Greece's FM resigns as Athens scrambles to avert economic collapse

[Surya Gayatri]

Last edited Mon Jul 6, 2015, 05:49 AM - Edit history (1)

Source: USA Today

Greece's Finance Minister Yanis Varoufakis said Monday he is stepping down after his country rejected the bailout terms demanded by Athens' creditors in a referendum.

Varoufakis said he was resigning because he was "made aware of a certain preference by some Eurogroup participants, and assorted 'partners,' for (his) 'absence.' "

He announced his resignation in a blog post on Monday.

The rejection of Sunday's vote increases the likelihood that debt-wracked Greece will exit the eurozone.

ETA: USA Today changed headline.

Read more: http://www.usatoday.com/story/money/business/2015/07/06/varoufakis-resignation-greece/29755833/

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Rat abandons sinking ship that he helped run onto the shoals.

I thought the 'NO' vote was supposed to reset the clock at zero. A whole new ballgame - a newly level playing field - Greece would immediately reopen 'fairer' negotiations with her creditors, ETC. ETC. ETC.

So, now he calls it quits.

[CincyDem]

1. Welcome to the kabuki that is global finance

I suspect, and we will likely never know, is that his departure is part of a global script agreed to well before the referendum.

IMF and the Euro Central Bank will ultimately reopen negotiations and develop a "fairer" debt structure going forward. BUT - the individuals involved (Lagrande, Dhragi, etc) can not be seen to be giving in to Yanis. They won't have to face their conquerer at the negotiating table.

Additionally, it will give the finance ministers of Spain, Italy, Portugal a reason for pause should they think the Greek strategy will work for them. IMF/ECB can't be seen as opening the door for those countries to easily travel the same path as Greece. With Yannis' resignation, the script is set - take this path and you may get better terms (if, by some chance, your population is as united as Greece) but you Mr Finance Minister will watch the solution from the sidelines.

As we enter the final act of the play, Yannis has to go. He can't be the hero at the end of the show.

[Surya Gayatri]

7. "He can't be the hero at the end of the show..."

NO danger of that...

"Additionally, it will give the finance ministers of Spain, Italy, Portugal a reason for pause should they think the Greek strategy will work for them."

Let's hope to hell you're right. The euro and its member countries are teetering on the brink of the abyss.

[cloudythescribbler]

2. The idea is to negotiate a better deal, and those w/ whom they are negotiating don't want him

I think that his decision is a "team" decision of the Syriza leadership. Rather than just sniping at him, or portrraying the "no" vote as duping the Greek voters, progressives around the world should LOUDLY unite and INSIST that the creditors do the ONLY intelligent thing, which is to loosen the noose around Greece's neck.

An interesting recent column in the NY Times suggested that the EU hardliners want TO force Greece out of the Eurozone pour encourager les autres -- to stop the other countries suffering under completely horrible and counterproductive austerity programs from seeking relief

It is morally perverse to blame Syriza for Greece's crisis, which was MANY years in the making, and has been going on for five long years. They are rightly insisting on an end to destructive austerity, which approach requires the other side in the EU to show flexibility that they so far have not

[Surya Gayatri]

3. "MANY years in the making," including during the time they were

fraudulently applying for accession to euro-zone membership.

[freshwest]

6. Thread citing Picketty says a European confernence on all Euro debt is needed as was done post-WW2.

Another thread says that the voters actually voted for the deal offered by the Troika. And that it was actually a Yes vote and not a No vote. Yanis said he would resign if it was - I forget. I've posted to you on one of your threads and 2 other threads. Picketty seems to have the real nature of the problem in mind, a transnational one instead of one state at a time. Comment?

[Surya Gayatri]

9. "European conference on all Euro debt is needed as was done post-WW2..."

This may be the only way out, plus a revised euro-zone treaty requiring closer political integration.

And, yes, he pledged to resign if the "YES" camp carried the day.

Now, he resigns and leaves others to pick through the wreckage and try to salvage something of the original euro-zone treaty.

