Closed Live – Greece crisis negotiations

After another day of negotiations the Greek government has failed to reach an agreement with its bailout monitors – the International Monetary Fund, the European Commission and the European Central Bank – on Athens’ reform plans.

Eurozone finance ministers are going to meet again on Saturday to try and broker a deal before the Greeks’ June 30 deadline to repay €1.5bn to the IMF.


Morning all, after the lack of progress yesterday, both sides’ patience appears to be wearing thin. Few people are expecting a deal any time soon but wonders never cease.

The markets certainly are not hanging out the metaphorical bunting. Michael Hunter reports:

Greece’s main equities index is falling, but by a small amount in the context of its recent dramatic swings. The Athens General is down 2.1 per cent in opening trade at 764.16.

Banks are once again crowding onto the list of the session’s biggest fallers. National Bank of Greece is down 5.2 per cent, Eurobank Ergasias is down 5.1 per cent and Bank of Piraeus is 4.5 per cent weaker.

The yields on Greek government bonds are rising and investors continue to cut their exposure to the country’s debt. Government paper due in 2017 is yielding 22.43 per cent, up 25 basis points, while the yield on 10-year paper is at 11.052 per cent, up 45 basis points.


And on a more global level, Jamie Chisholm writes:

Deal on. Deal off. Investors’ risk appetite continues to fluctuate with every burst of hope and pulse of despair for whether Athens can reach a “cash for reform” deal with its creditors.

And today, so far, it is pessimism flavouring the market tone after another day of negotiations passed with little sign of concrete progress.

The pan-European FTSE Eurofirst 300 is down 0.3 per cent and the 10-year German Bund yield, which moves inversely to the price, is easing 1 basis point to 0.83 per cent. The euro, which has managed to stay above the fray during the latest bout of angst, is up just 5 pips to $1.1210.


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The latest from Peter Spiegel and Alex Barker in Brussels

Greece is down to its final hours for negotiations over its soon-to-expire bailout, with creditors giving Alexis Tsipras, the Greek prime minister, until 11am Brussels time to come up with a workable economic reform plan to release €7.2b in desperately needed rescue aid.

According to two senior eurozone officials, if Mr Tsipras fails to reach an agreement – which people briefed on the talks said now was likely after fruitless all-night talks – the creditors’ offer will be presented to eurozone finance ministers for a “take it or leave it” choice by Athens.

“The Greeks didn’t move at all,” said one senior official of the talks between Mr Tsipras and the heads of the European Commission, International Monetary Fund and European Central Bank, which stretched into the early morning hours before breaking up and resuming at 9am.

“The level of frustration is so high. I don’t see a deal,” the official added. “It’s looking pretty grim right now.”

Officials said the 18 eurozone finance ministers were united in their belief that Athens was to blame for the standoff and were prepared to put intense pressure on the Greek government to accept the creditors offer. Greece’s current EU bailout expires on Tuesday.

Without an agreement by finance ministers, officials said it could then be handed over to eurozone heads of government who arrive in Brussels later on Thursday for a regularly-scheduled EU summit.

A deal must be reached by Friday at the latest so that the Greek parliament has enough time to legislate the reform plan before other eurozone parliaments, including the German Budnestag, will approve an extension of the programme.


The markets are moving on Peter and Alex’s story, reports Kadhim Shubber.

Greek stocks are up in anticipation of an 11am Brussels deadline for

the country’s negotiations with its creditors.

The Athens General index has risen 1.64 per cent to 793.68, after

falling 2.28 per cent in earlier trading.

The same optimism is not apparent in sovereign debt yields, which are

up 14.4 basis points to 10.542 per cent on Greek 10-year bonds.


