Greek Banksters in Action: On the latest twist in the story of mafia-style terror spreading through the Greek polity

Last November I posted a piece entitled A Small Victory for Press Freedom in Greece’s Struggle against Cleptocracy. That story concerned the courageous decision of Kostas Vaxevanis, one of Greece’s few, valiant investigative reporters, to publish the so-called Lagarde List; the list of Swiss bank account holders that Greece’s political class did its utmost to keep hidden, to pretend that either it never existed or that it had been ‘misplaced’. Since then, Vaxevanis has been arrested by Special Branch officers, was tried in the Greek Courts, was acquitted triumphantly, and, more recently, awarded one of international journalism’s top awards.

In an earlier piece, last July, (entitled Bankruptocracy in the Greek Sector of Bailoutistan) I had drawn my readers’ attention to the remarkable revelations of Reuters’ Stephen Grey regarding the ponzi scheme put together by Greek bankers for the purposes of usurping Europe’s bank recapitalisation rules, pretending that they managed to draw private capital into their insolvent banks which never really existed. My piece castigated the Greek media for maintaining a veil of silence on these corrupt and criminal practices, while highlighting the troika’s curious lack of interest in the shenanigans of bankers who are receiving billions of European taxpayers’ money (in the process of the so-called ‘recapitalisation’ process).

Today’s post links these two stories together in a manner that you, dear reader, will find startling, worrying, enraging, disconcerting. It comprises, mainly, the summary of a letter that Kostas Vaxevanis sent to a London based journalist last week (the translation and summarising from the Greek original is mine). With this letter Vaxevanis sought support, advice and an opportunity of spreading the news of the dire situation faced by Greeks (citizens and journalists) who refuse to keep silent in the face of deep seated, criminal corruption. I urge you to read on.

“In May 2012, I investigated the functioning of Greek banks, with special emphasis on a certain Greek Bank (The Bank henceforth) and its Chairman (The Chairman). I found that The Chairman’s family members were the secret owners of a number of offshore companies that would receive loans from the bank without any real collateral. These loans would then: (a) be written off as unserviceable, or (b) be used to buy office space that would immediately be resold to other parties which would then lease them to The Bank or sell them to The Bank at inflated prices. In addition, other offshore companies were used by The Chairman to borrow substantial amounts from two other Greek banks, again with no collateral, for the purposes of buying shares The Bank (thus helping the bank demonstrate its capacity to draw in private capital). Since then the owner of one of these two other banks has been imprisoned (on different charges) while the second bank involved has played a central role in bringing down the Cypriot banking system (after its merger with one of the island’s now collapsed banks and the transfer of its headquarters from Greece to Cyprus).

After the publication of these two investigative pieces, photographs of Stephen Grey (the Reuters investigative reporter who broke a part of this story to an international audience), were published in various websites with the caption: “The man who came to destroy Greece”. Worse still, the same blogs circulated a ‘document’ which ‘showed’ that I was on the payroll of the Greek state’s intelligence services. I managed to defuse this campaign of defamation by writing extensively about it in the press.

On 11th September 2012, late at night, a group of 4 or 5 people staked out my home. It was only accidentally that I avoided being ambushed (my motorcycle had a flat tire and I thus returned home in a friend’s car). Upon noticing the stalkers I called the police and asked them to come quietly. The police arrived noisily and went to a nearby house first, thus giving the men plenty of time to make their escape. For days, the police refused to investigate properly or to call eyewitnesses to make a statement (later, after I published the story, they did). Since then, I have been denied police protection (unlike most other journalists) and have had to resort to private security.

Soon after the failed ambush, a woman visited my office insisting that I should see her to discuss “the bankers’ designs” on me. I decided to meet with her. She was a frightened woman who claimed to be in grave personal danger. She said that she had been, and was, part of a group comprising former agents and salaried members of the Greek intelligence services, connected to business interests who worked on, at first, wrecking my public image and, later on, planning my physical demise. She added that it was her who, following specific orders, had forged the document ‘proving’ that I was on the payroll of the secret service – a document which her group then circulated to the various blogs that used it.  

According to her testimony to me, a group stationed in Skopja was engaged to “see me off”. Part of the same plot concerned the defamation of another woman, a former bank manager with The Bank, who had been fired on false charges of embezzlement because, in truth, she possessed damning evidence concerning The Chairman’s family’s activities. Their plan, vis-a-vis this former bank manager was to plant narcotics in a restaurant that she owned on the island of Zakynthos and to orchestrate a very public arrest so that, in the future, if she ever revealed her evidence against The Chairman’s family, the press could dismiss her as a ‘drug dealer’. To prove her story, my interlocutor handed over a sequence of photographs that were the result of the surveillance of the former bank manager taken by «her group». The woman further claimed that she had not dared distance herself from that group but she was afraid that she would be killed upon completing her ‘tasks’.

On our part, we immediately investigated her claims. We subjected her to an accredited graphologist’s test who comfirmed that the forged document showing that I was, supposedly, on the secret agents’ payroll (as published in various blogs) was in her handwriting. We also confirmed with the ferry company that the car in which that team of operatives was supposed to have travelled to Zakynthos (to plant drugs in order to frame The Bank’s former employee) had indeed travelled there. We also established that the car was registered to former intelligence agents who had been prosecuted for an number of misdeeds – and whose court case is pending.

I met with this woman a number of times in an attempt further to establish the truth of her allegations. In one of these meetings, she said that the headquarters of her group was close to our magazine’s (HOT DOC) but also that the group had abandoned those quarters fearing that we had worked out they were conducting surveillance on us from there (after I had written in HOT DOC that I know I am being followed). Furthermore, the woman handed to us audio records from her group’s meetings in which they were discussing their plans. We went to the address she gave us to find abandoned offices that were for lease and to see if they featured hidden crypts (where the woman had told her group kept weapons). We found these hidden crevices and photographed them.

To protect myself, I wrote a report on the above which I sealed and delivered to a notary to be released on the event of my death or disappearance. I also visited a district attorney whose incorruptibility I trust. The woman left Athens and is in hiding, even though I remain in contact with her.

Following the above events, I was contacted by the group of people that I consider to have planned to assassin me. I alerted the police and met with them under police surveillance. In the meeting, they denied everything and pretended they had nothing to do with any of these plans. I left that meeting and then refused to take their repeated calls. A few days ago the case files were transferred again from the police to the district attorney. I know nothing further about the law agencies’ activities in this regard.”

Kostas Vaxevanis’ letter then moves on to another, related, issue: The Lagarde List which he and HOT DOC published causing a major political storm, that echoed around the world, and leading to his arrest (for endangering the privacy of those on the list) – not to mention to worldwide acclaim at least within the international community of investigative journalists. Vaxevanis was then acquitted in a short and triumphant trial but the prosecution appealed with the result that a second trial will take place next June.

