The Greek Bailout Is A Fraud

Greece Bailout

Although this article was first published five and a half years ago, it is just as relevant today, indeed more so, because after initially talking tough, the men currently running Greece have sold their people down the river. There is still talk about their capitulation leading to Greece being bailed out, but higher taxes, reduced pensions and more austerity is a bailout in what sense?

The reality is that the bailout is indeed a bailout, not for the Greeks, but for the banks. American Libertarian Peter Schiff warned against this five years ago, as doubtless did many others. We have seen this sort of thing before and on an even larger scale with the so-called credit crunch. The banks and so-called professional fund managers screwed up, and looked to the politicians to bail them out. And bail them out they did. Heck. we’re still paying for this now! And the people of Greece will still be paying for the current bailout ten, twenty, fifty years from now. Wouldn’t want to put a few banks out of business, would we?

So why has the Greek leadership capitulated? It could be because they’ve been got at, but it is more likely they’ve been duped into believing the alternative is far worse: mass unemployment, the rest of the world abandoning Greece, and so on. The alternative was of course for Greece to declare bankruptcy, to renege on its debts. Would this really have been such a disaster? England was technically bankrupt at the start of the First World War, yet not only fought but won it. Is Greece in worse shape than England 101 years ago?

So where to now? One solution has been mooted by the American anti-usury activist Ellen Brown, a solution she says could be implemented without hurting genuine investors. Take a gander at it. There is of course another solution. What a pity Dylann Roof went to a church instead of a bank.


About the author

Alexander Baron

  • PeterA

    It’s a story well circulated in Left circles (capitalism and banks are evil etc). It’s also a favourite of Conspiracy theorists.

    The ‘fraud’ transactions involved Greece owing money to French and German banks.
    Greece was unable to repay on the due date.
    Options: defer repayment or bankruptcy/exit the Euro or borrow another loan to repay the banks
    If Greece wanted to remain in the Euro then the only option on offer was from the EU/EZ on condition any new loan was used to repay the banks.

    Greece borrowed the money in the first place
    When they couldn’t repay on time they asked for another loan to repay the first one.
    Nobody forced them, because they wanted to remain in the EZ.
    Their govt and parliament accepted the terms, just as they are about to do with the current repeat transaction!

    Fact is that we are today exactly, exactly where Greece and the banks were at the time of the ‘fraud’: Greece right now August 2015 needs $x to repay on 15th August a bank loan to the ECBank.

    The circumstances are the same in the current transaction as with the ‘fraud’ loan, and the ‘fraud’ is about to be repeated with the current bail out: Greece is about to sign-up to a new loan which will go straight to the ECBank to pay-off a previous loan!

    The EZ countries, particularly Germany (their taxpayers), are the funders of the ECB and want conditions on their new loan, including that it is used to repay the ECB and not distributed to favoured projects in Greece.

    May seem obvious but Greece wants to appear virtuous by being kicked out.

    Each side is waiting for the other.

    The answer is for Greece to get out of the EZ and start using the Drachma.
    Bankruptcy yes devaluation yes but there’s clearly strong resistance from other taxpayers in funding incompetence inefficiency and corruption in Greece, whatever the merits of Greek needs may be. Greece had its chance with massive bailouts and blew it.