Kit Juckes, analyst at SocGen, has made the following comment this morning:

“The standard market assumption is (still) that a last-minute slightly-tarnished solution can be found. Deadlines aren’t quite as firm as they looked and even if takes a bit longer, they’ll muddle through. Is this near-universal view complacent, or is it simply natural when that’s been the modus operandi for European crisis-management all along? “


Claire Jones, the FT’s ECB correspondent, has heard from one source that the Bank of Greece did not ask for an increase in the limit of the emergency liquidity assistance (ELA) from the ECB. So it is still at around €89bn.


A moment of light relief…

James Crabtree the FT’s Mumbai correspondent has just sent us the following:

I was just down in Bangalore for the last few days. Someone there pointed me towards a much-admired new start-up in the city, which has developed clever software capable of turning workplace gmail into a kind of collective to-do list, but which may well now be regretting its choice of name……

grexit.com


More on the ELA.

Kerin Hope in Athens has heard that not only did the Greek central bank not make an ELA request today but that there were inflows of more than €100m yesterday – similar to the amount the day before.


So, the deadline passed almost half an hour ago and – perhaps not surprisingly, the ultimatum has moved a bit.

https://twitter.com/SpiegelPeter/status/614001298837532672


More from Peter Spiegel

While the 11am deadline passed without a deal, another EU official said talks were continuing and the two sides were exchanging papers in an attempt to pull together an outline of what was “feasible” so finance ministers would have a framework for their own negotiations.

As the 11am deadline passed, Athens had not yet signed on to what the official called a “feasibility blueprint” that negotiators were attempting to pull together before the eurogroup meeting.


Just to prove that it really is Groundhog Day in Brussels, here’s the best pic of the day from the Belgian capital (that’s related to the Greece talks, to be fair to city)


Another “gosh-that’s-not-a-surprise” bit of news.

Anne-Sylvaine Chassany has heard the eurogroup meeting has been pushed back half an hour to 1.30pm (12.30pm London time).


Markets update from Katie Martin

If traders and investors are freaking out about the last-minute brinkmanship on display in the Greek debt talks, they have a good way of hiding it.

Whether this is complacency or a sense that we’ve ‘seen this film before’ will become clear soon enough. For now, the key market levels are:

Safe-haven Bunds are flat, with 10-year yields at 0.84 per cent.

‘Peripheral’ bonds from the eurozone’s wobbly bits are a little weaker, but not dramatically so. Italian, Spanish and Portuguese 10-year yields are all around 0.05 percentage points higher.

Greek bonds are also weaker, but by their standards, not markedly so. The two-year yields are up by 0.18 percentage points (Higher yields reflect lower prices). The 10-year yields are up 0.14 percentage points.

The euro is 0.4 per cent lower at $1.1162, but the euro’s strange patterns of late make it hard to draw any conclusions from this.

In stocks, Germany’s Dax is flat, Spain’s Ibex is 0.12 per cent higher, while Italy’s FTSE Mib is up by 0.42 per cent. In Athens, stocks are down by a measly 0.49 per cent.


Henry Foy has been speaking to people at banks in Athens:

A steady stream of users at an ATM outside a bank in Athens’ leafy Victoria district, but customers walking away with rolls of euro notes said they were not panicking.

“We are not worried, everything is going to be fine. The banks have lots of money,” said Silvia, who withdrew a couple of hundred euros with her husband.

“There won’t be capital controls. It’s ok,” she said.

Well, that’s all sorted then.


Some more behind-the-scenes colour from Anne-Sylvaine Chassany, who has been told that while Tsipras and the institutions are still talking, the problem is a lack of political will on both sides. Tsipras came out of the negotiating room last night to phone French President François Hollande. Hollande urged him to continue to negotiate, while adding he understood Tsipras wanted to hold firm on small pensions. The French president encouraged the Greek PM to keep negotiating elsewhere.


Update to the below. Alex Barker adds that Tsipras has left the Commission HQ. Not sure where he’s gone – perhaps to lie down in a quiet room.


What’s in a wave – vine by Alex Barker


The Greek economy may be paying a heavy price for the government’s stand-off with international creditors, James Mackintosh reports.

