Greece Referendum

[Kilkis]

Samaras has resigned. He served in every ND government that contributed to Greece's bankruptcy and then had the nerve to be the lead in attempts to "rescue" it. He totally failed to implement any structural reforms and agreed to devastating wage/pension cuts and tax increases rather than tackle the real problems with the Greek economy. I hope he and Venizelos are investigated for corruption, tried, convicted and spend the rest of their lives in prison. Better still try them for treason, considering what they have done to the Greek people.

Now the bad news. What's the betting that he is replaced by Dora bringing back one of the corrupt dynasties that caused all the problems.

Warwick

[Clio]

I don't think the creditors are interested in what the Greek people think

They had jolly well better be, as Topdriller said.

Having watched the results come in, in the company of the kind of educated, modern-minded young Greeks who will help to transform this country given half a chance, having been much affected by their reaction of relief and delight, I'm celebrating a wonderful victory for people power and potentially the start of a new European order. Don't you think they knew the scary path they were voting for? Don't you want to wish them well for the courage of their choice? Do you only have negative things to say about tonight's events, Guy and anyone else? Tomorrow the real fight begins and yes, of course it is David v Goliath, and at the moment it does feel like taking on a powerful giant. But we've slung the first stone and boy, are they rattled. So If nobody else wants to cheer the Greeks - and most of all the Cretans - for standing up for democracy, then I'm happy to do it alone.

[Clio]

What's the betting that he is replaced by Dora bringing back one of the corrupt dynasties that caused all the problems

I don't think so. Tsipras and Syriza have won because they represent a new kind of politics and anyone wanting to rival them politically is going to have to understand that, now or in the near future, and field a fresh team too.

The people have voted (twice now) to reject the old guard and all it stood for. The Doras are a vanishing breed – dodos in fact

[Topdriller]

I agree with Clio, this is a milestone and something to be celebrated. The Greeks maybe had nothing to lose ie damned if they do, damned if they don't but they took the brave and courageous decision today. What's more it's a wake up call to the EU bully boys in Brussels that democracy still has an important place in Europe. Merkel et al wanted regime change through the back door - for a second time - but this time the Greeks said OXI for all of us...

Jon

[Carolina]

What's the betting that he is replaced by Dora bringing back one of the corrupt dynasties that caused all the problems

The people have voted (twice now) to reject the old guard and all it stood for. The Doras are a vanishing breed – dodos in fact

Don't count on it Clio. Rumour on the street tonight is that Dora said if he stepped down now she wouldn't humiliate him by stepping straight in to his shoes but she is there waiting in the wings for anytime soon.

[Carolina]

Oxi Oxi Oxi! Crete has the highest NO votes across the country, with the municipality of Chania leading the whole country with 73.6% NO votes.

[mhi]

I agree with Clio, this is a milestone and something to be celebrated. The Greeks maybe had nothing to lose ie damned if they do, damned if they don't but they took the brave and courageous decision today. What's more it's a wake up call to the EU bully boys in Brussels that democracy still has an important place in Europe.

I do not live on Crete, but I am regular watcher of this forum. I understand feelings of many Greeks, but if ECB does not increase ELA then Greeks lose a lot (not maybe, for sure). How will Tsipras open banks in such case? It's not about feelings, democracy, about bully boys in Brussels, it's about practical life. I think this will be disaster for Greeks, mainly after what Varoufakis and Tsipras are showing.

I would understand OXI only if there is a plan B for banks, like Neodrachma on Monday and new life with primary surplus, no external financing, ... and greedy creditors goodbye! But something tells me there is no such plan.

Would somebody explain to me what are real economical benefits of OXI vote?

Martin

[Loretta9]

mhi > "Economically" ?? I cant think of anything positive from 2008. But then Greece was not an issue until Lehman's went under and the criminals felt the consequences of their crimes. I put sovereignty over casino bully's any day of the week and have argued same on this very site since 2009 (Finglas style). Its a bit like having a football team full of George Best capability with Sep Blatta telling them how to play, limiting their natural skill and ability to win games. Once you set them free from distant control by people who do not themselves lose out no matter what happens, you then start to grow.
It will be very tough no doubt about that but if anyone reading this can tell me of any good times over the past 7 years I will be amazed.
Sovereignty should never be for sale, in my view.

[filippos]

I see that Varoufakis has resigned.
"Soon after the announcement of the referendum results, I was made aware of a certain preference by some Eurogroup participants, and assorted 'partners', for my... 'absence' from its meetings," Varoufakis, who had often clashed with creditors in negotiations over the past months, said on his blog after announcing the news on Twitter."

Report here

[Kilkis]

Obviously the people who voted NO and anyone who supported that position would celebrate last night. I'm sure they were very happy. You wouldn't expect the people who voted YES to be celebrating would you? As someone who is sat exactly in the middle I'm afraid I don't have any reason to celebrate either. I wouldn't be celebrating a YES vote either. The outcome is the outcome. I am more concerned with what happens next.

