Greece's bailout expires, country defaults on IMF payment

[webfact]

Greece's bailout expires, country defaults on IMF payment
By ELENA BECATOROS and DEREK GATOPOULOS

ATHENS, Greece (AP) — Greece slipped deeper into its financial abyss after the bailout program it has relied on for five years expired at midnight Tuesday and the country failed to repay a loan due to the International Monetary Fund, deepening fears over whether it will be able to remain in the eurozone.

With its failure to repay the roughly 1.6 billion euros ($1.8 billion) to the IMF, Greece became the first developed country to fall into arrears on payments to the fund. The last country to do so was Zimbabwe in 2001.

After Greece made a last-ditch effort to extend its bailout, eurozone finance ministers decided in a teleconference late Tuesday night that there was no way they could reach a deal before the deadline.

"It would be crazy to extend the program," said Dutch Finance Minister Jeroen Dijsselbloem, who heads the eurozone finance ministers' body known as the eurogroup. "So that cannot happen and will not happen."

"The program expires tonight," Dijsselbloem said.

The brinkmanship that has characterized Greece's bailout negotiations with its European creditors and the IMF rose several notches over the weekend, when Prime Minister Alexis Tsipras announced he would put a deal proposal by creditors to a referendum on Sunday and urged a "No" vote.

The move increased fears the country could soon fall out of the euro currency bloc and Greeks rushed to pull money out of ATMs, leading the government to shutter its banks Monday and impose restrictions on banking transactions for at least a week. Greeks are now limited to ATM withdrawals of 60 euros ($67) a day and cannot send money abroad or make international payments without special permission.

But in a surprise move late Tuesday, Deputy Prime Minister Yannis Dragasakis hinted that the government might be open to calling off the popular vote, saying it was a political decision.

The government decided on the referendum, he said on state television, "and it can make a decision on something else." It was unclear, however, how that would be possible as Parliament has already voted for it to go ahead.

With its economy teetering on the brink, Greece suffered its second sovereign downgrade in as many days when the Fitch ratings agency lowered it further into junk status, to just one notch above the level where it considers default inevitable.

The agency said the breakdown of negotiations "has significantly increased the risk that Greece will not be able to honor its debt obligations in the coming months, including bonds held by the private sector."

Fitch said it now considered a default on privately-held debt "probable."

Hopes for an 11th-hour deal were raised when the Greek side announced it had submitted a new proposal Tuesday afternoon, and the eurozone's 19 finance ministers held a teleconference to discuss it.

But those hopes were quickly dashed.

German Chancellor Angela Merkel said she ruled out further negotiations with Greece before Sunday's popular vote on whether to accept creditors' demands for budget reforms.

"Before the planned referendum is carried out, we will not negotiate over anything new," the dpa news agency quoted Merkel as saying.

Greece's latest offer involved a proposal to tap Europe's bailout fund — the so-called European Stability Mechanism, a pot of money set up after Greece's rescue programs to help countries in need.

Tsipras' office said the proposal was "for the full coverage of (Greece's) financing needs with the simultaneous restructuring of the debt." It did not provide details.

Dijsselbloem said the finance ministers would "study that request as we should" and that they would hold another conference call Wednesday.

Dragasakis, the Greek deputy prime minister, said the country's new proposal "narrows the differences further."

"We are making an additional effort," he said. "There are six points where this effort can be made. I don't want to get into specifics. But it includes pensions and labor issues."

European officials and Greek opposition parties have been adamant that a "No" vote on Sunday will mean Greece will leave the euro and possibly even the EU.

The government says this is scaremongering, and that a rejection of creditor demands will mean the country is in a better negotiating position.

In Athens, more than 10,000 "Yes" vote supporters gathered outside parliament despite a thunderstorm, chanting "Europe! Europe!"

Most huddled under umbrellas, including Athens resident Sofia Matthaiou.

"I don't know if we'll get a deal. But we have to press them to see reason," she said, referring to the government. "The creditors need to water down their positions too."

The protest came a day after thousands of government supporters advocating a "No" vote held a similar demonstration.

On Monday, European Commission President Jean-Claude Juncker made a new offer to Greece. Under that proposal, Tsipras would need to accept the creditors' proposal that was on the table last weekend. He would also have to change his position on Sunday's referendum.

Commission spokesman Margaritis Schinas said the offer would also involve unspecified discussions on Athens's massive debt load of over 300 billion euros, or around 180 percent of GDP. The Greek side has long called for debt relief, saying its mountainous debt is unsustainable.

