At the end of October 2010, your author attended an event in Brussels held by the Lisbon Council. The star turn at the event was Commissioner Rehn.
During his presentation and Q&A, he did what he had to do. He told us all that Greece was fine, it was not about to go under and he rubbished reports in the FT (by Wolfgang Munchau) to the contrary. I’m not sure there were too many in the audience that fully believed him, but there we are. (I blogged about the event here.)
If you watch the video shot at the event (here) and fast forward through to about 2 mins 50 seconds, you will hear of the plans of the Commission. “The EU will end up with tough rules“.
Enough of the historical recap. What happened at the latest summit?
Have a read of the coverage here at Euractiv and you find yourself wondering what they must be thinking about…
“Barroso already announced earlier this week that he wanted to “front-load” structural funds set aside for Greek regional projects to help the country rebuild its public sector.”
“He pointed out that the EU budget provides over €20 billion for Greece for the period 2007-2013: only a quarter of this has been spent until now. He added that from €675 million structural funds allocated to Greece for technical assistance, €420 million was still unused.”
Unless I am mistaken, the new new plan seems to be to give Greece money set aside for other things so that it can repay it’s debts. Will it use that money to repay them? Or will that money go into the same black hole that all other money seems to flow into there?
What good will it do? When you take the rounding, it seems that there is plus or minus €250 million euros that can be used to help the Greek economy. However, depending upon where you read, the Greek economy will be either €26 or €28 billion short in a couple of months.
If the Greek economy can turn €250 million in €28 billion in three months, they will have the combined financial powers and prowess of every great trader, investor, entrepreneur and business titan to have ever walked the earth. In which case, they shouldn’t be in this mess.
Do the words “clutching” and “straws” seem appropriate?
It seems to me that unless the host kills the parasite, the parasite will kill it’s host. Them strong words, I know. But if EU leaders keep dithering like this, there is a very real chance that the entire euro currency could be pulled apart. That would be messy and horrific. Booting Greece out would be messy and horrific too, just much less so.financialguy