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1 year ago

Greece Kicking the can up the hill!

Marathon talks end  NO GREXIT with the can kicked 50 billion euro’s.

Seventeen hours of talks over the weekend, Greece and the EU have reached an ‘agreement’ with Germany’s Merkel on side. The deal consists of a series of tougher austerity measures that were rejected by the Greek population a week earlier. This has ended a week of rumour and volatility based on the stand off between the Euro and now leaves the Greek PM to tread a narrow path. Defeated, Tsipras has 3 days go back to his Parliament and get the final approval with a deadline on Wednesday.
This is required in order to start discussions for the third bailout at the cost of a 50 billion euro fund and democracy.

The euro dream costs 50 billion euro

The major highlight of the agreement has been the creation of a 50 billion euro fund of Greek assets to be monetized in order to solidify Greek finances and make sure that country’s debt become sustainable in the future. This is expected to come from asset sales. Half of this mount will serve to re capitalise Greek banks, 12.5 billion euro will be used to reduce country’s debt and the remaining 12.5 billion euro will be invested to kick start economic growth.

Greece will vote on Wednesday to formalise an agreement before July 19. Greece should pay 3.5 billion euro to the ECB by July 20th.  If the Greek Parliament could agree on prior actions by Wednesday, the ECB should push back the repayment deadline, keeping Greece away from default at least in the shortest term.

Here’s what they said.

There will not be a ‘Grexit’,” said European Commission chief Jean-Claude Juncker, referring to the widespread fear that if there had been no deal, Greece could have crashed out of the euro.

“The road will be long, and judging by the negotiations tonight, difficult,” German Chancellor Angela Merkel said.

French President Francois Hollande said the agreement had allowed Europe to “preserve integrity and solidarity”.

Greece’s banks remain shut and capital controls will remain in place when they reopen, as soon as this week if there’s a deal, Economy Minister George Stathakis told Mega TV.

The deal on offer is “clearly harsher than what Greece rejected in the referendum last weekend,” Finnish Finance Minister Alex Stubb told reporters as the leaders talks began. “It’s a rather black and white choice.”

Here’s what happened.

European stocks surged on the open with the EuroStoxx 50 jumping 1.44%.
Elsewhere the German DAX, CAC 40 in France and FTSE 100 in the UK are higher by 1.13%, 1.51% and 0.76% respectively.

The 30 minute Euro is unsure

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Gary Burton