A Greek government official said Tsipras had spoken earlier in the day with Juncker, European Central Bank chief Mario Draghi and European Parliament president Martin Schulz.

Meanwhile, missing the IMF payment means Greece is cut off from new loans from the organization. And with its bailout program expiring, Greece will lose access to more than 16 billion euros ($18 billion) in financial support it has not yet tapped.

On the streets of Athens, long lines formed again at ATM machines as Greeks struggled with the new restrictions on banking transactions.

The elderly have been hit particularly hard, with tens of thousands of pensions unpaid as of Tuesday afternoon. Many also found themselves completely cut off from any cash as they do not have bank cards.

The finance ministry said it would open about 1,000 bank branches across the country for three days beginning Wednesday to allow pensioners without bank cards to make withdrawals. But the limit would be set at 120 euros for the whole week.
____

Raf Casert in Brussels, Geir Moulson in Berlin and Paul Wiseman in Washington contributed to this report.


-- (c) Associated Press 2015-07-01

[ezzra]

This morning headlines in an Aussie newspaper,,,, ACROPALYPSE NOW.... I thought it funny and apt...

[Anthony5]

But in a surprise move late Tuesday, Deputy Prime Minister Yannis Dragasakis hinted that the government might be open to calling off the popular vote, saying it was a political decision.

The government decided on the referendum, he said on state television, "and it can make a decision on something else." It was unclear, however, how that would be possible as Parliament has already voted for it to go ahead.

Turning and twisting more now they discover that the blackmail didn't work out as intended.

They played with fire so let them sit on the blisters. Goodbye Greece, try your game now with the Chinese or Russians, but I'm afraid that will have harsher consequences, than the freeloading game you played with the EU,in the long term

[worgeordie]

As the iconic Geordie comedian ,little Bobby Thompson, said

"Let them worry,thats owed"

So Greece, just keep the door shut when the debt collector

comes knocking..

regards Worgeordie

[Tatsujin]

So, does Greece get repossessed now it's defaulted on it's loans, like they do with car loans?

[teacherpaul]

But in a surprise move late Tuesday, Deputy Prime Minister Yannis Dragasakis hinted that the government might be open to calling off the popular vote, saying it was a political decision.

The government decided on the referendum, he said on state television, "and it can make a decision on something else." It was unclear, however, how that would be possible as Parliament has already voted for it to go ahead.

Turning and twisting more now they discover that the blackmail didn't work out as intended.

They played with fire so let them sit on the blisters. Goodbye Greece, try your game now with the Chinese or Russians, but I'm afraid that will have harsher consequences, than the freeloading game you played with the EU,in the long term

Let's hope Greece leave the EU soon. Hopefully other countries will follow. The EU has failed and has been dying for years.

[godden]

I'm hoping Greece is the first domino to fall in this corrupt regime.

[TallGuyJohninBKK]

National debit that's 180% of the country's gross domestic product???

How else is that kind of situation likely to end???

[BuaBS]

But in a surprise move late Tuesday,.....

Surprise to who ? Tsipras & Varoufakis must be the most bugged persons in europe.

The spy agencies probably know who of their wifes faked it last night.

The eurocriminals in Brussels take a hard line because they can hear the real Greek intentions live.

[micmichd]

Alexis Tsipras was too honest for these Eurogangsters.

[emilymat]

Maybe they are better going back to a devalued drachma. I've tried to keep abreast of this saga but it gets mind boggling. I saw a documentary about a year ago on BBC which went into the 'real' Greece. People were able to retire on full pensions at ridiculous ages such as 45 and pensions were being paid out willy nilly to people who had been dead for years.

I suppose the chickens are simply coming out to roost.

What I find strange is that countries could pay out 50 billion or so to rescue banks some years ago and yet Greece has defaulted on just over 1 billion. It almost seems like small change!

Of course, they can leave the Euro but stay in the EC (like us in the UK).

It's bizarre that the politicians in Greece will not wear a tie until the matter is resolved. Anyone noticed that. It's almost childish.

[jaywalker]

Gorgeous women there.

They should go back to the drachma and open girly bars by the gazillion.

They've got the beaches.

They've got the hot women....

Just sayin'... It works for Pattaya.

[winstonc]

dont give into these eu scum greece hope the uk is next to go

[mania]

So, does Greece get repossessed now it's defaulted on it's loans

That only happens when you don't pay your exorcist

[TheAppletons]

[BuaBS]

Gorgeous women there.