Meanwhile, following the publication of the Lagarde List, and under enormous pressure from public opinion, the Greek Parliament set up an investigative committee (made up of parliamentarians from each party, in proportion to their strength in Parliament – as per the Constitution) to investigate only one person: the former Minister of Finance, Mr George Papakonstantinou under whose watch the Lagarde List got ‘lost’ within the Greek government and was never utilised by the authorities. The said Committee has a remit to rule on whether there is sufficient evidence to try Mr Papakonstantinou. In the context of its investigation, the Committee calls witnesses who are then examined by members of the Committee. In his letter, Vaxevanis says that, even though no one disputes that the list he and HOT DOC published was the original Lagarde List – as given to him by an anonymous person – certain members of the Committee subjected him to aggressive examination (something that I can vouch for having read the official transcripts as produced by the Greek Parliament) the purpose of which was, clearly, not to establish the truth about the Lagarde List but to discredit Vaxevanis and HOT DOC. Vaxevanis notes in his letter that the members of the Committee that were most aggressive happened to be the ones that ought to have stood down from the Committee on the basis of a clear conflict of interest. In particular, Vaxevanis writes in his letter:

“The mother of one member of the Committee was on the Lagarde List. The wife of another member of the Committee appears to have power of attorney for an account on the Lagarde List. The third member, who happens to Chair the Committee, is the lawyer of a tax office employee who has been convicted for having embezzled millions of euros of tax payers’ money. He has also been the subject of two parliamentary investigations but escaped prosecution shielded by legislation that gives investigators/prosecutors a mere two years before the case is considered to fall under the statute of limitations.”

Vaxevanis’ letter finishes thus:

“I thought it important to relate to you these events. I am in need for your assistance and advice. Every day that goes by, a new piece of a conspiracy is put together and I fear that the jigsaw may be completed by the time my second trial takes place in June. I feel they are keen to convict me while giving me the option to pay a fine instead of serving time in prison. Of course if convicted I shall refuse to do so, opting for prison in order to publicise in that manner what is going on in this country. I could ask for assistance from opposition parties but I revile the idea of becoming part of the party political game. Thank you for your attention and apologies for tiring you with my long-winded story. Alas, you are our only allies. Greece is sinking not only in an economic crisis but also in filth.”

Epilogue

You may wonder what happened to The Chairman and to The Bank. The Chairman is doing fine, thank you. His insolvent bank has now turned into a (by Greek standards) Too-Big-Too-Fail monster, having been handed on a silver platter the good chunks of banks that the Greek taxpayer has paid through the nose to carve out of failed operations. Those in the know expect that he, amongst all Greek bankers, will probably manage to retain control of ‘his’ bank after ESM-funded recapitalisation (though no one seems to know why he can attract private capital when healthier banks, like the National Bank of Greece, are failing to do so). His close connections with people high up in the Central Bank of Greece and in the political establishment (that the average Greek refers to as the Cleptocracy) have ensured that his power to extract rents from the rest of a crumbling society is inversely proportional to ‘his’ bank’s performance. Being a major ‘sponsor’ of the bankrupt (both financially and morally) Greek media has certainly not done him any harm.

Bankruptocracy in the Greek Sector of Bailoutistan is, thus, progressing in leaps and bounds. With European taxpayers’ loan guarantees providing the capital and a bonfire of the Greek people’s hopes for the future supplying the energy.

105 thoughts on “Greek Banksters in Action: On the latest twist in the story of mafia-style terror spreading through the Greek polity

  1. Pingback: Σάλλας, Αγγελάκης, Κουκουλίτσιος τα ονόματα του ρεπορτάζ Βαξεβάνη | @SimonKnowz

  2. Pingback: Pointer: Banksters, the Greek deep state and their unholy link | You don't know jack about Greece

  3. Great! Bundesbank shows dove- Draghi the finger!

    “Germany’s Bundesbank has criticised the ECB’s bond-buying plan in a leaked report for Germany’s Constitutional Court, as Spain prepares to unveil new measures to spur its economy.”

    “German newspaper Handelsblatt reports today that the Bundesbank has rejected the European Central Bank’s bond-buying programme in a confidential opinion for the country’s constitutional court.

    Gary Jenkins of Swordfish Research notes that the Bundesbank rejects the idea of sovereign bond purchases in strong terms.

    Apparently, the Bundesbank reckons that the so-called Outright Monetary Transactions could undermine independence of central banks.

    But, the Bundesbank president Jens Weidmann has been public from the start about his organisation’s opposition to the OMT programme launched last September by Mario Draghi (pictured above). He has criticised the programme many times.

    The Bundesbank has confirmed as genuine the leaked report. The bank has also confirmed that Mr Weidmann will travel to the constiutional court hearings in June.

    • And here is the AFD manifesto in english:

      “Election Manifesto
Board resolution dated 21.3.2013
Alternative for Germany
      [Monetary Policy]
      We call for an orderly dissolution of the euro zone. Germany does not need the euro. The euro damages other countries .
      We call for the reintroduction of national currencies, or the creation of smaller and more stable currency unions. The reintroduction of the DM should not be a taboo.
      We call for a review of the European treaties, to enable each State to leave the euro. Each nation must be allowed to democratically decide its own currency.
      We demand that Germany compels this right of withdrawal from the euro in that it blocks further aid loans to ESM with its veto.
      We demand that the costs of the so-called bailout policy are not borne by taxpayers. Banks, hedge funds and large private investors are the beneficiaries of this policy. They first need to be called to account.
      We demand that hopelessly over-indebted countries are disencumbered with a debt haircut.
      In the debt crisis, the banks themselves must bear their own losses or be stabilised at the expense of their major private creditors.
      We demand an immediate ban on the purchase of toxic assets by the European Central Bank. Inflation may not erode the savings of citizens.
      [European Policy]
      We affirm a Europe of sovereign states with a common internal market. We want to live together in friendship and good neighbourliness.
      We insist on the unrestrained budget right of national parliaments. We totally reject a transfer union or even a centralised European state.
      We will ensure that legislative powers are transferred back to the national parliaments.
      We will strongly advocate a reform of the EU to reduce bureaucracy in Brussels and to promote transparency and openness.
      The European Parliament has failed in the control of Brussels. We emphatically support the position of David Cameron to streamline the EU through more competition and personal responsibility.
      [Democracy]
      We call for a strengthening of democracy and of democratic civil rights. We want to introduce referendums and initiatives on the Swiss model. This applies especially to the assignment of important enpowerments to the EU.
      Parties should participate in the political system, but not control it.
      We call for more direct democracy, also in the political parties. The people should determine the will of the parties, not the other way round.
      We demand that members of the Bundestag devote their full working capacity to the parliament. Their mandate must not suffer because of paid secondary employment.
      We are committed to ensuring that unconventional opinions are also openly discussed in public discourse, in so far as these opinions not violate the values of the Constitution.
      [State Finance and Taxes]
      We demand that attention is paid to debt limitation and to reductions in the debt levels. Germany also has a lot more debt than permitted.
      We demand that the liability risks from the euro bailout policies are finally taken into account in financial planning. Currently, citizens are deliberately being misled.
      We call for a drastic simplification tax law in line with the progressively working Kirchhof taxation model. Citizens must be able to understand why they are being taxed at whatever level.
      {Pensions and Family]
      The euro crisis threatens all forms of retirement through indebtedness and minimum interest rates. The debt of the euro crisis must not lead to a pension dependant on the cash situation.
      We demand that children are taken into account more strongly in the pension calculation.
      Germany has too few children. Pensions and health insurance are therefore standing on unfirm ground. Germany must be more child and family friendly.
      We stand for the protection of the family as the basic unit of society. A solidary promotion of families is an investment in our common future and an fundamental element of the generational contract.
      [Education]
      We demand a uniform national education standard based on the best school systems in Germany.
      We demand the promotion of education as a core assignment of the family. Nurseries and schools must supplement this meaningfully. Nothing is more important for our future than the education of our children.
      First and foremost, parents are responsible for the education and upbringing of their children. The state must help them to accomplish this task. Early childhood education opportunities should be made available regardless of family background.
      We demand a high-quality university system that offers students appropriate support and funding opportunities. Also, a return to graduate programmes for proven diploma and state examinations must be possible.
      [Energy Policy]
      We demand a sustainable energy strategy for affordable energy. It is unacceptable that the people must expiate with dramatically increasing prices for the brain- and conceptionless policies of the federal government.
      We demand a reform of the Renewable Energy Sources Act (EEG). It is antisocial to finance subsidies for solar and wind energy through electricity prices.
      Instead, we demand that subsidies for renewable energy are financed from general tax revenues. It must be disclosed how heavily the various forms of energy are subsidised.
      [Integration Policy]
      We demand a reform of immigration law. Germany needs qualified and integration willing immigrants.
      We call for an immigration law based on the Canadian model. Disorderly immigration into our social security systems must be absolutely suppressed.
      Genuine politically persecuted people must be able to find asylum in Germany. For a decently humane handling, asylum seekers must also be able to work here.”

