Greece Outside In: 06/12/15

Friday, June 12, 2015

Five Things Everyone Will Be Talking About Today

... Merkel stepped up to the podium to deliver a speech in Berlin, the audience was probably expecting a headline on Greece not the single currency.

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Eurozone Raises Specter of Default as Pressure Mounts on Greece

Senior officials from all 19 eurozone countries have jointly discussed the possibility of a Greek default for the first time, in a sign of mounting pressure as Athens seeks to unlock desperately needed bailout funds.

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Greece and the Eurozone: Politics Trump Economics

Greece and the Eurozone will find a way through this latest trouble. A Greek exit would create a nightmare for Greeks, with bank runs, capital controls, further economic contraction and dislocation. Crossing the threshold of a Euro exit could also threaten the economic stability of other financially stressed European countries, as well as jeopardize repayment on hundreds of millions of debt repayments. Both sides have an interest avoiding a Greek Exit, so odds are they will find a compromise. These are the thoughts that keep coming to my mind as Greece edges ever closer to a default. As reasonable as they sound, as a former diplomat I have seen time and time again that economic rationality and self-interest are often trumped by politics and populist thinking. And right now it's the politics, not the economics, which are driving the outcome. In Athens, the radical left government is in an impossible situation: Greeks overwhelmingly want to stay in the Eurozone but reject any further austerity program lorded over them by creditors. On the other side, European creditors face "bailout fatigue" from their taxpayers, and are politically unable to foot the bill for any further bailouts not accompanied by a strong dose of fiscal and structural reform medicine. Greece's natural allies, like Spain and Italy, who have faced their own political problems with austerity, are also no longer sympathetic now that they are at risk from being flanked politically by populist left movements in their own countries. So what happens next? As no one wants to be blamed for a Greek exit and all the problems that will go with it, there will continue to be a flurry of diplomatic activity to find a compromise. However, even if Greece and its creditors can hold their noses and hammer out an agreement that gets them through the next round of significant repayments, it is hard to imagine, given the fundamentally different philosophies on how to restore economic health to Greece, that the two sides will be able to negotiate a new bailout program that would be politically sustainable over the medium term. Unless European creditors look the other way or accept some "smoke and mirrors" with respect to further fiscal adjustments to accommodate debt service payments, at some point, the Greek government will face a choice of either making debt payments or paying salaries and pensions and keeping the hospitals running and the lights on. The government will -- out of political self-preservation -- choose the latter and de facto default or the government will collapse. At that point, the European Central Bank will find it very difficult to continue propping up Greece by financing its bank debt collateralized by government bonds. This will very quickly create a liquidity crisis for the banks and for the government. A run on banks, and the imposition of capital controls, will likely follow. Because of the overwhelming support for remaining in the Eurozone, Greece will likely struggle for as long as possible with capital controls to avoid moving back to the Drachma. But as the economic situation rapidly deteriorates, at some point, the economic pain and dislocation and the mountain of debt still hanging over the country will likely force a future government to manage the transition back to the Drachma. It remains to be seen whether new elections could bring in a more centrist coalition government willing to impose more stringent fiscal reforms to support a new agreement that would unlock new financial flows and a debt restructuring. However, it is a long shot as there is little support for further austerity in Greece across the political spectrum and the political system is becoming more fractionalized. The sad part is this: an offer to dramatically reduce Greece's debt to a still significant but sustainable level could be the key sweetener to help the current government swallow the bitter medicine needed to keep the bailout on track. But politics in creditor countries won't allow that - and inevitably we will have to watch the painful story unfold with all the human consequences it entails. In the end, economics will get the last laugh over politics, but it will be at everyone's expense. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

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Greek state broadcaster ERT on air again after two years in the dark

Athens: Employees at Greece's state television ERT hugged each other and cried on Thursday as the channel aired its first broadcast in two years, after it was shut down under one of the previous government's most drastic austerity measures. Leftist Prime ...

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Israel is Perceived by Expats as the Most Dynamic Country Worldwide

