IMF stuns Europe with call for massive Greek debt relief

[PoliticAverse]

The International Monetary Fund has set off a political earthquake in Europe, warning that Greece may need a full moratorium on debt payments for 30 years and perhaps even long-term subsidies to claw its way out of depression.

"The dramatic deterioration in debt sustainability points to the need for debt relief on a scale that would need to go well beyond what has been under consideration to date,” said the IMF in a confidential report.

Greek public debt will spiral to 200pc of GDP over the next two years, compared to 177pc in an earlier report on debt sustainability issued just two weeks ago.

The findings are explosive. The document amounts to a warning that the IMF will not take part in any EMU-led rescue package for Greece unless Germany and the EMU creditor powers finally agree to sweeping debt relief.

Read the rest at: http://www.telegraph.co.uk/finance/economics/11739985/IMF-stuns-Europe-with-call-for-massive-Greek-debt-relief.html

[Fred Sanders]

1. NYT reports that Tspiras continues to have the overwhelming confidence of Parliament and the people.

http://www.nytimes.com/2015/07/15/world/europe/tsipras-is-seen-as-holding-greeks-approval-while-selling-tough-bailout-deal.html?hp&action=click&pgtype=Homepage&module=first-column-region®ion=top-news&WT.nav=top-news&_r=1

"Analysts said that the faction of Syriza that seemed in open revolt, the Left Platform, which has about 30 members who had signaled that they would vote no on the deal, also seemed to be softening its opposition.

Mr. Tsipras’s public popularity is unquestioned at the moment. Experts say that is partly because he has remained a likable figure through the negotiations and partly because the political alternatives at the moment are few.

Mr. Tsipras’s government is the fourth for Greece in the past five years, a pace of change that has chewed up a lot of leaders and greatly reduced the support for the country’s mainstream parties.

“His approval is unprecedented,” said Aristides Hatzis, an economics and law professor at the University of Athens, who frequently writes about the Greek crisis. “Why? For one thing, there is no opposition. No alternative. He has tremendous political capital. He will be able to pass everything with minimal losses.”

[Hydra]

2. *Checks to see if Hell froze over"

Will wonders never cease.

[bemildred]

3. EMU brutality in Greece has destroyed the trust of Europe's Left

The EU establishment henceforth faces what it has always feared: a political war on two fronts at once.

It is long been fighting an expanding coaltion of free marketeers, parliamentary "souverainistes", anti-immigrant populists on the Right.

Its has now lost its remaining emotional hold on the Left after the scorched-earth treatment of Greece over the past five months - culminating in the vindictive decision to impose yet harsher terms on this crushed nation just days after its cri de coeur in a landslide referendum.

This has been coming for a long time. We Conservatives have watched in disbelief as one Socialist party after another immolates itself on the altar of monetary union, defending a project that favours the elites - a "bankers' ramp", as the old Left used to call it.

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/11742624/EMU-brutality-in-Greece-has-destroyed-the-trust-of-Europes-Left.html