Antonio Garcia Pascual, European chief economist at Barclays, says that without the new government and crisis, “Greece would have seen [GDP] growth north of 1 per cent and a primary balance probably around 2 per cent”.

Instead he expects second quarter GDP to shrink by about 0.4 per cent compared to the first quarter. “We’ve seen confidence tanking, we’ve seen tax revenue tanking.”

Rather than running a primary surplus of 2 per cent without doing anything, he estimates the Greeks will need to slash spending or raise taxes by €3bn to get a surplus of just 1 per cent, because of the impact on growth of a new round of austerity.


There’s been a lot of frenzied wire snaps, market activity and twitter hoopla in the last 20 minutes on whether there has been a deal or not. It’s as clear as… well, the FT’s currency correspondent Roger Blitz has summed it up pretty well:

https://twitter.com/rogerblitz/status/614018895368876032


Meanwhile, a group of leading UK-based economists has taken a very critical view of the proposal which the Greek government tabled at the start of the week.

The Centre for Macroeconomics (CFM) has conducted a flash survey of its panel of experts. The survey asked three questions – and 37 economists participated.

A large majority of respondents think that the agreement that has been on the table this week would have non-trivial negative effects on Greece’s economic growth.

Moreover, a majority think that such an agreement would reduce the amount of money that creditors would eventually receive.

Although quite a few respondents think that Greece could just as well throw in the towel and default on some of its debt right now, the majority think that this would not beneficial.

The full results of the survey are available on the CFM website:


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Jens Weidmann, president of Germany’s Bundesbank, made his fiercest criticism yet of the European Central Bank’s approval of up to €89bn in emergency loans for Greek banks, Claire Jones reports.

“The emergency liquidity assistance (ELA) – which was originally conceived as a temporary source of liquidity for financially sound banks in return for good collateral – has been provided for a protracted period of time and has become the banks’ only source of funding,” Mr Weidmann said in Frankfurt on Thursday. “This casts doubt on their financial solidity. The latter is especially undermined by Greek policy decisions that have sparked capital flight and large-scale cash withdrawals.”

Mr Weidmann added that banks receiving ELA should be prevented from rolling over illiquid t-bills of their sovereign. He also signalled he would reject any raising of the ceiling the ECB — along with other members of the troika — places on t-bill issuance. Some officials have proposed this as a means of bridge financing for Greece until a longer-term aid package is secured.

“It should be clear to all the parties to the current negotiations that the Eurosystem must not provide bridge financing to Greece even in anticipation of later disbursements,” the Bundesbank president said. “When banks without access to the markets buy debt of a sovereign which is likewise locked out of the market, taking recourse to ELA raises serious monetary financing concerns.”


Peter Spiegel has got hold of the creditor institutions’ document that is being submitted to the eurogroup meeting that’s due to start in 45 minutes. There’s lots of detail in it, so Peter’s done a separate blog post on it.

Here it is:

The ministers have been sent what one official termed a “feasibility blueprint” – but the Financial Times has obtained a copy and it looks very much like the version creditors annotated and sent back to Athens on Tuesday. We’ve posted a copy of the document here.

The first place to look is page three of the nine-page document, where the section on pension reforms begins. This has become the major sticking point between the two sides and, while it makes some concessions to the Greek government, it is very much in keeping with creditor demands that early retirement schemes be curtailed and the effective retirement age be raised very quickly.

Under the plan sent to finance ministers, Athens would ensure the retirement age is moved to 67 by 2022, significantly faster that Alexis Tsipras, the Greek prime minister, had sought. Originally, Athens was pushing for 2036, but Mr Tsipras’ compromise plan submitted on Monday moved that to 2025.

There is an important creditor concession in the pension reforms, too, though. Creditors have been trying to get rid of a “solidarity grant” programme that provides a top-up bonus to poorer pensioners, know by the Greek acronym EKAS, by 2017 at the latest. Athens had offered 2020. The new plan splits the difference and goes with December 2019.