  4. This is a chilling story. One wonders how high up in the political sphere knowledge of this conspiracy goes. Imagine what would have happened to Kostas if he were not known internationally. I haven’t seen the foreign press pick up this story. Based on what I have seen recently, I don’t have much faith in the Greek courts, unless international pressure is applied.

    • Come one Dean – I expected better from you. The answer is twofold. First, recall the source of the ‘funds’ for last year’s IPO (have you forgotten the Reauter’s story). Secondly, because the bulk of the new capital came courtesy of the scandalous ‘mergers’ with the cleansed parts of ATE, Post Bank and now the cypriot branches. Scandals galore…

    • Yani, perhaps you misunderstood my angle. I am not suggesting that it is justified. I am saying it’s ironic.

      It sounds like a page out of Niccolo Machiavelli’s book “The Prince”. It sounds like this is not about ethical behavior rather it is about survival skills and a lot of rather unseen, sort of unconventional stuff that is hidden from us. No?

  5. @ waves: ” ARISTOTELES I think you’re being patriotic for the wrong reasons”

    No I am not. NBG is National Bank of Greece and should never become Deutsche Bank! I don’t give a sh*t anymore about this Germanic Europe, it shall go to hell but without us beeing part of this fricken Dis-Union.

    Κατά την άποψη μou, συμβαίνει ακριβώς το αντίθετο – αφού εάν το βασικό κυκλοφοριακό σύστημα μίας χώρας «κυριευθεί», τότε δεν μπορεί κανείς να μιλάει για εθνική κυριαρχία, παρά μόνο «κατ’ ευφημισμό».

    Ειδικά στην περίπτωση της Ελλάδας, όπου ο σχεδόν συντριπτικός αριθμός των επιχειρήσεων και των νοικοκυριών είναι υποθηκευμένος στις 2-3 μεγαλύτερες τράπεζες, η «επιθετική κατάληψη» τους από τους ξένους εισβολείς, δεν θα σήμαινε εύλογα το τέλος του Ελληνικού κράτους, τουλάχιστον ως αυτόνομης «οντότητας»;

    Περαιτέρω, χωρίς τράπεζες, καθώς επίσης χωρίς τις κοινωφελείς, τις κερδοφόρες και τις στρατηγικές επιχειρήσεις μας, τις οποίες προσπαθούν να μας πείσουν πως πρέπει να θυσιάσουμε (ιδιωτικοποιήσουμε) στο βωμό της αποφυγής της χρεοκοπίας, είναι δυνατόν να αποφύγουμε τελικά την ολοκληρωτική πτώχευση; Πότε στην ιστορία νίκησε κάποιος λαός σε έναν πόλεμο, σε μία μάχη έστω, έχοντας παραδώσει προηγουμένως όλα του τα όπλα στον εχθρό;

    Συμπερασματικά λοιπόν, είναι ποτέ δυνατόν, χωρίς όπλα, να αποφύγουμε την τρομακτική, απόλυτη χρεοκοπία, στην οποία θα καταλήγαμε λεηλατημένοι και εξαθλιωμένοι, όπως ακριβώς μία στυμμένη λεμονόκουπα; Είναι αυτός ο σωστός τρόπος για να τιμωρήσουμε τους, έστω διεφθαρμένους και τοκογλύφους, τραπεζίτες μας;

    Από την άλλη πλευρά, πιστεύει κανείς αλήθεια ότι όλα αυτά γίνονται για το δικό μας καλό; Πόσο μάλλον όταν η «εξυγίανση» της χώρας μας, το δημόσιο χρέος της οποίας ήταν στο 110% περίπου του ΑΕΠ της το 2008, μας έχει κοστίσει ήδη πάνω από το 100% του ΑΕΠ μας – αφού ευρίσκεται σήμερα στο 170%, μετά από δύο ανόητες διαγραφές (PSI) και με κατεστραμμένο το κάποτε υγιέστατο χρηματοπιστωτικό μας σύστημα;

    Πόσον καιρό θα χρειαστούμε ακόμη για να καταλάβουμε ότι, η εγχείρηση δεν έγινε για να διασωθεί ο ασθενής, αλλά για να αφαιρεθούν όλα τα υγιή του μέλη και να πουληθούν, ανεξάρτητα από το τι θα συμβεί στον ίδιο;

    Συνεχίζοντας, η «κατάρρευση» των μισθών μας, των εισοδημάτων, των τιμών των ακινήτων, των μικρομεσαίων επιχειρήσεων, του χρηματιστηρίου, της κατανάλωσης κοκ., παράλληλα με την έκρηξη της ανεργίας, την υπερφορολόγηση και την εξαθλίωση μεγάλων μερίδων του πληθυσμού, ήταν πράγματι το σωστό φάρμακο; Πικρό έστω αλλά απαραίτητο;

    Μήπως οι «ειδήμονες», το «Ταμείο» και η Γερμανία θεωρούν ότι είμαστε «διανοητικά ανάπηροι», αφού αποδεχόμαστε σχεδόν αναντίρρητα όλες αυτές τις ανοησίες; Δειλοί και φοβισμένοι ίσως ή απλά εξουδετερωμένοι, «αποβλακωμένοι» καλύτερα, από τις συνθήκες «σοκ και δέους» που προκάλεσαν, εν μέσω μίας καταιγιστικής προπαγάνδας;

    • Bravo & thank you Aristotele!
      Don’t forget that most of the time “we” were not consulted & had no choice, since MOU and the first PSI happened during an existing government (Pasok Papandreaou) and then the unelected Papademos EU place-man quisling government.

