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Saturday, September 22, 2012 10:52 AM

Greek Bailout on Hold Again, Is Obama Partly to Blame? IMF Economic Hit Man Hypocrisy

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Once again talks between the Troika and Greek politicians broke down. Talks between the Greek political parties have also broken down.

Meanwhile support for Golden Dawn, a political party with a Nazi-like symbol is on a huge upswing. For details, please see, Greek State Tries to Stem Neo-Nazi Rise.

Talks in Greece over the next tranche of loans are now on hold until after the US election. There were numerous reports this week that Obama did not want failed talks before the election, preferring instead they not fail until after the election when it will not matter to him.

Limits? What Limits?

The talks broke down when the Troika asked for more wage and benefit cuts.

The finance ministry says it can make the required savings from cuts in operational expenses and the restructuring of the public sector. But the troika of international lenders, especially the IMF, is unconvinced. It has asked for more wage and pension cuts, according to a person familiar with the talks.

Talk of tension between finance minister Yannis Stournaras and a member of the troika as well as strains within the coalition have fuelled rumours that talks have reached stalemate.

Fotis Kouvelis, the leader of the moderate Democratic Left party, said: “The troika must stop attacking Greek society. The troika must understand there are limits.”
Greek Bailout on Hold Again

So ... Greece Braced for Bailout Delay
No deal was clinched on Friday, and the troika’s chief inspectors announced a pause from the discussions. The troika said in a statement that the mission was expected to return to Athens after about a week, saying “good progress” had been made during this period.

People familiar with the situation said the US presidential elections had played a role in delaying the disbursement of the loan tranche to Greece, although others disputed this interpretation.

“Everything is being put back,” said one senior Greek official, insisting that the troika’s report and the disbursement of the loan tranche would take place after the US elections. “The disbursement may even be pushed back to late November.”
IMF, Economic Hit Man

Note the hypocrisy of the IMF, insisting Greece tackle its pension and deficit problems now, but urging the US to not do a thing about its problems.

I discussed this at length in Christine Lagarde, IMF Chief, Warns US About Short, Medium, and Long-Term Problems; Like All Keynesian Clowns, Lagarde Does Not Want to Deal With the Present.

The IMF is the protector of interests of big banks and does not give a rat's ass what small countries it destroys in the process. Bear in mind, Greece does need reform and plenty of it, especially in regards to pensions and work rules.

However, Greece does not need tax hikes and nor does Spain. Yet Brussels and the IMF have insisted on that, while openly cheering more deficit spending in the US.

Countries accepting money from the IMF on IMF terms are fools. Greece and Spain both need structural reforms, but they also need to default on foreign debt if they are to have any chance of recovery within a decade.

Mike "Mish" Shedlock
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