The EKAS phase-out will start immediately, however, with the wealthiest 20 per cent of the recipients losing the benefit as soon as legislation is passed.

There are some other elements of the Greek plan that survived as well, including raising contributions pensioners must make towards healthcare form 4 per cent to 6 per cent.

The other major sticking point between the two sides has been an overhaul of Greece’s value-added tax scheme. Here, too, the plan makes some compromises to the Greek plan. Creditors had originally sought a simplified two-tier system with most goods taxed at the top 23 per cent rate. Creditors have now gone along with a Greek idea of a three-tier system, including a “super-reduced” rate of 6 per cent for pharmaceuticals, books and the theatre.

Importantly, the creditors have conceded on keeping electricity in a middle 13 per cent VAT rate, something Athens has long demanded. “Basic food” also goes into the middle rate, but it appears all other kinds of foods – including restaurants and processed foods – goes at the higher 23 per cent rate. Athens has attempted to keep process foods at the reduced middle rate.

Another blow to Athens: the creditors plan would strip out VAT exemptions for Greek islands. This is particularly sensitive for Mr Tsipras’s coalition partner, the Independent Greeks, who have argued it was unfair for some of Greece’s most remote islands to pay the same kind of taxes that mainlanders do.

On other tax matters, creditors keep Athens’ idea of raising corporate taxes from its current 26 per cent rate, but rather than moving it to 29 per cent as Mr Tsipras suggested, it would be 28 per cent under the creditors’ plan. Gone is the Greek idea of a one-time 12 per cent tax on all corporate profits over €500,000. But the plan keeps Mr Tsipras’s plan to raise luxury tax on yachts from 10 per cent to 13 per cent.


Kerin Hope in Athens has been hearing the latest from the Greek government on its view of the Brussels negotiations. From an official:

“The Greek side stood its ground on its proposals, which had been recognised last week as a basis for discussion.

“The proposals were made more detailed and were presented to the institutions (the commission, the European central bank and the IMF) and they will also be presented to the EU institutions.

“They are a completely realistic approach towards an immediate solution in the spirit of eurogroup’s Feb 20 agreement.

“The Greek side has shown a sense of responsibility and will for a solution. Now is the time when the sense of responsibility and will of each player will be judged.”


Elsewhere in the Southern periphery of the eurozone, Spain is on a roll, Tobias Buck reports.

The pace of Spain’s economic recovery continues to quicken, with new central bank estimates suggesting the country grew 1 per cent in the second quarter — the fastest rate of expansion in more than eight years.


There is still optimism in Brussels. Martin Schulz, the head of the European Parliament has been giving a press conference with Jean-Claude Juncker, the European Commission president:

https://twitter.com/OpenEurope/status/614027324049256448


Gloom alert:

The wires are reporting German finance minister Wolfgang Schäuble as saying:

“We have not made progress. The Greeks have moved backwards rather than forwards.”


More gloom, from Eurogroup president Jeroen Dijsselbloem:

https://twitter.com/OpenEurope/status/614032053483536384


Reports that the Greeks might also present proposals to Eurogroup don’t seem to be true.

https://twitter.com/ChassNews/status/614032556120535040


Paul Krugman has just weighed in on his New York Times blog, with a damning assessment of the creditors’ requests.

I’ve been staying fairly quiet on Greece, not wanting to shout Grexit in a crowded theater. But given reports from the negotiations in Brussels, something must be said — namely, what do the creditors, and in particular the IMF, think they’re doing? [...] At this point it’s time to stop talking about “Graccident”; if Grexit happens it will be because the creditors, or at least the IMF, wanted it to happen.


