Greek bonds

yoganmahew · November 17, 2009, 6:43pm

ftalphaville.ft.com/blog/2009/11 … nd-market/

It’s all Greek to the European bond market
Posted by Izabella Kaminska on Nov 17 14:17.

The spread between Greek bonds and German bunds widened to 153 basis points on Monday, the widest since July 17. And while analysts connected this to the deteriorating state of the nation’s finances, what struck us as interesting was the following statement from the Greek central bank (via Euro2day).

As Bloomberg reported:

Greece’s central bank asked domestic lenders to outline potential funding sources in coming months as the European Central Bank begins to tighten the liquidity it provides to Europe’s banking system, Euro2day reported.

In a letter to the institutions, the Athens-based central bank said Greek lenders as a whole had borrowed amounts that were proportionally greater than other countries in the 16- nation euro area, the Web site said, without saying where it got the information. Greek banks have borrowed a total of 42 billion euros ($63 billion) of the 570 billion euros the ECB has pumped into the system, according to Euro2day.

Hey, I thought we had the bigger proportional amount of bonds?

PROFESSORI · November 17, 2009, 7:50pm

Sure it’s only Greece,its not like there has been a mad broad based government and personal debt bubble fuelled by ludicrously low ECB interest rates across the whole of Europe now is there?

PROFESSORI · November 18, 2009, 12:12pm

Greek banks fall on ECB loan fears

By Courtney Weaver

Published: November 16 2009 12:09 | Last updated: November 16 2009 18:55

Greek bank shares fell sharply on Monday on concerns about the impact of an eventual withdrawal of cheap financing from the European Central Bank.

Greek banks have borrowed €42bn, or 7 per cent, of the total €570bn extended by the ECB.
EDITOR’S CHOICE
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Lex: Vivendi / GVT - Nov-16

Also weighing on the banks was last week’s European Commission estimate thatGreece’s deficit would reach close to 13 per cent this year.

The National Bank of Greece fell 6.8 per cent to €22.62 and Alpha Bank declined 2.6 per cent to €10.54. Piraeus Bank, which is set to release third-quarter results on Thursday, lost 6.4 per cent to €10.5 and EFG Eurobank, which separately announced the replacement of two of its executive committee members, was down 7.1 per cent to €9.57.

Financials were also down in Ireland, where the ECB is helping the country create a “bad bank” for toxic assets. Bank of Ireland was 5.4 per cent weaker at €1.78 while Allied Irish Banks fell 4.5 per cent to €1.85.

ft.com/cms/s/0/f59b626a-d299-11de-af63-00144feabdc0,s01=1.html?nclick_check=1

CaveCanem · December 8, 2009, 11:59am

Acropolis Now!
**(I know. Shameless) **

Greece warned about credit rating risk
Greece’s financial difficulties escalated on Monday after it was warned of a possible credit rating downgrade and Jean-Claude Trichet, European Central Bank president, said Athens would have to act “courageously” to bring its budget under control.

Interest rates on Greek bonds surged back close to their highest levels for seven months after Standard & Poor’s put Greece’s A minus credit rating on “negative watch”, which usually leads to a downgrade within a month.

Separately, Mr Trichet hinted that action taken by the new Greek government was not yet enough to bring the crisis under control. Calling Greece’s situation “very difficult”, he told the European parliament “we all know the very important and courageous decisions that will have to be taken”.

ft.com/cms/s/0/f9b2c120-e36c-11de-8d36-00144feab49a.html

https://media.bonnint.net/apimage/474f6deb-340c-4442-9a63-5a044152b8e6.jpg

El_Stuntman · December 8, 2009, 2:53pm

you sir, are a disgrace to this forum

Inis_Man · December 8, 2009, 3:07pm

If only they could find some Wall St. type to buy their bonds, someone like Gordon…Greco!

yoganmahew · December 8, 2009, 3:09pm

Fitch have downgraded to BBB+
S&P have on creditwatch negative.
Moody’s have on double secret probabation with knobs on.

El_Stuntman · December 8, 2009, 3:16pm

All aboard the Contagion Express?

Dubhgeannain · December 8, 2009, 4:18pm

rte.ie/business/2009/1208/greece.html

I don’t think a Garda strike would help matters here either. Either way I’ve got my looting kit packed and ready to go

yoganmahew · December 9, 2009, 11:26am

ftalphaville.ft.com/blog/2009/12 … -the-word/
Greek 10 years out to 5.4%

Lovely words from the finance minister:

“I’ve said all these things telling you it’ll be fine and then I go and spoil it all by saying you can’t believe a word I say…”