If I was a Greek, having voted 'NO' yesterday, I think my reaction would be a giant:

[Spitfire of ATJ]

4. Watch the name Yanis Varoufakis turn up on the board of Goldman Sachs.

[Surya Gayatri]

5. ^^^This!^^^

[TexasTowelie]

8. I wonder if they still held his professorship open

at the University of Texas?

[Surya Gayatri]

10. If he's no better a professor than a finance minister, I doubt it.

[azmom]

28. LOL. Have you read any of his books?

[Spitfire of ATJ]

40. No, but now reading about him makes me wonder why he quit.

[azmom]

41. He isn't going to Goldmans Sachs, that's for sure.

[Spitfire of ATJ]

42. Maybe his leaving was part of a deal.

[MrMickeysMom]

63. You have got to be kidding...

To do what? Dismantle it?

Come now… you can think further than that move...

[Spitfire of ATJ]

65. I was following the American model.

[MrMickeysMom]

66. Yep… That sure seems to be our model...

… but, I have a different feeling about him. Greece is our point of light to follow (as opposed to a thousand points of light, like pappy Bush loved to say)

I'm very curious meanwhile.

[jtuck004]

11. He actually sounds like the one who is on the people's side here The bank$ters and rentiers seem

to hate him - and are having a tantrum unless he quits. So he did, because the country needed it.

I'd stand with him.

http://www.democraticunderground.com/1017246559

[Surya Gayatri]

12. See this thread and the discussion about his "negotiating" tactics...

http://www.democraticunderground.com/10026943620#post3

http://www.democraticunderground.com/10026943620#post6

http://www.democraticunderground.com/10026943620#post13

http://www.democraticunderground.com/10026943620#post14

[Surya Gayatri]

13. Well, if he's SO much on the people's side, such an advocate for the downtrodden,

why isn't he standing his ground and staying with the job? Finishing what he started.

He pledged to resign ONLY if the YES vote carried the day...RIIIIGHT!

[magical thyme]

32. so he out-negotiated the Troika's pirahnas. Good on him.

Germany has been refusing to pay war reparations since 1946, and has benefited at Greece's expense for all those decades. Time for them to pay the piper.

[Surya Gayatri]

33. As Greece sinks further into the miasma, yeah, good on him.

[magical thyme]

46. a lot of people believed Iceland would go down if they didn't bail out the banksters too.

They led the way through the bankster mess. Now maybe Greece can lead the way to the return of democracy.

[Surya Gayatri]

52. Their respective economic situations are disssimilar.

[magical thyme]

56. so? does that mean they recover via dictatorship? I'm sure if the US has anything to say about it,

it does.

Time will tell.

[Surya Gayatri]

57. Sadly, the Greeks have a long and shameful history of

overthrow by military junta. If Greek society really begins to fall apart, look for the colonels to elbow in.

[magical thyme]

59. whereas the Germans have a long and shameful history of torture, mass murder

attacking and stealing from neighbors, and more.

The Greeks shameful history of military junta was ushered in with a little help from the US, you know. And Nuland was visiting just a few weeks ago. Here we fucking go again.

[Surya Gayatri]

61. I'd be the first to agree that Germany has much to answer and atone for, not to mention

that they piss me off royally with their often smug and self-righteous chiding of their European partners for budgetary "lapses".

[MrMickeysMom]

64. No, ^^^THAT^^^^

[Darb]

14. From what I have seen, you got him wrong.

Yanis is one of the good guys. He was not part of the problem. I think rather the big finance guys don't like him and will probably fuck the greeks for spite, so he is getting out of the way not to give them any excuses?

I like Yanis.

[magical thyme]

15. this, exactly. He brought the Greeks to the point where the government now has political capital

he is backing out of negotiations because the Troika hates him. He took their heat in order to buy negotiating room for the Greeks.

He will no longer be the frontman, that doesn't automatically mean he can't be advising his replacement from behind the scenes.

[Surya Gayatri]

18. See this thread for a discussion of the "admirable" Mr. Varoufakis and his negotiating tactics...

http://www.democraticunderground.com/10026943620#post6

http://www.democraticunderground.com/10026943620#post13

[Darb]

22. I don't give a shit about his negotiating tactics.

The Bond Trader Pirates are extremely polite and look very sharp in the $5,000 Italian suits. But they are still psychopaths.