  6. Some numbers for all that believe that there is too much Austerity going on in the EU:

    Maastricht criteria = max. 3% (for problem countries temporarely lifted)

    Greece 2012 = 10%, EU Commission estimate for Greece 2012 = 6,6%

    Portugal 2012 = 6,4%, EU Commission estimate for Portugal 2012 = 5,0%

    France 2012 = 4,8%
    Spain 2012 = 10,6%
    Belgium 2012 = 3,9%
    Germany 2012 = 0,2%

    I guess we have to conclude that there is hardly any real austerity going on!

    • My dear right wing colleague: if you understood what a percentage is, then perhaps you would also understand what austerity is. Since the ridiculous policies of the Troika consist of creating a depression and reduced GDPs, then automatically (by arithmetical law) the percentages increase, ceteris paribus.

      Exactly what you think you are showing with these numbers, I really don’t know. They can mean that southern europe is not solving its debt problems, or they can mean that the Troika is not solving anything either. Take your pick (according to political ideology and country of origin). What they definitely do NOT mean is that there is insufficient austerity: only a fool could argue that.

    • @EUdSSR: ” You want the Euro? Here is a message from you new overlord:
      Angela Merkel ……….”

      EUdSSR Angela Merkel or “Madam marktkonforme Demokratie” is not the real overlord :-)

      She is just the lousy marketing assistant of her real masters:

      Destruction of Cyprus is another step towards NWO

      http://english.pravda.ru/business/finance/01-04-2013/124188-cyprus_nwo-0/

      and in Greek language the same article here:
      Η καταστροφή της Κύπρου είναι άλλο ένα βήμα προς τη “νέα παγκόσμια τάξη”

      http://kostasxan.blogspot.gr/2013/04/blog-post_8717.html?m=1

      The German media just like the Greek media are only misinforming people so they can’t see the bigger picture. And the bigger picture is called TAFTA!

  7. @EUd
    “Look what a French ex Minister says about the United States of Europe!

    “The European Union will never receive enough public support for federalism and so should abandon the idea of a United States-inspired superstate, says the influential French Socialist former minister Hubert Védrine.””

    He is talking about PUBLIC support when the truth is that they will never receive POLITICAL support. Was public ever asked to support EU federalism?

    No, Public was barely aware of real issues at hand. This is about politicians not wanting to give away some of their power to federal institutions.
    In US Civil War politicians of the south also hid from public what was the real issue, so they made it about slavaery and “state’s rights” to get support from the public.

    Federalisation of EU would mean that issue of debt would dissapear with banking union and insurance under ECB, not under individual states. This reordering would invalidate debt issues and if such question was posed to the public it would receive overwhelming support.

    The politicians are hiding the real issues from the public in the north and in the south.

  8. Pingback: Griechenland – Griechische Banker mit brutalen Mafia-Methoden | staseve

  9. “Bankruptocracy in the Greek Sector of Bailoutistan is, thus, progressing in leaps and bounds. ” well said..

    Banksters or Gangsters?
    I don’t know if Greece should leave the Euro community but Greece should get rid of the bank robbers and cleptomaniac politicians soon..

  10. @Jordan from Croatia

    1) I seriously encourage that one reads more on the MMT (Modern Monetary Theory). I suppose you could even google it these days.

    Let us avoid taking the “easy way” speaking about secrets and conspiracies; skip that, run the facts first and if it doesn’t work out then we could talk of fiction. The world isn’t run on “secrets” but it can run on “plans”. Plus, I guess you can lie about the numbers but the numbers will never lie to you.

    2) For the last 3 decades recycling capital from surplus-economies to deficit ones revolved through the EU funding programs. This kind of funding provided the South with a chance to increase its competiveness in the long run and the North with the opportunity to expand its influence and create a bigger centre of attraction in the international scene. However, it really provided the South with enough liquidity to spend more on products coming from the North; it also provided the North with a big pool of consumers. This way the South has been “dis-industrialized” and even at times of growth the economies were being based mainly on retail or real estate; the North, on the other hand, now faces its consumers’ stagnation. In any case, the Union in perspective, the main objective should have been towards fiscal integration; disregarding that this never happened, a monetary Union has been introduced and the Euro circulated. In retrospect, running different fiscal policies on one sole monetary policy is somehow dodgy… let me point out: “In this case, for every-single-one involved.”

    3) The Lagarde List is a list of names and accounts; it can only serve as a background indication on where/whom the authorities might need to further check. This sort of intelligence is no novelty; it has been around for years and years… I suppose one could argue if it is right or wrong; in any case, some do it efficiently while others don’t.

    4) Don’t think that most of the ideas presented here derive from a nationalistic, narrow-minded point of view; quite the contrary actually. Speaking for myself, my euro-scepticism is based on observation and fact and certainly not on ideology.

    5) I can sense a tone of post-war reflection in your words. I can understand that; I might also suggest that maybe you stand out in your local club defending slightly more liberal arguments as opposed to the radical nationalistic instincts quite common in the area. That said however, I would seriously encourage en even more rationalistic approach.

    PS: Robert E. Lee was a confederate military commander skilled in tactics and an iconic Southern icon. He might have been a clever guy, but calling Dean Plasaras a “Robert E. Lee” can be somehow ironic… maybe it is best to recall. After all, I do not think the European North qualifies as the modern Yankee; don’t forget, those people still pay royalties to feudal lords.

    • Very good. Yes, i am talking from the war experience i went trough allready. Yugoslavia fell appart due to the fiscal transfer issues between republics and handling oil import needed dollars causing tribal antagonisms that were boiling underneath.
      The scenario is replaying again within EU. Energy needs and fiscal transfers problem is in EU too.

      Difference was that Croatia as surplus republic wanted to have hegemon role while Serbia was deficit republic but had largest population wanted to be hegemon too. In EU, Germany does not want that role even tough there is no competitors and there is demand for such German role from other countries. But there is no hegemon in either case.

  11. Let me be clear, i am all for EU as federation, but aginst this road they are taking to achieve it because it leads to war. I am for education and then referendum as the way to do it.
    But the problem for North to educate the EU population is protection of secrets of capitalist monetary system. They are protecting those secrets at all cost.
    The secret they are protecting is that banks create money while states can do it by borrowing from the banks only.

