Sunday, July 12, 2015

Greece Update: No Deal ... Yet

by Bill McBride on 7/12/2015 11:43:00 AM

From the Financial Times: France and Germany split over bid to break Greece deadlock

While Paris is backing Greek plans for a deal, Berlin is leading a group of sceptical countries that insist that Athens first passes significant reform laws in the next few days before negotiations can begin on a new rescue programme.
excerpt with permission
From the WSJ: Greek Deal Prospects Slim as Eurozone Leaders Convene
Finance ministers from the currency area convened earlier in the day, and discussed a draft statement that contains a “timeout” for Greece from the eurozone as a potential option, two European officials said Sunday. The statement, which may still change, will form the basis for crisis talks of eurozone leaders later Sunday, these officials said.

The statement says that “in case no agreement [on a new bailout program] could be reached, Greece should be offered swift negotiations on a timeout from the euro area, with possible debt restructuring,” one official said. The sentence is still in brackets, indicating that it doesn’t have the backing of all 19 eurozone countries.

However, French President Fran├žois Hollande later said, “There is no temporary Grexit. There is only Grexit or not Grexit.”
Too funny. Offered "debt resturcturing" if Grexit? It is called bankruptcy.

From Bloomberg: Tsipras Calls for Honest Compromise With EU Struggling to Trust
“The situation is extremely difficult if you consider the economic situation in Greece and the worsening in the last few months, but what has been lost also in terms of trust and reliability,” German Chancellor Angela Merkel told reporters as she arrived.