Like I said, he now obviously thinks the crybaby pirates would be more likely to make a deal if he wasn't there kicking them in their psychopathic, Ken doll, crotches.

[azmom]

29. The Greeks stood by Yanis and their prime minister. Respect

Democracy. The people voted Yanis won.

[brentspeak]

30. You don't understand something about the OP

The OP is sympathetic to the big finance guys.

[brooklynite]

16. My wife (an international tax lawyer) says he was a blowhard..:

...and nobody wanted to work with him.

[Surya Gayatri]

19. Give your wife a handshake from me...! She called it in one.

[Darb]

23. I am sure they were crying like two-year olds that he wouldn't cave to their extortion.

Bunch a goddamn babies.

[brooklynite]

25. Why would they cry?

All they have to do is cut off the spigot of continuing loans; without an agreement, the Greek banks will be dry by the end of the week.

[Darb]

39. If there were no consequence to doing that, then why haven't they done it?

Perhaps they just want all the little guys throughout the world to think they have no choice but to fall to their knees and provide fellatio to the gods of finance that created a labyrinth of deceit and fraud so complex that only they can understand it and only they can decide the path forward.

Cut them off and see what happens.

[magical thyme]

17. rat? no. Now the Troika can "save face" by putting all blame on him

they can blame failed prior negotiations on "bad boy" Varifoukas, and start offering *real* solutions to the crisis.

The release of the 5 year old IMF report that stated that bailouts would not succeed without debt restructuring wasn't leaked by chance last week.

Now that the Troika's lies by omission have been revealed, they can be forced to include debt restructuring. Greece's debts would *never* have become so onerous if the 2010 aide had been properly administered instead of loading the people up with unpayable debt and crushing the Greek economy in order to prop up Germany's banks.

[Surya Gayatri]

20. Greece will soon be a former member of the Euro-zone...and good riddance.

Greece's structural problems date from far before 2010 and long before they fraudulently applied for accession to euro-zone membership.

[brooklynite]

24. MY wife notes that Ireland and Iceland had bad banks but good economies...Greece has neither

[Surya Gayatri]

26. Short and sweet...that about covers it.

[magical thyme]

31. I'd like to see them leave too, for their own salvation

But for that to happen, they will have to turn to Russia and China. And the US absolutely does NOT want to see that happen.

The US likely is behind the IMF report leak. Nuland was in Athen just a couple weeks ago, so we're definitely meddling around to see the chances for a color revolution to overthrow Syriza and put our own dictatorship back in like we did post WWII the last time Greece elected a leftist government.

Plus, like it or not, the Euro-zone can't afford to have the first domino fall. If Greece goes, Portugal, Italy, Spain and even France will be next.

France is already on record yesterday as stating they will do whatever it takes to keep Greece in, and have an emergency meeting with Merkel today to discuss how.

[Surya Gayatri]

34. Well, you're in the minority then, 'cause there's this...

Poll: 66.5% of Greeks Prefer the Euro Over Drachma

http://greece.greekreporter.com/2015/05/05/poll-66-5-of-greeks-prefer-the-euro-over-drachma/

[magical thyme]

48. I'd be in the minority if I was a Greek citizen. I'm not, so my opinion is irrelevent.

and the reality is that they are unlikely to be able to get out of the euro any time soon, due to the logistics. But California and Canada both led the way in running "iou" or parallel currencies during crises.

Valoukaris, Tsipras and company were hard at work yesterday on finalizing plans for the immediate crisis. I have no doubt that Valoukaris resigning was part of that plan, to enable negotiations to go forward with a clean slate.

He played bad cop to Tsipras' good cop to get the Troika to the bargaining table in good faith instead of the shit they've been playing all along. It's all part of the negotiating game.

[Surya Gayatri]

50. That seems to be working well...

"...I have no doubt that Valoukaris resigning was part of that plan, to enable negotiations to go forward with a clean slate."

http://www.democraticunderground.com/10141137591

No basis now for new debt talks with Greece: Germany

[magical thyme]

55. Well it's not 100% up to Germany. France made it clear they want them in. But it looks like the ECB

(and Goldman) want them out.