Yes, you read it right; Israel was rated by expats as the most dynamic country in the world. It even left the USA and Brazil, countries widely known for their fast and energetic culture, far behind. I bet you were not expecting this, right?Well, you are probably not the only one. Needless to say, the images we see on TV of conflict in the region do not give the impression of a dynamic country at all. However, this is only half of the story, according to expats living in Israel.When you are planning a move abroad, the nature of the local population is an important factor to consider. This can vary drastically depending on what country or region you live in, and whether you are in an urban or rural environment. Your ability to settle in may depend heavily on how comfortable you feel in your new environment and culture. If you consider yourself to be a very rational person, not given much to displays of emotion or outbursts of passion, you might struggle to feel 'at home' in an openly emotional culture, for example. Expats from all over the world were asked by InterNations, the largest network for people who work and live abroad, to give their perceptions of the local population in their respective destination. Survey participants were asked to rate whether they found their neighbors to be more traditional or dynamic, as well as, whether they tend to be more emotional or rational. The outcomes of this research can easily be examined through a series of psychographic positioning charts, based on several geographic regions. Israel's surprising result even surpasses the border of this chart! Keep in mind though, that these results are based entirely on the perception of the expats. It is quite possible that one person would view the local population as very traditional, whereas another person could see them at the other end of the spectrum.Click image to enlargeIsrael was not the only country that stood out. Brazil, for example, which is one of the world's emerging markets, ranks almost as highly as the USA on the dynamic scale. Interestingly, however, no other member of the emerging BRIC countries (China, India and Russia) even came close to Brazil in terms of their perceived dynamism. If a dynamic environment is something that you value strongly, moving to Brazil or Israel might be the best option for you. Click image to enlargeAcross the Atlantic, the African continent shows an interesting divide. Most African countries are perceived by expats to be quite traditional, but Nigeria in the west, Kenya in the east, and South Africa on the cape distinguish themselves prominently by standing out for their dynamic development. This result might not come as a surprise, seeing as these three countries are indeed Africa's fastest-growing regional hubs. The diversity of Africa makes it an exciting destination for all kinds of expats. Click image to enlargeThe results from the European continent offer nothing shocking: Expats perceive the north of Europe as more rational and distant and the south of Europe as more emotional and friendly. If you feel most comfortable surrounded by rational people, why not consider moving to the north of Europe? Germany, Switzerland, Norway and Finland might make you feel at home fast. Are you more an emotional person? Then, Spain or Greece may suit you better. This divide between the north and the south holds true for the American continent as well. Click image to enlargeFor those seeking a new home that highly values tradition, Myanmar could be a good fit for you since it is considered by expats to be the most traditional country in the world. Angola, Kazakhstan and Slovakia also saw high results in this regard.The surprising outcomes of the study teach us to look beyond the stereotypes in our head and the images seen on TV. Preconceived notions are not something that you should take with you when you move abroad. These are not always correct and you will either be in for a pleasant surprise or a rude awakening when you get there. It is important, however, to research the place that you are moving to beforehand in order to familiarize yourself with the environment that you are about to step into. An easy way to do this is by searching for expat-related information on platforms such as the InterNations Guide Section. On the other hand, it is equally, if not more, important to keep an open mind and be willing to experience new things and broaden your horizons. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

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WRAPUP 5-EU holds first talks on Greek default as Athens holds out hope

(Adds Greek denial, new talks in Brussels). * Athens denies default was discussed. * Merkel says "where there's a will there's a way". * Greece ...

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STOCKS FALL: Here's what you need to know (SPY, DJI, IXIC, USO, WTI, OIL, VDE, TWTR, WING, ESI, LL)

Stocks finished lower to end a week that saw more shaky headlines out of Greece. Gold, crude oil, and the dollar also edged lower on Friday. First, the scoreboard: Dow: 17,886.29, -153.08, (-0.85%) S&P 500: 2,092.94, -15.92, (-0.75%) Nasdaq: 5,050.64, -31.87, (-0.63%) And now, the top stories on Friday: Twitter shares halted a rally that began in after-hours trading on Thursday when the company announced CEO Dick Costolo is stepping down. The stock surged more than 7% after the close, and opened about 3% higher in early trading. But just after 1 p.m., the stock went red, although it gained by about 0.5% in the final hour of trading. Wall Street isn't so sure about Jack Dorsey, the interim CEO from July 1. In research notes on Friday, several analysts expressed concern that the company may continue to underperform. However, there were no big changes to their price targets or ratings of the stock. Macquarie analysts wrote, "the surprise timing of this announcement, combined with the "steady-as-she-goes" tone of the executives on the conference call, indicate to us that TWTR will continue to underperform until it can either a) significantly improve its execution against its current strategy, or b) institute a new vision." Business Insider's Henry Blodget notes that the whole plan for an "interim CEO" is pretty much a sham. There's a 'Plan B' for Greece. According to Reuters, senior EU officials formally discussed, for the first time, the possibility that Greece will default on its debt. This follows the IMF's abandonment of talks with Greek officials on Thursday. "The discussion was very theoretical because the scenario of a eurozone country defaulting within the currency union would be without precedent," Reuters reported. The US oil rig count fell for a 27th straight week. Data from driller Baker Hughes showed that the number of active US oil rigs fell by seven to 635 this week, the lowest since August 6, 2010. The combined count fell by nine to 859. West Texas Intermediate crude oil was lower for much of Friday, dipping to as low as $59.75 per barrel. US oil production continues to surge, although the Energy Information Administration forecasts a slowdown from June until next February. In economic data, the preliminary reading of the University of Michigan's consumer sentiment index for June jumped to 94.6, crushing the forecast for 91.2. This was the first time in three months that the index rose. In the release, the index's chief economist Richard Curtin wrote, "The June gain was due to the most favorable personal financial prospects since 2007, with households expecting the largest wage gains since 2008." Producer prices posted the biggest month-over-month gain since 2012 in May. The Producer Price Index rose 0.5% month-over-month and fell 1.1% year-over-year. Excluding food and energy, core PPI rose 0.1% and 0.6% respectively. A 15.6% spike in fuel prices accounted for three-quarters of the increase. Chicken wings chain Wingstop surged 60% in its public market debut. The chicken wings chain priced had priced its shares at $19, higher than the previously indicated range of between $16 and $18 a share. The stock rose to as high as $31 per share, valuing the company at around $880 million. Wingstop had $8.9 million in profits last year, according to its IPO filing. As at December 2014, it reported 712 restaurants across 36 states and 6 countries. Wingstop joins Bojangles, El Pollo Loco and Shake Shack among restaurant chains that have gone public in the past year. Shares of for-profit college ITT Educational spiked 30% following a quarterly earnings report filed one month late. The company is struggling financially, and is under investigation for fraud charges by the SEC; it allegedly hid the poor performance and financial impact of two student loan programs from its auditor. Earnings jumped to $10.4 million, or 44 cents a share in the quarter – reflecting lower expenses. "This is the dumbest rumor ever," wrote hedge fund manager Whitney Tilson on chatter that Home Depot seeks to acquire Lumber Liquidators, whose shares jumped 12%. The hardwood flooring retailer has been rattled by allegations that its flooring sourced in China contains excessive levels of formaldehyde. Tilson wrote, in an email, that Lumber Liquidators may only be an acquisition target two years from now, when the legal liabilities have faded. The company declined comment. DON'T MISS: One of corporate America's most controversial practices could become a major issue in the 2016 election »Join the conversation about this story » NOW WATCH: Forget the Apple Watch — here's the new watch everyone on Wall Street wants