They should go back to the drachma and open girly bars by the gazillion.

They've got the beaches.

They've got the hot women....

Just sayin'... It works for Pattaya.

You'd think the internet would be overflowing with those hairy greek desperate women , but no , just the usual Czech hotties.

[Anthony5]

Here we go again.

http://www.marketwatch.com/story/greek-pm-tsipras-ready-to-accept-bailout-terms-ft-2015-07-01?siteid=yhoof2

Markets rally on report Greece is ready to accept bailout terms

According to a letter from Tsipras to the heads of the European Commission, International Monetary Fund and European Central Bank, obtained by the Financial Times, the Greek premier will accept all the bailout conditions on the table last weekend, with only minor changes.

Edited July 1, 2015 by Anthony5

[Basil B]

Dead Duck Paddling...

[ozyjon]

GREECE HAS NOT DEFAULTED yet

get it right

IT IS IN ARREARS

until a notice of default is officially sent to them

(so hurry up and do it)

[Publicus]

This is a rolling chaos, but 5 hours ago several news agencies said there is no new agreement,

Nor is there any agreement by the EU or other Greece creditors to talk about an agreement. Not until after the referendum on Sunday, or not before the vote is cancelled.

Tsipras now says the vote Sunday will be non-binding but that he wants a 'no' vote anyway.

Here 5 hours ago from 24NewsTV, quoting German Finance Minister Wolfgang Schaeuble who wants the referendum called off...

"First of all Greece must clarify its position on what it wants, and then we will have to talk about it, under conditions that are now far more difficult," Schaeuble told a Berlin press conference.

http://www.i24news.tv/en/news/international/europe/76647-150630-eu-leaders-urge-greeks-to-vote-yes-to-stay-in-euro-as-default-nears

[F430murci]

Gorgeous women there.

They should go back to the drachma and open girly bars by the gazillion.

They've got the beaches.

They've got the hot women....

Just sayin'... It works for Pattaya.

You'd think the internet would be overflowing with those hairy greek desperate women , but no , just the usual Czech hotties.

Oh yeah, Eastern European women and are hot, not so much in Greece and lol at the guys trying to turn them into hookers above. That would hardly do wonders to save their dumb butts from their current problems.

[F430murci]

I dunno, but China's stock is taking a beating since mid June related to this. Gotta love the government telling people to invest and people borrowing to invest. Margin calls, wealth being wiped away and now people cannot even repay the loans back for the money they borrowed to invest. Wow, just wow. US stocks bouncing back now that everyone is realizing most funds are hedged or not impacted by Greece's troubles. Bad situation.

Edited July 1, 2015 by F430murci

[mercman24]

the alarm bells were ringing years ago and nothing was done by Greece to rectify the matter, head buried in the sand attitude, and now it has finally hit the buffers. and the clown posting "i hope the U.K is next" wat you on Yabba ??

[micmichd]

EU was a misconstruction right from the beginning (EEC 1957)

Edited July 3, 2015 by micmichd

[Lissos]

Gorgeous women there.

They should go back to the drachma and open girly bars by the gazillion.

Stunning Women, for sure. However, Greek Women in Prostitution is very very rare, unless over the hill. The bulk of their 'ladies of tge night' workforce are Romanian, Ukranian, Moldovan etc.

[mercman24]

spoken like a true expert (joking ok )

[Prbkk]

So, does Greece get repossessed now it's defaulted on it's loans, like they do with car loans?

Send in the collectors to take the Parthenon Marbles

[F430murci]

China down 30 percent now since June. Holy cow! Who got screwed there and the how the heck is that not a topic on here. One of the biggest issues in the world but it does not have an anti US bias slant. The Greece issues are killing the Chinese stock market because their dumb butts were heavy in emerging markets. Hello.

I mean, holy cow. How is losing 30% of your entire stock market value in less than 30 days not news. Apparently, its not news here, Lol, that is more than Spain's entire market net worth, but not news here.

Edited July 3, 2015 by F430murci

[Jay Sata]

Socialism is all about spending other peoples money until it runs out.

The Greeks have had an easy time relaxing in the warm climate,enjoying a lifestyle they dont work hard for and retiring early while expecting industrious northern Europe to bale them out.

Well now it is payback time and if they think they have had austerity in the past the future holds some nasty surprises

[micmichd]

Do you really believe that only socialists spend other people's money?

If you think so, then banks (or all of EU) would be socialistic institutions. All people that live on taxes would be socialists, including those that use the NHS. Ie the vast majority of Europe.