It Begins: ECB Hikes Greek ELA Haircuts; Full "Depositor Bail-In" Sensitivity Analysis

Further confirmation that this was a haircut increase comes from Reuters reporting that the ECB will hike the haircut just enough to reduce the collateral on Greek banks to slighly above the current level of use which is about €90 billion. In other words, the ECB increased its haircut from roughly 50% to just about 60% above which level depositor bail ins begin.

Needless to say, this decision makes it quite clear that it was not Greece, but the ECB pushing all along for "burning the Greek bridges" - just as we warned in "Goldman's "Conspiracy Theory" Stunner: A Greek Default Is Precisely What The ECB Wants" - and as a result any chance of a compromise resolution with Greece may have just been, well, burned
http://www.zerohedge.com/news/2015-07-06/it-begins-ecb-adjusts-greek-ela-haircuts-full-depositor-bail-sensitivity-analysis

One interesting point I read some weeks ago that Varoufakis wanted Greece to stay in; Tsipras wanted them out.

I'm wondering what the US ultimately will do. Nuland was there just a couple weeks ago; fomenting a color revolution perhaps? We have a track record of orchestrating coups and dictatorships when Greece elects a leftist government. Presumably we very much don't want them to turn to Russia and China.

[Surya Gayatri]

58. Their strategic geographic location, especially as the Middle East blows up just next door,

means that any overtures to or from Russia or China would be firmly rebuffed, and by the EU first of all.

[magical thyme]

60. if the EU throws them out then the EU doesn't get a choice

which is why I don't believe they will throw them out.

That was my basic point to begin with -- the US definitely doesn't want to lose them to Russia or China.

[Surya Gayatri]

62. Oh, not to worry, they'll never be thrown out of the EU...unthinkable.

They ARE the birthplace of democracy, after all.

Out of the euro-zone? Not such a long shot.

[DCBob]

21. I suspect Varoufakis knows how ugly it is going to get..

and also its going to become clear what he told the people was a big fat lie... so better to bail out now before the pitchforks come out.

[Surya Gayatri]

27. Think ya got something there, Bob. A rat, a chicken and a liar..

[Comrade Grumpy]

36. You are getting unhinged now. Just blathering insults.

[Surya Gayatri]

37. Mirror, mirror, on the wall...

[Comrade Grumpy]

35. Your OP is tendentious. He was forced out by the troika.

When did you become the spokesperson for the troika?

[Surya Gayatri]

38. That's his exit excuse and cover story...as for the piece itself, you'll have to contact USA Today.

[azmom]

43. LOL You are too funny Comrade!

[Adrahil]

45. Wait, how could they force him out?

I thought the Greeks were telling the Troika to piss off.

Or maybe it was just political theater?

Yanis knows exactly how ugly things will get. His resignation is an attempt, I think to attract the Troika back to the table.

[blackspade]

44. What make him a rat specifically?

The fact that he resisted the troika's racketeering?
Or that he is a part of a left wing government?

[Surya Gayatri]

51. That he lied to his Greek constituents? That he played the

grandstander and blowhard, using incendiary rhetoric, calling his negotiatoing partners "terrorists"?

[blackspade]

53. He lied in what way?

He played the grandstander and blowhard in negotiations because that is what he was hired to do, go to bat for the Greeks.
And the Trioka are economic terrorists. Austerity is a form of economic warfare by banksters on the 99%.

So what now? more empty rhetoric?

[Surya Gayatri]

54. That he pledged to resign only if the YES camp carried the day?

Forked-tongued fulminator.

[MattSh]

47. You've got way too much time on your hands...

Or an agenda. One or the other.

First there's the OP, and 18 responses to other people.

And worse, you quote USA Today like it's some kind of authority on anything. And please don't respond with the NY Times. They're not a whole lot better.

[Surya Gayatri]

49. Retired, on a fixed-income pension, paid in and pegged to the euro.

I pay my rent and keep food in my fridge with euros.

You could say this is of premier importance to us working-class Europeans who are in the front lines, yeah. If that's an "agenda", so be it.

As for USA Today, you could take any other source. The headlines were all of a piece. Just happened to fall upon that one first.