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Greek Banks Can't Pull Out Capital From Macedonia

Greek bank owners with assets in the Republic of Macedonia can't pull out their capital unless they offer their holdings for sale, the former Yugoslav ...

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Greek President to visit Berlin on July 7

Close aides of President of the Hellenic Republic Prokopis Pavlopoulos confirmed to ANA-MPA, on Friday, a report by German news agency DPA that the Greek president plans to visit Berlin on July 7. However, they clarified that the details of his visit ...

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Greece Readies Proposals To Break Troika Impasse

Greece said June 12 it will present its creditors with new proposals over the weekend in an attempt to breathe life into stalled bailout discussions that have stoked fears of the country's bankruptcy. The post Greece Readies Proposals To Break Troika Impasse appeared first on The National Herald.

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Greek Lessons From The Marshall Plan

Greece, which can look back on thousands of years of history, can look to 1947 and the Marshall Plan that rebuilt Europe to save itself. The post Greek Lessons From The Marshall Plan appeared first on The National Herald.

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EU looks at Plan B for Greece

Greece owes €1.6 billion in bundled payments to the IMF on June 30. ... before the extension to Greece's second bailout package expires at the end of ...

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Germans increasingly resigned to Grexit

Merkel remains publicly committed to a deal with Greece but doubts are growing among top officials

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NATO Warsaw Summit Should Invite Macedonia, Montenegro to Join

NATO should invite Macedonia and Montenegro to join when it holds its next summit in Poland in July of next year, Polish Defence Minister Tomasz Siemoniak has said. "It would be excellent news if the invitations could be sent from (the NATO summit in) Warsaw to Macedonia and Montenegro," Reuters quoted Siemoniak as saying at a conference in Wroclaw, Poland on Friday. According to Siemoniak, if “deprived of this element”, the summit “will not bring full satisfaction to many nations, including Poland." The two southeast European states both want to join the Western military alliance, of which their regional neighbours Albania, Bulgaria, Croatia, Greece, Slovenia and Romania are already part. An invitation to join NATO is likely to meet strong opposition from Moscow which has perceived the bloc’s eastward expansion since the end of the Cold war as a threat to Russia’s security. Russia’s Foreign Minister Sergei Lavrov said last year that NATO’s Balkan expansion to Macedonia and Montenegro could be seen as a provocation. Siemoniak spoke a day after NATO Secretary-General Jens Stoltenberg said that Montenegro will have to increase its public support for NATO and strengthen the rule of law before it can join the alliance. According to opinion polls, public support for NATO has never exceeded 40 percent in the country which is deeply divided between its traditional links with Russia and aspirations to become member of the alliance, AP said. Speaking after meeting Montenegro’s Prime Minister Milo Djukanovic in Podgorica, Stoltenberg said that Montenegro's membership bid is in "the crucial phase". “We re-confirm that we are ready to make the decision by the end of the year at our foreign ministerial meeting in December,” Stoltenberg said.

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Waste management contract signed in Western Macedonia

Athens-listed Ellaktor SA announced on Thursday that special purpose vehicle EPADYM had signed a partnership contract and the relevant financing agreement regarding a waste management project in Western Macedonia, northern Greece.