According to them the 110 billion euro loan granted to Greece by the EUnion and the IMF has been made 'junior' to existing loans from (pre-dominantly) commercial banks.
That means that, over the next couple of years, the idiot banks that loaned bankrupt Greece money will get their money back. And then, when Greece runs out of cash again, we'll be left holding the bag (along with Germany and the rest of the folks who bailed Greece out).Having had some experience in witnessing the EUnion process I totally believe this was intentional. This is a bail-out of Greece PLUS the banks holding too much Greek paper. This is the EUnion redistributing national incomes.
In any normal financing, the lender of last resort would be SENIOR to all existing debt. It would get its money back first, before the other idiots got a penny.
In the Greece bailout, however, the new money we're putting in will be going right out the door to pay off existing lenders who would have lost their shirts. And if the Greece austerity measures don't work and there's nothing left for us? Tough.
As soon as Greece gets its money, the banks will be paid off. And then, all of a sudden, the 'colleagues' will decide a restructuring of Greek debt is in order. Restructuring debts is a euphemism for not paying the debt (partly or in whole). Which would mean the money handed over by Merkel and our own Finance minster Jan-Kees de Jager (p), your money, will disappear into the black hole that is de Greek government budget. The markets won't give a damn because no party, other then the IMF and EUnion member states are affected. The only thing that will have gone missing is tax money. But hey, tax money is free money, isn't it?
Angela Merkel bleating that the Greek crisis could spell the end of the EUnion (NL; Oh, how I wish...) is all sound and fury. The EUnion has decided it will use tax money to keep the Euro-zone together. And we all will have the (questionable) privilege of paying through the nose so the colleagues may have their shiny single currency.
And how much do we pay, you may ask. Well, from a nice overview linked to in the same piece we learn the cost per household for each country participating in the Greek bail-out. Through this link we learn that the Germans get off rather cheaply at 'only' 565 euros per household. Our little damp corner of the world did not get such a great deal. Every Dutch household will be made to cough up 657 euros. And in the immediate future we still have Spain and Portugal to look forward to.
Could somebody please ask out Finance minister Jan-Kees de Jager what the hell he was thinking agreeing to this gross injustice? Will any of our parliamentarians make life even just a little uncomfortable for de Jager in the upcoming session of Second Chamber?
(picture courtesy of Coontje's Fotoneuq)
Brussels Journal: The Euro Crisis: The Insolvent Are Expected to Bail Out the Bankrupt
The Belmont Club: That’s the Way You Do It
[UPDATE001] And hop, there it is: MPs back Greece bail-out plan. Finance minister Jan-Kees de Jager maintains there is a virtual certainty the 'loan' of 4.8 billion euros will be repaid in full. Moreover, he denied the IMF and EUnion loans are junior to other loans. Which leaves us with a question: Is Business Insider wrong, or is de Jager *gasp* lying? For the moment I'm going with the working hypothesis that this afternoon we threw away 4.8 billion of OUR money down a bottomless well. Money, that I think would've been better spent had the government bought out positions in Greek paper of Dutch banks.