    In order to educate they will have to divulge that secret and circuitry of money which makes deficit and surpluses a mute point. In short, capitalism will seize to exist if people knew that, so they are hiding it.

    This is the reason for back channels of publishing Laggarde list and now off-shore accounts in order to show thier intentions. But who could get to those list? Journalists? corrupt politicians in south?
    Laggarde list comes from Christine Laggarde that is aware of all capital movements trough ECB and only Germany and France could allow such list to get out in public.
    Who is able to get off-shore account list? Only intelligence agencies of major powers could get to it, and as it was known that US attorney general got them from UBS, Deutsche Bank and HSBC 3 years ago. They leaked it to that group of journalists that published it.

    I am for parallel currencies besides euro to cope with regional inability to print money, many countries in EZ has it on different scales. WIR Credit in Switzerland that handles 20% of economy. Why do you think a Swiss system is the most stable one in the world?

    • So can you give an answer… “Why did Maastricht leave a good chunk of lender-of-last-resort authority in the hands of national governments that could not print money and so fulfill the lender-of-least-resort function rather than placing all of it in the European Central Bank, which could?”

    • I said that many times. The answer is in politicians unwilingness to give up their power to the ECB.
      Just as South states did not want to give up thier power ower individual states.
      I video presentations, Yanis and many other economists mention the logic behind such limited unification; Present treaty is the most they could get consensus on at the time. They knew that such half united entity will get into problem but were hoping to be solved before the problems apear. They were wrong.

  12. As Martin Luther King Jr said, to parafrase, We have to grow ourselves trough the fight for freedom in order to deserve and then to keep such freedom.
    To grow ourselves, we have to clean our own corruption, then our politician corruption in order to go to the next step in unification into unified retirement, health, education, military, judicial and banking system. Next step is to change the EU to serve us, the people. European as a nationality is the future, wheter we do it or it will be up to a future generation that will finish it toward a human as nationality and united world.

    • Once in the EU, you are going to lose this starry eyed perspective real fast. We have all been through the phases.

      It comes down to national interest, because an economic union is not the same as geopolitical alignment.

  13. @ Alex D
    “Is there a model running at the background of your thoughts or”

    I believe that larger number of people pooling toghether its resources can collectivelly solve bigger problems.
    Is it not the history of Europe in last 1,500 years going from city states grouping to large countries and now toward a single Europe as country that can rival China, USA, India or Russia. It is the size of pooled resources that makes us competitive.

    Sure, all that developement happened through wars and thinking is that this time it won’t. It depends on us if it will or not. Can we rise to the challenge or keep to our tribal sensitivities?

  14. I am from Croatia, and Croatia is entering EU in 73 days. When the referendum about entering the EU came, i tought of it as having only one single positive reason for doing it in short and medium term. In the long term it is a must.
    That single reson for entering the EU was they will force our corruption out of the system, or at least try. I knew that because they also did this with our criminal, black market generals through Hague War crimes court. In the course of the negotiations they forced a Prime Minister out of the position who is now in trial for multiple law braking corruption and the leading party HDZ for black funds and tax avoidance.

    I believe that EU powers are doing the same with all corrupt suthern politicians, and forcing southerners to do it themselves with only means they have, economic means.

    • Your belief in the ability of the EU to clean up corruption is not justified here in Greece, where unprecedented propaganda was generated by Germany and the EU Commission to keep our corrupt political parties at any price, and negative propaganda generated against the opposition parties. In Greece’s case, Germany and the EU have been the sole protectors and upholders of our kleptocratic geriatric traditional parties.

      The same applies in Spain, Portugal, Greece, Ireland and Cyprus with only Italy escaping.

      So watch out!

    • Jordan:

      There is a big difference between joining the EU vs. the eurozone. Many countries are EU members with their own currency. However, adopting the euro has architectural problems and it’s a different ball game.

      I still don’t understand why you are calling me a Robert E. Lee. :)

  15. Dean Plassaras is providing an insight of Confederacy thinking in USA Civil War.
    Today thinking is different but even in USA such thinking is resurfacing: States rights above all. History proved them wrong even tough the price it was paid is a wash in a world outlook.

    What would you do, if you are a German who knows how corrupt the southern politicians are?

    Maybe ask criminals nicely to stop looting?
    Maybe try military force?
    Maybe try only legal means or economic means after they hide behind people?
    Maybe force the people to get rid of their own corrupt politicians by using economic means is the only peacfull mechanism they have?

    What would you do if you are a German and being aware of southern politicians corruption, of which all southerners are aware of too? How would you try to get rid of them in order to unify as all European people want?

    • Are you suggesting that the recap is merely a nobble effort to push for further reform…? Wow!

      I might fall for that if its size was several times bigger. This is not the case however; the math doesn’t add up.

      Is there a model running at the background of your thoughts or is it some political rhetoric on pseudo-European unification quoting the patriotic duties of the Yankees 150 years ago?

      You are right though on one thing; it truly qualifies as “peaceful”… and as a rip off too.

      Please read the comments below.

    • You have a great Point. for some badly run countries the EU might be a savior, but for us it is not. Moving to EU Level means going back, not forward for 95% of the things I can think of

      Here is what I have done:

      – Not voted (since May 2010) and never will vote again for any party/politician that is a EU / EURO supporter & try to influence my friends to do the same
      – Support EU /EURO sceptic parties financially & went to demonstrations against bailouts & EURO
      – Optimized my income streams (legally), so that I now pay roughly half as much taxes as in 2009. – I would rather see my sons burning the cash with hookers than see the cash move to the South
      – Turned bank savings into non-EU real estate and stocks that do not depend on EU economy too much
      – Moved majority of bank savings into non-EU bank
      – Bought gold & silver
      – Upgraded most things inside the house to get rid of cash
      – Got non EU passports for wife & kids

      What more I will/could have to do if needed:
      – Stop working – lower incomes means less taxes for nonsense government activities (e.g. sending it to the South)
      – Move outside EU

    • If the European people want to unify so much as you wrote, why then nobody bothered to ask them? Unification cannot be stuffed down one’s throat. If the people could speak I doubt the would say what the elites would want to hear.

    • I can not hear this Union crap anymore. Currency union, banking union, fiscal union… What is next? Toilet union?

    • Jordan:

      Whereas in the American Civil War the South wanted to preserve slavery, in this modern situation in Europe it is Germany that wishes to establish a slavery status on all other countries.

      Big difference! That’s why your argument about the confederacy falls apart.

    • Dean, most Germans do not give a damn what people in the ClubMed do or not do. If you would ask them, most would ot even want them as slaves, they just do not want to pay any money to them.

      Mabye forcing them to pay for the ClubMed makes some think “Why not use them as slaves then!”

    • Eud:

      My understanding is that so far German taxpayers have paid zero.

      All Germany is doing is to guarantee EU loans due to the flawed architecture of the euro. Guantees cost nothing so far. In case of default Germany might lose 17 Bil. but has already made 120 Bil. from the crisis. So in either case, for the Germans it’s a question of magnitude of profit. Germans can’t lose in this game because it has been designed as such.

