Greek "No" vote means ECB can no longer sit on fence 5 Jul 2015 A convincing anti-euro zone vote means the European Central Bank must decide whether to cut the Greek banks off from crisis loans, risking financial meltdown. In theory the ECB may be able to keep the sector going while the dust settles. But that may be politically impossible.
Hugo Dixon: Greece will struggle to stay in euro 5 Jul 2015 After the people gave an emphatic “No” to the creditors’ proposals, there are still several ways Athens could avoid the drachma. But none seems terribly likely. All routes will lead to further hardship.
Tsipras departure could unlock Greek debt relief 3 Jul 2015 European creditors are wary of writing off Athens’ debts because it could set a precedent. Yet if Prime Minister Alexis Tsipras resigns after the referendum, a deal should be doable. Few politicians would follow his path of capital controls, economic strife and career implosion.
Hugo Dixon: How to jump Greece’s next debt hurdle 3 Jul 2015 Even if the Greeks vote “Yes” in Sunday’s referendum, the country will struggle to pay a bond owned by the ECB on July 20. Failing to pay could trigger the bankruptcy of the country’s entire banking system. Financial engineering may provide a solution.
Life after default: Malaysia’s tips for Greece 3 Jul 2015 The Asian country shunned an IMF lifejacket in 1998. Greece could soon be in a similar boat. Breakingviews imagines former leader Mahathir Mohamad’s advice to Greek PM Alexis Tsipras: devalue, fix the banks, and boost spending – but don’t bother jailing your finance minister.
Hugo Dixon: Greeks choose between bad and terrible 2 Jul 2015 Voting “Yes” in Sunday’s referendum would mean Greece suffers at least two years of recession. Voting “No” would bring financial havoc in the short run followed by the return of the drachma, hyperinflation and deep-seated economic depression. The right answer is “Yes”.
Greece could use German-style last-ditch mediation 1 Jul 2015 A proven technique to resolve deadlocked wage disputes in Germany is worth a try in the Greek standoff. Both sides could name an impartial mediator who proposes a non-binding compromise. By bridging the lack of trust, a breakup prohibitively costly for everyone may be averted.
Hugo Dixon: Tsipras looks like he is crumbling 1 Jul 2015 With Athens defaulting to the IMF, public opinion moving against the Greek PM and the banks closed, Tsipras seems desperate for a deal with his creditors. But it is not clear they will cut him any slack. They may prefer to deal with his successor.
New Greek bailout bid mixes chutzpah with caution 30 Jun 2015 Athens wants a last-minute EU backstop loan to avoid a technical default if it doesn’t repay the IMF on Tuesday. Assuming the answer is no, it might convince Greeks to vote for euro exit. It could also serve as a signal to the ECB not to cut off emergency Greek bank loans.
Greece makes IMF stooge in game-theory drama 30 Jun 2015 Athens probably won’t pay the IMF debt due on June 30. It’s a tactic - the Greek government can and will honour the debt eventually. But non-payment puts pressure on the euro zone to sweeten its deal – or to collapse Greek banks and accelerate euro exit.
Capital controls hit Greek economy at worst time 29 Jun 2015 Closing the stricken state’s banks would be a disaster at any time of year. But Athens’ capital controls are kicking in just as one of Greece’s main drivers – tourism – hits peak season. Even if Greeks don’t leave the euro, 2015 will be a writeoff.
Muted markets validate EU hardball with Athens 29 Jun 2015 Next Sunday’s referendum could force Greece to leave the single currency. Yet bond markets are trading shy of full crisis levels. If things stay that way it eases the pressure on euro zone politicians to offer sweeter terms to the country’s leader, Alexis Tsipras.
Hugo Dixon: It’s still possible to stop Grexit 29 Jun 2015 Athens has declared a six-day bank holiday after talks with its creditors broke down. But there are several ways Greece can still avoid quitting the euro. The most obvious is to vote in the coming referendum for the terms offered by the euro zone and International Monetary Fund.
ECB should resist giving Tsipras more ammunition 28 Jun 2015 Greece will shutter banks and limit withdrawals after the ECB refused to increase funding. That could help leader Alexis Tsipras convince Greeks to back euro exit in a July 5 referendum. The ECB could counter by maintaining its loans even if Greece defaults on the IMF this week.
Hugo Dixon: Tsipras gambles Greece 27 Jun 2015 The Greek PM is offering the people a choice between bad and extremely bad. Capital controls are likely before a July 5 vote on the creditors’ terms. It’s not clear their offer will be on the table even if the people want it. If they don’t, the drachma and more misery lie ahead.
Guest view: What Argentina teaches about Greece 25 Jun 2015 The South American nation tried to live a currency lie in 2001. But even clever schemes could not stave off crisis. Fernando Fernandez of IE Business School argues that Greece is in a similar situation. Clever plans cannot save the country from an untrustworthy government.
Time for EU to end Greek debt relief omerta 25 Jun 2015 Euro leaders in Brussels are refusing to discuss an easing of Athens’ debt pile until Greece makes solid reform pledges. That may make sense politically. But debt relief is a necessity, rather than a nice-to-have. If it were offered now, Greeks might budge on structural reform.
Greece stumbles towards dissatisfying compromise 23 Jun 2015 Any deal would be good, but the agreement being cooked up by Greece and its creditors in the EU and IMF looks decidedly unappetising. Athens’ government may introduce growth-slowing tax rises. More substantial reforms remain far distant. The crisis is far from over.
Hugo Dixon: The big fat Greek blame game 22 Jun 2015 If Greece collapses, the biggest chunk of the blame will go to whoever behaves most unreasonably in the final stages of the current game of chicken. So both sides have an incentive to accommodate each other’s reasonable positions. Hopefully, they realise this.
Greek point of no return could come on July 20 19 Jun 2015 The slide into financial no man’s land begins whenever the ECB has no excuse for propping up Greek banks. The central bank can overlook a June 30 non-payment to the IMF, even if a deposit run leads to capital controls. But if Greece stiffs the ECB on July 20, it gets much harder.