomed in the aftermath of world war 2 when cities like Detroit were churning out motors, firdges, you name it. Now people are using the old building there to grow tomatoes.

 

Meanwhile, over in China, the place is a fucking Bladerunner fest because their poor are bing put to work making shit for us.

 

The bit which is overlooked though and never spoken when people talk about globalisation as some kind of force of nature that we just have to 'live with', is that it was handed to them. We were not overtaken by countries like China and India, the wealth owners in this country merely saw an opportunity to make more money for themselves by cutting costs, and so scooped up whole industries and factories and dropped them on Shanghai. And what's left? A single mother feeding her kid a pasty, and an MMA gym.

[Elmyn Noos]

Fucking eurocrats want to straighten the banana don't they AND take the queens head off ar parnd. Fucking sprouts. It's about time we pulled out of this Earth thing and started our own planet.

[Stu Monty]

We're all in this together.

 

Say the bottom 95%.

[Strontium]

The problem is that the huge black hole which came from the credit crunch hasn't been filled in, it's just been passed from banks to states. The aftershocks of it have also ravaged huge parts of national economies. But for me, the issue is still a structural one. Globalisation caused this. Countries only boom when their working class is employed en mass and manufacturing forms a big part of the country's physical infrastructure. It's no coincidence that the USA boomed in the aftermath of world war 2 when cities like Detroit were churning out motors, firdges, you name it. Now people are using the old building there to grow tomatoes.

 

 

The problem here is that tinpot basketcases like Greece probably shouldn't share a currency with economic powerhouses like Germany. The Greeks weren't ready to join the Euro and now everyone is paying the price.

[Funkasy]

All the Greek parlament going on a luxury cruise trip after this bail out and use about 1% of the money the country got.

[Stu Monty]

Good to see that the bankers got their massive bonuses again this year. It would be a shame if their mistakes, that are still echoing around the world, meant they had to share any of the pain.

 

The dice are loaded.

[dennis tooth]

Not dollar, not euro, but gold - Features - Al Jazeera English

 

read it and weep.

[a stoner]

Fuck em. Let em sink. Their own citizens don't want it so why the fuck should the rest of us care.

[Hermes]

Highest paid public sector workers in Europe.

 

Public sector workers retiring on full pension in their 50's.

 

.....and they wonder why they are in deep shit?