    • Eud:

      In such case, since the EU is moving Germany backwards why don’t you leave and then the rest of Europe could issue eurobonds (X-Germany) and move on.

      Soros suggested it and I think it’s a “win-win”.

    • “My understanding is that so far German taxpayers have paid Zero”

      This is incorrect. (1) Germany had ist Euro crisis shortly after the Euro was introduced. Capital left the Country and went to the South and unemployment soared. (2) Germany is lending out Money at far below market interest rate (3) Germany has the negative (as everyone else) effects from the inflation that is being imposed on the Euro from the South. The Country who inflates more has the benefit, all EUR users have the cost. (4) The money going to the ESM needs to be accounted for in the ferderal budget. This means that something else is reduced or taxes increased/not lowered in order to come up with ESM money. If it had not been for the Euro crisirs Germans would have enjoyed a tax reduction in the last years!

      And finally: Do you honestly believe the South can pay back the EUR 1000+ billion incl. interest? For how many generations do you want to see Spanish university grads working at reception in Frankfurt hotels?

    • Dean “In such case, since the EU is moving Germany backwards why don’t you leave and then the rest of Europe could issue eurobonds (X-Germany) and move on.”

      Fully agree with you on this one. I would even pay money to get this result!

  16. @Kotzabasis expulsion from blog:
    When someone calls yani’s attempt to shield light on the hypocrisy of Greece’s major government figures:

    “the motivation of an assassin who readies himself to plunge a knife at the back of the Samaras’ government”

    Clearly when a person is so blinded as Mr. Kozabasis is; they really need some cold water splashed on their face to wake them out of such ridiculous like statements like what fine job the Greek gov., Moody’s (????) and Trioka are doing. Six years of negative growth and double digit unemployment. Depressions are so good for someone’s soul. It seems like the austerians have no empathy for the suffering taking place in Greece.

  17. Could I have your views on the following?

    Greek-to-big-to-fail banks need to raise capital 5-6 times bigger than their current capitalization, which controversially suggests that even if they succeed in doing so, management will flow on the hands of the HFSF and the ones controlling it. Quite honestly a 90% stake is clearly a 100% controlling interest… does anyone disagree?

    On top, the 50 b recap is a tiny fragment of what the banks truly need. A private investor is buying a share on huge premium. The HFSF is buying a share on discount (implying that their motives are questionable).

    Point made, if the worst is yet to come, would you consider that a failure in raising private capital might be a preferable thing to expect?

    Since all this is going South anyways, why not accelerate the process? Dying slowly can be at times worse than a sudden shock.

    Clearly, I cannot express an opinion yet and I am being sceptical about it; I consider however that it is always best to think of the financials as a better guide compared with politics.

    Your thoughts…

  18. Knowing how sensitive is Yanis and part of the blog here on the topics of “banktocracy”, “kleptocracy” and similar terms, let me make a point worth considering.

    Obviously the Greek state is very eager to nationalize all Greek banks. When its cost of funding from the EU is around 2% and then its forcefull lending to all banks @ 9%, this a great speculative spread that no country in Greece’s condition could refuse. The objective here is to make even more money from the Greek banks struggling to repay such expensive capital which they couldn’t even use for lending (it’s just for show).

    Having said that, I am sure that some Greek bankers are connected to the hilt and obviously such needs to be corrected for the system to function better.

    To me the real tragedy in the Greek banking sector is the National Bank of Greece, one of the most conservative and well run banks which has suffered enormous loses to “save the state”.

    Mind you both political parties(ND & PASOK) owe at least 200 Mil. each to Greek banks on loans which are best classified as “red loans”, i.e. not repayable.

    So, here is a hungry state cannibalizing itself in an effort to stay alive for the sole purpose of executing a brutal austerity program.

    I find it very ironic that some of you (including Yanis ) have expressed the opinion that de-Hellenizing the Greek banking system is a good thing.

    It could only be a good thing if the state is an honest broker (and not a greedy speculator) and only if institutions like the National Bank of Greece don’t end up in the hands of Deutsche Bank.

    Because if the only purpose of this exercise is to take the banks away from the “incompetents and corrupts” and hand them to the “vultures with even worse record” then this is a theater of impressions and of zero substance.

    Finally let me state for the record that even though I think Yanis is doing an excellent job of approaching the crisis and the required solution, the Greek banking sector is a particular topic where I feel Yanis’ emotions outrun his logic (let’s call it Yanis’ Achilles heel).

    So, high marks for the effort of exposing evil but be careful what you wish for. Because those who Yanis wants to see them punished will probably escape and new more destructive replacements will be introduced for more or less innocent banking victims. When it comes to Greek banking, generalizing is a mistake. One has to look on a case by case basis and zoom into the targets that really need correction.

    To me the recapitalization (aka the broad day light theft of the greedy state at the expense of its own economy) is as undemocratic and odious as the rest of the political malfunction we are experiencing in Greece. Not to mention 100% counter productive towards a healthy recovery.

    • I think you matched the thinking of a Confederacy president in USA Civil War. State rights above all, which are resurfacing lately in USA too.

    • I can understand where you’re basing your argument; however, it seems that something here is missing.

      (1) Greek banks will not be nationalized. They will just fall into the hands of the HFSF and the like…

      (2) If you were to run the banks (as you in part suggest) as “real banks” you’d need a much bigger recap. Those 50 b estimates are based on totally wrong assumptions; even if the Blackrock model is right, still, the input data doesn’t make any sense whatsoever. Stress case scenario assumes a 17% unemployment rate, real estate values 150% higher than the 2000 benchmark, a 16-21% loss on non performing Greek mortgages, consumer and business loans. Especially in regard of the latter, a mistake as high as 10% would mean 20 more billion for a debt book over 200 billion.

      (3) Your suggestion for a spread gain over interest rates, as cunning as that may be, is really based on thin air; there is no money to lend in the first place; it couldn’t possibly work out, even if one had the intention to.

      (4) Yannis, very correctly in my opinion, stressed the fact that it is better to have a “foreign bank” rather than a “zombie bank”.

      Put plainly: The problem here is that after the infamous recap you will have “foreign zombie banks”… or literally “zombie banks controlled by ignorant wannabe policy makers with no idea on finance on one hand and questionable motives on the other”.

    • Alex:

      Nationalization means no longer in private hands.

      As to the Blackrock report, of course it’s 2 years old and no longer applicable. That’s why Troika wants to be done with this issue. Because the longer it is delayed the more unforeseen gaps are compiled.

      But the recap does nothing to the bank’s ability to lend. Such only stems from deposits which have fled the country for good.

    • Don’t worry dean.
      If National Bank of Greece ends in Deutschebank’s hands, it will be the second time it does so. The first time was during the
      Nazi occupation. Left bankrupt when the Nazi retreated and was nationalized.