While I fully understand that whichever side won the vote they would celebrate, I would say that the celebrations are somewhat premature. It's a bit like opening the champagne at half time because your team is 3-0 up in a Champions League final. As Scooby can testify, it is not always a wise thing to do. It ain't over until the fat lady sings.

Whether it is a "wonderful victory" depends on what happens next. I sincerely hope that Tsipras is correct, that the NO vote strengthens his negotiating position and that he is able to negotiate a better deal that will help the Greek economy, instead of crushing it, and create jobs, especially for the young. If that happens I will gladly foot the bill for a celebration party, Clio.

If you have a strong position then anything that goes against that position is viewed as negative and anything that supports it is seen as positive. Whether it is positive or negative depends entirely on your position. Again, as someone sat exactly in the middle my comments are intended as neither negative nor positive. They are simply my opinions, which I try to keep as factual as possible or at worst based on facts.

Until the last couple of days, through 5 years of implementing the Troika programme and over 5 months of trying to negotiate a better deal I cannot find one single piece of evidence that the creditors gives a toss about the Greek people. The leaders and the Eurogroup care what their own voters think. They and the EU institutions care about the European project. In the last couple of days, when they began to realise that a NO vote was possible, some suddenly started making comments about supporting the Greek people. I believe that was simply another political ploy to try to persuade people to vote YES because "we are on your side".

The creditors are in exactly the same position after the vote as they were before it. To save the European project they know that they need to take a different approach to Greece and the other southern states. There has to be a mechanism of recycling money within the Eurozone from the strong states that are operating a trade surplus to the weaker states that are operating a trade deficit. Without it the Euro cannot succeed. They cannot sell that idea to their own voters. Any new deal for Greece will not be based on support for the Greek people or giving in to the popular opinion. It will be simply a matter of sliding the compromise a little towards the "recycling end" without getting too far from the "satisfying domestic voters end". Exactly what form it will take I don't know. One possibility is to give debt relief but at the same time employ a Greek bank bail in, along the lines that happened in Cyprus. That allows them to tell their voters that yes they are letting Greece off some of its debt but the Greek people are also paying the price. I'm not saying it will happen but I am willing to bet that it is discussed behind closed doors.

Varoufakis departing is part of the face saving dance that inevitably occurs in these circumstances. Tsipras can say that Varoufakis was responsible for holding the creditors to account and has done a great service to the Greek people but now considers he has done his job and has decided to step aside in the interests of unity. The creditors can say that they always wanted to reach a compromise with Greece but were faced with an argumentative, hectoring finance minister that they simply couldn't negotiate with. Politics goes on.

Warwick

[bobscott]

A very well-reasoned analysis Warwick. Nothing we can do except sit and wait. And pray, if you are that way inclined. Bob.

[Kilkis]

The international market's reaction to the NO vote has been pretty sanguine. While there were some initial blips most indices have started to recover. Stocks are down a little across the board but nothing exceptional. The Euro is down very slightly against Sterling and virtually flat against the US Dollar. There has been no big rush to safe havens. Gold is only slightly above Friday's close. German bond yields are down a little and those of the southern European states are up a little but nothing drastic. All within normal movement ranges. Obviously Greek bond yields have climbed markedly.

A much more volatile response would have been helpful to Tsipras. The creditors will look at the way the markets have reacted and feel they have no real market imperative to shift their position. If the Euro and stocks across European exchanges had bombed and Spanish, Portuguese and Italian bond yields had risen markedly they would be under much bigger pressure to find a solution.

Warwick

PS Asian stocks are down significantly but that may well be a response to what is happening in China rather then to the Greek vote.

[scooby]

I can't help but think that Tsipras and the EU leaders know more than they are letting on hence the confidence of Syriza. Shame Varoufakis resigned but he was never a politician and never wanted to be one as he doesn't speak with fork tongue.

[Kilkis]

Another thought on Varoufakis' resignation. I suppose you could regard it as the creditors at least partially getting the regime change they wanted?

Warwick

[Kilkis]

The Daily Reckoning characterises the ECB decision today on ELA a "Damned if they do, damned if they don't" one. The ECB is supposed to be independent, outside politics and not to make political decisions.

If they extend ELA to prevent a Greek bank collapse they are going against their own rules. Greece is insolvent, not in a bailout programme, declared in arrears by the IMF and in default by the EFSF so they shouldn't be lent money. Extending further credit can only be viewed as a political decision.

Equally if they don't extend credit then the Greek banking system is likely to collapse within days and that could accelerate an exit from the Euro. The ECB would be viewed as causing Greece to exit which is obviously another political decision.

Remembering that it is a committee that decides, made up of representatives of member states, the decision will give some clues as to how the Eurogroup is likely to behave in future negotiations.

Warwick