You’re unlikely to lose money betting on there being more Eurogroup meetings in the next week, if the Spanish finance minister’s got anything to do with it:

https://twitter.com/OpenEurope/status/614033463893692418


The markets don’t know what to think

https://twitter.com/FTMarkets/status/614034348904456192


More on the German finance minister Wolfgang Schäuble from the FT’s Stefan Wagstyl:

Arriving for the meeting, Schäuble spread plenty of doom and gloom. He said there had been “not much progress” and a “big difference” remained between Greece and its creditors. It was up to the Greeks to move, he warned.

“The Greek government should tell its people often and honestly what is at stake.”


Peter Spiegel reports that there has been confirmation that the Greeks have sent their own document to the Eurogroup.

Edward Scicluna, the Maltese finance minister, said his colleagues also received a separate proposal from Yanis Varoufakis, the Greek finance minister, about 30 minutes before the meeting started, and the Eurogroup would attempt to piece together where the differences lie between the two sides.

“It was very difficult to compare,” said Mr Scicluna. “The fact we are talking from the same book is positive”.


Alex Stubb, the Finnish finance minister, has just posted on Twitter the seating order at Eurogroup. Bon appétit!

https://twitter.com/alexstubb/status/614037989962969088


Update from the most optimistic person in Brussels:

https://twitter.com/ChassNews/status/614039657597247488


More from Anne-Sylvaine, who’s been following Mr Optimism, aka Pierre Moscovici, the EU, economy commissioner:

“I have come to present, with Christine Lagarde and Mario Draghi, the outline of an agreement from the institutions. The commission now wants us to reach a complete accord within the next hours.

“We have worked for 24 hours, the technical teams have worked all night. I think we have something that’s credible.

“These past months have been difficult, but I think it is still feasible. We need political will.

“We have had good exchanges of views [with the Greeks]. Our points of view are getting closer. We have some points of agreement.”

I guess the key word in all of this is “some”….


Ferdi, my fellow blogger, has put the distance between the Greeks and their creditors in an apposite perspective….

https://twitter.com/FerdiGiugliano/status/614040598073487361


If the below photo of IMF chief Christine Lagarde and Greek finance minister Yanis Varoufakis is anything to go by, you’d be forgiven for thinking a deal had been done.



More evidence of good humour from the finance ministers (and Lagarde)


Further to the photo posted 10 minutes ago, today is not the first time Lagarde and Varoufakis have posed for an eye-catching photo. This was taken four months ago:


Donald Tusk, the European Council president has, like Ferdi, gone all classical on his Twitter followers:

https://twitter.com/eucopresident/status/614054914390626305

Methinks Mr Tusk might not be in the Eurogroup meeting room….



George Parker the FT’s political editor, is also in Brussels – trailing David Cameron. He sends the following dispatch:

David Cameron arrived in Brussels determined to complete his diplomatic round of 27 fellow EU leaders to explain the broad outline of his planned renegotiation.

The biggest logistical headache was squeezing in a chat with Alexis Tsipras, the Greek prime minister, who had other issues on his plate, other than Mr Cameron’s proposed referendum.

But Downing St said Mr Tsipras did take a call from Mr Cameron before the summit began, in between talks on how to stop his country’s economy toppling over a precipice.

However Mr Cameron’s proposed reforms have been relegated to a sideshow at a summit dominated by the Greek crisis and Europe’s response to mass migration across the Mediterranean.


One of the commenters (see right) believes both Mr Tusk and Ferdi have got their classical analogies wrong when analysing the bailout talks.Swedes is plumping for Sisyphus (think rolling a big rock up hill forever) over Sophocles or Achilles.

Any other suggestions?


More from George Parker (and arguably surprise of the day) – Downing St says Tsipras spent more than 15 minutes talking to Cameron!


Stefan Wagstyl reports that German chancellor Angela Merkel appears to have been drinking her finance minister’s kool aid

Angela Merkel was not her usual positive self when she arrived for the summit. Eschewing her standard phrases – “step by step” and “where there is a will there is a way” – she said that negotiations over Greece had not made the necessary progress and: “In some areas, you have the impression that we have even gone backwards a bit.”.

