Greece To Immediately Sell All Assets

jlancaster

jlancaster

"LONDON (MarketWatch) — Greece will immediately sell its stakes in TT Hellenic Postbank and telecom provider OTE, as well as in ports and other assets as part of a 50 billion euro ($70 billion) privatization plan to try to meet deficit-reduction targets, Finance Minister George Papaconstantinou said Monday.

Following a lengthy cabinet meeting, Papaconstantinou, in a statement, said the government would sell stakes in the postal savings bank, the telecom provider, the Athens and Thessaloniki ports and the Thessaloniki water company.

The cabinet also “reaffirmed its determination” to continue its deficit-reduction program by taking additional measures worth more than €6 billion, or 2.8% of GDP, to meet its 2011 deficit target of 7.5% of GDP, according to Papaconstantinou.

He said Greece would set up a sovereign-wealth fund to serve as a holding company for state assets and real-estate holdings.

Greek and other peripheral bond yields soared and the euro dropped to its lowest level against the dollar since March earlier Monday. Fitch Ratings on Friday downgraded Greece’s sovereign-debt rating further into junk territory, while Standard & Poor’s warned it could eventually cut Italy’s credit rating. Read more about how Italy and Span retrigger sovereign-debt fears.

Spanish election results also weighed on markets. A defeat for the ruling Socialist party in weekend regional elections was viewed as a backlash against austerity measures.

The euro EURUSD -0.5449% later trimmed losses to change hands at $1.4032 in recent action, a decline of 0.5% from Friday."

IMO this is a bad move long term. Thoughts?
 
This is the end game for failed socialists liberal countries. The EU is soo f*cked...and we are trying our best to become like them, so the US may be doing this as well in the future.
 
Quote from Stok:

This is the end game for failed socialists liberal countries. The EU is soo f*cked...and we are trying our best to become like them, so the US may be doing this as well in the future.
More...

This is all true.
 
The problem is they're stuck in the Euro when they need a flexible exchange rate. Also it would be nice if people paid their taxes instead of buying green tarps to hide their pools.
 
Quote from Stok:

This is the end game for failed socialists liberal countries. The EU is soo f*cked...and we are trying our best to become like them, so the US may be doing this as well in the future.
More...

The US will have two options: default or debasement with attendant hyperinflation. Greece has no Bernanke Printing Press, so they(Greece) will get this over quickly. It will be more drawn out in USA and potentially more deadly.
 
Quote from Covertibility:

The problem is they're stuck in the Euro when they need a flexible exchange rate. Also it would be nice if people paid their taxes instead of buying green tarps to hide their pools.
More...

"ATHENS—Greece has one apparently simple option for reining in a budget deficit that has roiled financial markets: Clamp down on widespread tax evasion, which costs the country an estimated €15 billion ($20.5 billion) a year, an amount that would pay off a big chunk of the budget deficit. "

http://online.wsj.com/article/SB10001424052748704182004575055473233674214.html

Those sneakey Greeks!!!

Makes one wonder if the Greek people are evading taxes (1) out of convenience and because it is easy or (2) because they don't like what the government is doing with their money and because it is easy.
 
Not defending the lawbreakers, nor am I in favor of higher taxes, but catching the cheats may have an even more detrimental effect on the economy than simply raising taxes. Chasing down and punishing lawbreakers costs money and resources. Raising taxes might cost less. Regardless, anything they do will drag their economy even more, which'll ramp up various social spending, which'll put them even further behind.

Sucks to be Greece.
 
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