The U.S. economy actually contracted, not grew as reported by the government in the first quarter as abysmal trade data comes out today. The trade deficit climbed in March to its highest level since 2008. The upside is miraculously Wall Street will continue hitting record numbers courtesy of Fed pumping.
First the Greek government blamed Germany for its ailing economy citing criminal acts perpetrated against Greece and its citizens by Nazi Germany in the second world war. If at first you don’t succeed, then try and try again. Now, the new government is blaming EU creditors for failing to achieve a breakthrough in bailout talks. Greece maintains a deal won’t be possible until all parties involved agree on a common set of demands.
As Greek bonds and stocks tumble on Tuesday one Greek official said that its creditors are confronting the country with too many red lines and need to better coordinate their message. The EU and IMF have actually been very clear in their demands that Greece make real changes to strengthen the nations economy and pay its debt. The IMF refuses to compromise on labor deregulation and pension reforms while the EU demands Greece meet its fiscal obligations. The commission stated it will not write down debt. It shouldn’t be difficult for Athens to understand that its creditors simply want to be repaid.
German Finance Minister Wolfgang Schaeuble said he doubted whether a deal could be reached by the May 11, scheduled Eurogroup meeting. Despite efforts by Prime Minister Tsipras to gain sympathy from Germany’s Angela Merkel, Greece finds itself in a desperate situation acknowledging it cannot fulfill its debt obligations to the IMF on May 12, unless its gets cash.
In an act of appeasement Athens said it was ready to finalize a 1.2 billion euro deal with German operator Fraport to run regional airports and to reopen bidding for a majority stake in the port of Piraeus. Despite these efforts the commission slashed its forecast for Greek economic growth to 0.5 percent from an expected 2.5 percent three months ago. After 3-1/2 months of name calling and negotiating, Greece and its creditors remain in the same positions as when talks began.
Greece cannot repay its debt unless EU creditors lend the nation more money, so Greece can then repay its debt. Makes perfect sense doesn’t it?
Maybe Greece figures if the principle of perpetual debt works in the U.S. it’s bound to work for them as well.
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