She urged Athens and the bailout monitors to keep talking, saying that it was not for the government leaders meeting as the European Council to “intervene” in the negotiations.

Speaking about migration, she made a clear, if oblique, criticism of Hungary, for its decision to stop accepting asylum seeker sent back from other EU countries. She called for more “solidarity” in the union and said that the EU could “not afford” such tensions “between member states”.



The wires have been reporting that the Eurogroup meeting has been suspended “indefinitely”. Peter Spiegel is not convinced.

https://twitter.com/SpiegelPeter/status/614068869355835392


Anne-Sylvaine Chassany reports that French President François Hollande, who spoke to Alexis Tsipras last night, arrived at the summit in Brussels urging negotiators to reach a deal as soon as possible:

“We have nothing to gain to wait until the last hour. Greece does not have time.

“An agreement is possible – we need to let the negotiators complete those discussions.”


Peter Spiegel says the Eurogroup wil reconvene soon

https://twitter.com/SpiegelPeter/status/614075887588237312


The Athens stock exchange is holding its nerve in spite of a tense day.

https://twitter.com/YanniKouts/status/614076256049590273


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Reverse ferret!

Eurogroup seems to be over, Peter Spiegel tweets.

https://twitter.com/SpiegelPeter/status/614078008157192193


Alex Stubb, Finland’s finance minister, confirms that’s it for today.

https://twitter.com/alexstubb/status/614079701666148352


I hope you didn’t have many weekend plans….

https://twitter.com/SpiegelPeter/status/614080958480928768

Perhaps we should send the ministers to Glastonbury….


Exasperation is spreading to people with a record of crisis management

https://twitter.com/carlbildt/status/614082353355464704


Over to Washington, where an IMF press briefing has just ended.

Shawn Donnan reports that even if a deal is nigh, the IMF is not bending on its June 30 deadline for the next €1.5bn payment from Greece.

“Our expectation is that the payment will be made. We should just wait for June 30 and see what will happen… As a matter of longstanding policy the IMF does not extend payment deadlines,” said spokesperson Gerry Rice.

The spokesman also clarified what the IMF would do in case Greece missed its payment. The longstanding rules stipulate that the managing director has 30 days to notify the board if a country doesn’t make a deadline. That has been interpreted by some as giving some wiggle room to Greece. But Rice said that were Greece to miss its payment Christine Lagarde would likely not wait 30 days and would notify the board “promptly”.

However the IMF does not think this is a take-it-or-leave-it moment for Greece. Rice said: “The IMF doesn’t do take it or leave it. That’s not how we work with our member countries. It’s always give and take.”

Finally, the IMF has defended its tough stance in the Greek talks arguing that its responsibility is to be “even-handed” to all its members. This reflects concern among some developing world members that the IMF has been bending its own rules to help Greece and other euro area countries in recent years. “We are even-handed in the way we approach all our countries,” Mr Rice said.


An AFP reporter is going off piste in the classical analogy competition…

https://twitter.com/dannyctkemp/status/614086322706337792


I’ve come to the blog a bit late today as I was contemplating life outside the topsy-turvy world of Greece crisis talks. But I hadn’t gone far, in fact I was just around the corner (figuratively that is) where the FT’s Duncan Robinson is covering the main theme of the EU heads of government summit – migration.

As you can read here, not content with playing chicken with the euro, EU member states have demonstrated just how disunited they are on the issue of migration.

While the UK already has an opt out on EU migration policy, opposition from eastern European member states, including the Czech Republic and Hungary, has now forced Brussels to abandon a key element of its plan to address Europe’s migrant crisis after it dropped a proposal to force member states to share out 40,000 asylum-seekers more equally.