I’m torn between “Don’t believe a word” and “Grease”…

Oh well, inner gay time…

verbatim · December 9, 2009, 11:38am

Former BOE Official Buiter Says Greece May Be First EU Default

By Svenja O’Donnell and Elliott Gotkine
Dec. 9 (Bloomberg) – Former Bank of England policy maker
Willem Buiter said Greece may be the first major country in the
European Union to default on its debts since the aftermath of
World War II.
“It’s five minutes to midnight for Greece,” Buiter, who
will join Citigroup Inc. as its chief economist next month, said
in a Bloomberg Television interview today. “We could see our
first EU 15 sovereign default since Germany had it in 1948.”
The EU’s economic affairs commissioner said late yesterday
that officials are ready to help Greece with its budget deficit
after concerns about its public finances sparked a rout in Greek
government bonds. Fitch Ratings cut its rating on the nation’s
debt yesterday to BBB+ and two other major ratings companies are
threatening to follow.
“Default is not unavoidable,” Buiter said. “But unless
there are radical fiscal actions, lasting cuts in spending and
tax increases of at least 7 percent of GDP, the writing is on
the wall” for Greece.

goldmanberg · December 9, 2009, 11:47am

rte.ie/weather/presenters/byrnej.html

Sorry, couldn’t resist.

Puck_may_be_Famous · December 9, 2009, 11:49am

Former BOE Official Buiter Says Greece May Be First EU Default

By Svenja O’Donnell and Elliott Gotkine
Dec. 9 (Bloomberg) – Former Bank of England policy maker
Willem Buiter said Greece may be the first major country in the
European Union to default on its debts since the aftermath of
World War II.
“It’s five minutes to midnight for Greece,” Buiter, who
will join Citigroup Inc. as its chief economist next month, said
in a Bloomberg Television interview today. “We could see our
first EU 15 sovereign default since Germany had it in 1948.”
The EU’s economic affairs commissioner said late yesterday
that officials are ready to help Greece with its budget deficit
after concerns about its public finances sparked a rout in Greek
government bonds. Fitch Ratings cut its rating on the nation’s
debt yesterday to BBB+ and two other major ratings companies are
threatening to follow.
“Default is not unavoidable,” Buiter said. “But unless
there are radical fiscal actions, lasting cuts in spending and
tax increases of at least 7 percent of GDP, the writing is on
the wall” for Greece.

“Man in blazing house warns of smoke rising from neighbour’s garden shed”

Sterling is on borrowed time.

yoganmahew · December 9, 2009, 11:54am

Thanks for the miss whip back into shape!

Dreaded_Estate · December 9, 2009, 12:45pm

Greece has just made it in to the top 10 most likely to default soverigns

creditma.com/market-data

Entity Mid Spread CPD (%)
Venezuela 1321.86 59.42
Ukraine 1349.90 55.25
Argentina 1059.57 50.53
Pakistan 687.50 36.24
Dubai 596.32 33.62
Latvia 551.49 30.77
Iceland 397.36 23.48
Lithuania 321.25 19.59
California 238.50 18.65
Greece 228.83 18.04

Mark · December 10, 2009, 4:44pm

rte.ie/business/2009/1210/greece.html

Thats about 130% of their alleged GDP.

undertone · December 10, 2009, 4:53pm

Is Greece’s public sector debt really €300bn?! A nation of under 12 million people with a debt like that puts our debt into perspective.

yoganmahew · December 10, 2009, 5:01pm

Yeah, we’re a nation of 4 mn people with a debt of 106.7bn… excluding NAMA…

But hey, we’re loike rully rully productive, so loike ur GDP per cap-it-a is crackin’…

undertone · December 10, 2009, 5:08pm

300bn - 12m, 106bn - 4m.

So we’re worse off, (excluding NAMA).

106bn?

2Pack · December 10, 2009, 5:26pm

Greece is a mess, while they may ( just about ) have correctly told us an approximation of their debt the simple fact is that you can trust nothing the Greeks came out with. Greek official statistics are cooked on an epic scale.

The last time the Greeks were caught hard at it was when Eurostat went after them over their ‘deficit’ figures.

Eurostat published this fascinating summary of their dealing with the Greeks exactly 5 years ago. Evidently the Greeks did not care what Eurostat thought of them and carried on cooking the books since.

epp.eurostat.ec.europa.eu/cache/ … ECE-EN.PDF

The government deficit for 2003, which was initially reported at 1.7% of GDP, stood at 4.6% of GDP after the September 2004 notification. The deficits notified to the Commission for 2000, 2001 and 2002 were also revised upwards by more than two percentage points of GDP. Such substantial increases resulted from earlier actions undertaken by Eurostat as well as initiative taken by the incoming Greek government in spring 2004 to launch a thorough fiscal audit.

Revisions in statistics, and in particular in government deficit data, are not unusual. After the publication of the first outcomes in March by the national statistical institutes, data are often revised because new information comes available, or because errors are detected1. However, the recent revision of the Greek budgetary data is exceptional. Figures for 2003 were revised by almost 3 percentage points of GDP. The government debt figures were also significantly revised (by more than 7 percentage points).

In a nutshell , lies , damn lies, statistics, Greeks.