  19. It took a while, but the Greeks seem to get it! A new Public Issue poll shows that 66% of Greeks now have a “negative opinion” about the EU.

    But extraordinarily, when the same question was asked only a month ago, ‘only’ 50% of respondents said that had a negative opinion about the EU- a massive 16% increase in only a month, possibly owing to the handling of the Cypriot bailout and the renewed Troika push for civil service cuts in Greece.

    http://www.openeuropeblog.blogspot.co.uk/2013/04/public-support-for-eu-drops-by-16-in.html

  20. Yani,

    This is yet another reasson why Greece should leave the Euro or to put it more bluntly the Greek banksters together with their cleptocratic politicians are the only reason why Greece needs to stay in the Eurozone :-)

    WE NEED TO SAVE THEIR MONEY SINCE OUR MONEY ISN’T THERE ANYMORE!

    • Nailed it!

      My fear though is that our assets are still on their hands… so in order to save them we should probably send those out of here too or -since this is not doable- get the country as a whole out of this gang.

      Problem is that this requires common sense to envision and true skill to accomplish. See anyone around qualified…?

    • Το 1/3 του εισοδήματος «έφαγε» η ΤΡΟΙΚΑ

      Πτώση 8,3% σημείωσε το διαθέσιμο εισόδημα των νοικοκυριών το τελευταίο τρίμηνο του 2012, ενώ από την έναρξη της κρίσης το 2009 έχει μειωθεί κατά ένα τρίτο, σύμφωνα με στοιχεία της ΕΛΣΤΑΤ την Παρασκευή.

  21. Pingback: Greek Banksters in Action | R. M.

  22. Solution is simple! Stop paying the loans and stop borrowing credit from international banksters. Each country is in the position to create credit out of thin air backed up only by the productivity of its citizens.
    This is the way Hitler took Germany out of the economic catastrophy of the Weimar republic in only 2 years.
    It has been tried many times before:
    – by Lincoln, when he issued the “Greenbacks”,
    – it was tried in the early years of the colonisation of the US, using the “colonial scripts”.

    -it was a success-story in England for hundreds of years with the tally sticks.
    -It was a success story of the Chinese emperors who issued papermoney.

    Why aren’t university people talkning about this banker-bashing solution?????

  23. Pingback: Yanis Varoufakis: Greek Banksters in Action – On the Latest Twist in the Story of Mafia-Style Terror Spreading Through the Greek Polity « naked capitalism

  24. Well, it is not exactly news that the finance parallel universe, in all countries, is rotten to the bone. And that the players control the politicians and thus the routes taxpayer’s money takes.

    • @Very Serious Sam

      Of course you are right. This has always been happening and will keep happening in the future. It is human nature after all, I suppose.

      But there are some periods in history (e.g. like the one we are going through now) when the perpetrators are so confident that there are not going to be punished, that they are doing it in a gross, obvious and arrogant way.

      The international and local ‘Press’ does its best to distract the public’s attention.

      See, for example, what most people missed, while watching the half-mad North Korean leader threatening nuclear war:

      http://www.independent.ie/irish-news/dutch-finance-minister-amends-cork-university-degree-error-29195279.html

      Dijsselbloem, the man who is going to save the euro, has little to none experience in the field. As you can see, he specialises in ‘Dairy Economics': this is the art of milking taxpayers (preferably on the lower end of the spectrum) to save bankrupt banks.

      The Dutch press is absolutely silent about the fact that Dijsselbloem faked his CV. The only reference in Dutch language comes from Belgium and maybe from one or two personal blogs…

    • Why do you think Dijsselbloem will save the Euro? He will put us back to the DM block together with NL, AT, FI & NL

  25. Professor Varoufakis, you are spuriously using the so-called “Bankruptocracy in the Greek sector of Bailoutistan” and the populist appellation of “Cleptocracy,” to the obviously current “political establishment,” as the motivation of an ‘assassin’ who readies himself to plunge a knife at the back of the Samaras’ government.

    Why this obsession of yours to blacken and calumniate the achievements of the government in extracting from the Troika in the most difficult negotiations the prerequisites that will potentially pull Greece out of the crisis by the sterling performance of Yanis Stournaras under the strong leadership of Antonis Samaras? Why, like an ostrich you put your head in the sand and don’t see the positive assessments both of European Commissioners and politicians as well as institutions, such as Moodys, of the benign prospect that Greece by the end of 2014 will be on the trajectory of economic development? Why you don’t make a ‘peep’ about this great prospect that Greece has more than a chance to overcome its stupendous economic difficulties in the near future and thus fulfil the hopes of the people that are free from the dire prophesies of pessimistic academics and from the lachrymose political stand of Tsipras and Kamenos?

    Lastly, your last sentence, to say the least, is sinister and nefarious. It attempts and has the aim to confuse European taxpayers that their money goes to “the Greek sector of “Bailoutistan” and not for saving the country from imminent bankruptcy. You must be proud of your rust-made performance.

    • Dear Kotzabasis,

      I have enjoyed, till now, your quaint defence of your dearest Samaras, Howard, et al, for a simple reason: I do not trust my own ideology as a Left Winger. However, when you seem utterly unperturbed by clear evidence of mafia-like behaviour by those whom you have aligned with, and you respond by essentially defending them, you are stating that you are no longer a fit and proper person to be in communication with me. Until and unless you recant, and express solidarity with those of us (Vaxevanis and myself, for example) whose lives and families are threatened by certain mafiosi, you are banned from this blog. Good riddance Sir.

    • Please professor I urge you to reconsider! Mr Kotzabasis posts were unbelievably entertaining. A ray of shining light in these bleak times. His comment about the “difficult negotiations” , “sterling performance” and “strong leadership” are pure comic genius.

    • Dear Yannis,

      Please let the man speak; what one mentions clearly exhibits one’s own mere ignorance.

      Dear Kotzabasis,

      Please try to exhibit some fact-supported argument here; this is not some kind of political talk infused with rich rhetoric. It is about science and our views on political economy and financial issues. Quite honestly I am in no position to follow your thinking.

      Do you believe that Greek banking management has been efficient for the last three decades or so (even before that)? To make matters even worse, not only has it not been efficient in playing its role, it has also been corrupted to the bone. I do not know which is worse.

      Do you believe that the government’s efforts are able to pull Greece out of the crash? If you do, please explain why the figures don’t add up. This is catastrophic. You may also see my comment below and kindly consider thinking about it. Then we may all contribute our thoughts and also somehow enhance our background.

      Dear Kotzabasis,

      Please try to exhibit some fact-supported argument here; this is not some kind of political talk infused with rich rhetoric. It is about science and our views on political economy and financial issues. Quite honestly I am in no position to follow your thinking.

      Do you believe that Greek banking management has been efficient for the last three decades or so (even before that)? To make matters even worse, not only has it not been efficient in playing its role, it has also been corrupted to the bone. I do not know which is worse.