All in all it has not been a good day for the 28-member bloc that calls itself the European Union


Greek stocks ended the day largely flat after bouncing up and down in the uncertainty around the country’s negotiations in Brussels, writes Kadhim Shubber.

The Athens General index was up 0.1 per cent at 781.68, after falling 2.29 per cent in the morning and later peaking at 1.7 per cent. Greek banks were down 0.42 per cent.

Greece’s sovereign debt had a mixed day, with 2-year bond yields, which move inversely to prices, falling 25 basis points to 20.54 per cent but 10-year bond yields up 11 basis points to 10.51 per cent.


The Greek side certainly seem relaxed about the stand-off, or at least finance minister Yanis Varoufakis is trying to sound like he is:

https://twitter.com/dgatopoulos/status/614101007396655105


And it looks like Varoufakis’ boss, Alexis Tsipras, has found a couple of people to cheer him up

We’re wondering what the joke was and who cracked it: Italian PM Matteo Renzi or Germany’s Angela Merkel – please do send us your suggestions


Reuters has talked to one of Matteo Renzi’s economic adviser, who insists there is nothing unduly for Italy to worry about in the event of a Grexit (which by the way is still some way off if it were to happen) – here’s an extract:

FRANKFURT, June 25 (Reuters) – Italy is unlikely to be pulled into another crisis if Greece leaves the euro zone, Italian Prime Minister Matteo Renzi’s economic adviser said on Thursday.

Yorum Gutgeld, who is also Italy’s spending review commissioner, called for Greece “to make some serious reforms”, particularly in raising its retirement age, which for some Greeks is just 55.

In an interview with Reuters, Gutgeld said some impact might be felt if Greece were forced out the euro zone. But Italy – whose government debt is not much less than Greece’s – should not feel it more than anywhere else, he said.

“Frankly, we are not worried for us about a Grexit,” Gutgeld said on the sideline’s of the Institute of International Fianance’s annual meeting. “It will certainly not be a good thing for the euro, but I don’t think Italy in particular needs to be more worried.”


And in case you hadn’t spotted this post over on Fast – Washington is girding its collective loins and those of the rest of the world, apparently, for a possible Greek default


One of our readers – The Whip – has come up with a possible scenario for what was said between the leaders of Greece, Italy and Germany that caused such mirth – see the post at 5:11pm

Tsipras to Merkel: “Lend me a couple of hundreds billions to buy Italian debt; then Greece will repackage it with Goldman -at reduced fees, I am good at bargaining- and will sell them to German banks at a profit”.

Renzi: “Yes! Yes!; should I ask Hollande to join Italy in issuing more debt? Then maybe Germany would join the Club Med”.

Merkel: “Yes, yes, of course… (at least I know where to go on holiday now)”.


While almost all the focus has been on Greece and whether it can remain within the euro and indeed within the EU, we should remind you that there is an EU summit of national leaders starting in Brussels, at which UK prime minister David Cameron is launching his attempt to to renegotiate Britain’s membership of the EU ahead of a referendum on whether to remain a member that could be held as early as next year. To paraphrase Mr Oscar Wilde: “To lose one member state may be regarded as a misfortune; to lose two looks like carelessness.” The FT’s political editor George Parker and the European Diplomatic Editor Alex Barker inform us that Cameron will be toning down his rhetoric a bit about the need for “full on treaty change” and instead will be looking for legal assurances that any changes he does secure cannot be reversed. The full story will be coming soon, so do check the home page


And so we’re going to wrap up this blog at the end of yet another “make-or-break” day that again saw the eurocrats and politicians kick the proverbial can down the road as the differences between Greece and its creditors seemed unbridgeable. One eurozone official described the outlook as “bleak” with the finance ministers due to meet again on Saturday in an attempt to find common ground at the fifth time of asking this week.

If that meeting fails to produce an agreement , all sides would have to move to “plan B” that would attempt to prevent the anticipated Greek default on Tuesday from damaging the rest of the eurozone. Thanks for following us today.