      Do you believe that the government’s efforts are able to pull Greece out of the crash? If you do, please explain why the figures don’t add up. This is catastrophic. You may also see my comment below and kindly consider thinking about it.

      Then we may all contribute our thoughts and also somehow enhance our background.

  26. I believe it is imperative that Greek justice examine this issue immediately.
    I do hope and pray that the Greek state will do whatever is necessary to protect Mr Vaxevanis.
    Both are necessary to begin to restore confidence of the Greek citizens in the rule of law!

  27. Yup… Rule of law is probably the foundation for everything. I would prefer operating a 2% profit margin in a country with efficient courts and judicious system rather than a 98% margin in a place where law does not apply or is inexistent.

    There is no asterisk, nor is there a “however”…

    However, as frightening as all this may be, still, it scares me even more the fact that very few people acknowledge that:

    (a) The 50 billion recapitalization estimate is really a joke (loads of more money needed)
    (b) If more is needed, then the 50 B kind of serves one just to get a hold on the banks’ management, without it meaning that those will be working as real banks from then on
    (c) A hold on banks’ management actually means a hold on the entire Greek asset portfolio, that is all of the Greek businesses and property
    (d) Set the property aside, stagnation and Greek business asset execution (whatever is left anyway) leads to further stagnation… and that would probably mean that no property would eventually survive

    So I suppose it is a matter of how one sees it: Is the 50 billion really a discount or is it an unfair premium for something that needs far more to operate in real terms?

    Anyhow, in regard of the letter… I think we all get who those people are. It is yesterday’s news that no one still cares to acknowledge. Vaxevanis has a point; Yannis as well. Again though, a “however”…

    However, still, we must agree that the Lagarde List would merely serve as an “indicative lead” and that it is not “evidence” per se. I am not implying anything; for what it worths, many tried to conceal it anyhow and should come justice.

    • The 50 Bil. recap is a joke. This is not money for lending out; it’s simply to restore some artificial safety ratios (for set aside “just in case” capital). Such ratios are both artificial and arbitrary as well as they do nothing to the banks’ ability to lend.

      The only source of lending are deposits and due to the Grexit terror scenario (overplayed by Berlin and collaborators numerous times) 90 Bil. of deposits have permanently left the country.

      The government says that of the 90 Bil fled deposits about 15 have returned but now we have more than 70 Bil. of additional red (non-performing) loans to consider. This is on top of 2 PSI haircuts which saw the private lose a combined 145 Bil. euro for no good reason since the total Greek sovereign debt is already hovering at 350 Bil. euros (the pre-PSI figure).

      Therefore the recap is nothing more than a theatrical move by Troika and the pseudo-government to give the false impression that some lending would occur afterwards.

      When the government as a recap mechanism requires the banks to issue Cocos at 9% interest cost, it means that all banks need to engage in new lending producing higher interest rates than the break even 9%. We are now talking 12% interest rates or above need to payoff the government “help” (aka usury type lending). When banks are forced to lend at high interest rates to pay for their re-cap it means that all new lending is very risky.

      In other words, the purpose of the recap defeats the very objective of stabilizing the Greek banking system. Quite the opposite is the truth

  28. Let’s assume that all these are 100% true. The Bank is falling apart, the Cleptocrats and their media rule the country, etc.. Who and how this country will take this country to the right track? I am ready to hear any name and and any theory that stands to logic, outside of conspiracy theories, based on a business like “western” style economy and society. We are fed-up of stories. We need to hear complete and constructive proposals. We know that our country is a piece of sh…. Let’s look forward and have a S.M.A.R.T. plan and why not with names of those who will make it happen. Enough with scenarios for movies even if they are real stories.

  29. I wish we had that kind of journalists in Portugal. The great majority is pro establishment, so our banksters don’t have to get their hands dirty.

  30. Interesting situation.

    When Iceland was on the verge of collapse because their bankers were insane, the country managed to wrestle control of the banks away from the insane banksters. It has been less successful in prosecuting them, but they no longer control the banks.

    Is it impossible for Greece/Greeks to do the same thing.

    It involves bringing in the police and removing the top couple of layers of management and putting someone else in control until the bank can rebuild a board and top management. This may involve only a few dozen people in each bank. A small jail could be built for these people on a cold mountain somewhere where they could languish until the judicial system got around to looking at their cases. Minimum 30 years before any case comes up for trial may be about right.

    After 4 or 5 banks, the rest ofGreece would catch on.

    After 4 or 5 countries, the rest of the world would catch on.

    In the case of the US, the number of layers that would have to be removed is somewhat larger.

    In each country, the top few layers of the regulator would have to go as well. One political level, 2 or 3 layers within the regulator.

  31. Great writing. Now we have the evidence of the unlimited methods banks have to create funds out of nothing and of their methods to suppress opposition. I am so grateful to the brave journalists revealing these scams. In my feeling the network of banks includes hundreds of ‘economists’ and university professors who are in denial of the reality and support the establishment with numbers and theories; smoke curtains hiding the truth about fractional banking.

  32. This degree of state complicity in corruption involving the private sector is actually far more insidious and dangerous than anything Tsochatzopoulos did. Moreover the coverup by the Greek mainstream media shows clearly that Greece has no independent media; and the entire scenario proves beyond a shadow of doubt that there is no rule of law in Greece. With this corrupt mob of criminals running the country, Greece doesn’t stand a chance.

  33. A truly disturbing piece of journalism. Whilst not unique in this regard, the Greek cleptocracy and the utter lack of accountability have bought an already vunerable nation economically and socially to it knees. Yiannis, the conundrum is how can Greece implement measures to create an accountable government structure without external influence given the ignominious failure to date of the domestic apparatchiks.

    • I should think so. And Provopoulos (now governor Bank of Greece) its ex-CEO.

    • I used deductive reasoning, because Vaxevanis said it’s not the National Bank of Greece and it’s a bank that bought the Post Bank. So it’s not Alpha or Eurobank either. Makes sense?

    • The Reuters piece speaks about Piraeus bank and mr Salas its CEO. The rest of the cast by deductive reasoning are: Mr Lavrentidis, now imprisoned, as the then owner of Proton bank that had to be bailed out in a hurry by the Greek state at the expense of its idiot citizens and Marfin-Egnatia bank, its owner significantly cleverer having jumped the sinking ship at the right time. You know, actually one could make a very nice movie out of the whole mess.

    • Piraeus is on autopilot along with a morphine liquidity drip, just as the rest of the banks in Greece. Deepening recesion, rising unemployment , increasing number of NPLs are making nobody any favors. The bankers of course are doing allright. They are getting payed on time.

    • @Guest
      A classic indeed. Though in our times unfortunately I do not see any heroes like the few that fought in the 60s and 70s for democracy in this country. In “Z” honest people in crucial institutions like the press and the judiciary system fought and lost. Nowadays it seems the corruption of said institutions is so complete that there is not even the need of a cover up. Why should there be? What is the chance of a serious investigation? Zero.

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