Thursday, April 23, 2015

ECB: What if Greece Issues a Parallel Currency?

 A very interesting read!
Greece should issue it's own public currency.The ECB, however, is less enamoured of the idea, for what should be the most obvious reason.  It would be a publicly issued currency outside the grasp of global private central bankers

The European Central Bank has analysed a scenario in which Greece runs out of money and starts paying civil servants with IOUs, creating a virtual second currency within the euro bloc, people with knowledge of the exercise told Reuters.
Greece is close to having to repay the International Monetary Fund about 1 billion euros in May and officials at the
 ECB are growing concerned.
Although the Greek government has repeatedly said that it wants to honour its debts, officials at the ECB are considering the possibility that it may not, in work undertaken by the so-called adverse scenarios group.
Any default by Greece would force the ECB to act and possibly restrict Greek banks’ crucial access to emergency liquidity funding. (In other words the private banksters would have to crush Greece down)

Officials fear however that such action could push cash-strapped Athens into paying civil servants in IOUs in order to avoid using up scarce euros.(But if the private banksters crush Greece, then Greece will be left with no choice but to issue a public currency)
It appears the ECB has a dilemma.  If they push Greece to repayment, Greece may issue a parallel, public currency. If the ECB restricts Greek banks and liquidity funding, Greece may issue a parallel, public currency.

«The fact is we are not seeing any progress... So we have to look at these scenarios,» said one person with knowledge of the matter.
A spokesman for the ECB said it «does not engage in speculation about how specific scenarios regarding Greece could unfold.»
One Greek government official, who declined to be named, said there was no need to examine such a scenario because Athens was optimistic it would reach a deal with its international lenders by the end of the month.
Greece has dismissed a recent report suggesting it would need to tap all its remaining cash reserves across the public sector, a total of 2 billion euros, to pay civil service wages and pensions at the end of the month.
 Plundered savings
Experts at the ECB have concluded that using IOUs to pay public sector wages would probably fail to avert a full-blown crisis and could even threaten Greece’s future in the 19-country euro zone.
Those officials believe that up to 30 percent of Greeks would end up receiving such government IOUs rather than payment in euros, which would only put further pressure on Greek banks because those workers were likely then to plunder their savings.
The private banksters appear to have a real problem on their hands?
The banks would then be forced to tap increasing amounts of emergency liquidity funding or boost their capital base.
But the banks could not use the IOUs as security for drawing down the emergency credit because the ECB would not accept them.
«The IOUs, I just don’t think it can work,» said the first person who spoke to Reuters. «That could effectively be it, they would be out (of the euro).»
Those fears were voiced by others familiar with ECB thinking.
«With a parallel currency ... you are getting to something so tailored that you are almost in Grexit,» said a second person. «It is something that is outside the institutional set-up.»
Yes, it would be outside of the private institutionalized banker set up- It would however be a return to a public currency issued without debt. As was done in Canada, not so long ago. (And it worked beautifully here)
A default by Greece could force the ECB to intervene and insist that any security offered in return for emergency funding be cut in value to reflect the country’s default status.
Greek officials insist that there is no plan for default.
However in a recent letter from Greek Prime Minister Alexis Tsipras to German chancellor Angela Merkel, he said wages and pensions would have to take priority before repayment of debt if he was forced to make a choice.
The conclusions of the ECB’s ‘adverse scenario’ group is in line with the message euro zone officials have been sending to Athens for some time, namely that they should not go it alone with radical measures.
For the ECB, the introduction of a type of second currency in Greece would also hamper it in setting borrowing costs in the euro zone.


  1. Greece needs to call Iceland (Niceland).

    1. They sure do, and they need to have their own currency!

  2. I think from memory, the President has already offered Greece advice on what to do. It was a couple of years ago in a video interview. Did you feature it here, Pen?

    I copied an article by William Engdahl at Winter Patriot the other day with a couple of comments. Or you can read the original at F. William Engdahl - Iceland’s Economic Revolution

  3. President of Iceland, that is!

  4. Putting this here for the record
    Yesterday I mentioned the snow fall? Just a dusting
    Here's the temps for yesterday



    Here is where we are normally give or take a degree or two


    In April we have had so far a total of two days that actually equaled April weather
    In March, it was dam cold

  5. for the record again
    Brisbane and Queensland were hit with the chill too
    In Redcliffe it dropped to 11.3 degrees, their coldest night in six years."
    Other chilly minimums included 7.4 at Toowoomba, 6.3 at Dalby, 5.4 at Warwick and just 2.9 at Kingaroy.
    Coolangatta on the Gold Coast dropped to 8.1 degrees, its coldest April night in 16 years.
    The Sunshine Coast shivered through a 7 degree low, 10 degrees below average and the region's coldest April night in 20 years.
    "Maryborough had the coldest in at least 59 years with a low of 6 degrees, 11 below average, and Mackay was the coldest in 63 years with a low of 11," Mr Dutschke said.

    Realizing the Aussies are in their fall season, but cold records tumbling?

    Cold weather is driving natural gas prices higher

    Cold Weather Estimates Drive Natural Gas Prices Higher
    By Gordon Kristopher • Apr 22, 2015 9:27 am EDT
    Natural gas price evolution
    Below is our natural gas price fundamental analysis. For an in-depth look at natural gas and related companies, sectors, and drivers, please refer to our
    NYMEX-traded natural gas for May increased by 1.54% on April 21, 2015. Prices increased due to cold weather estimates. This could increase the demand for natural gas

    Ironically this continued cold is increasing demand for fossil fuel, which should drive global warming, according to the IPCC and all it's corrupt scientists, but it isn't! Cause like I said, we still have the furnace running April 24/2015
    It's been running non stop since October of last year- not normal at all!
    And not AGW either

    Sense a disconnect? Real world not in line with the spin


    Late April is starting to feel more like mid-winter for many parts of the U.S. this week. The Great Lakes and Northeast woke up to snow on Thursday morning and for some, it was actually the fourth day in a row of the wintry weather.

    "Since Sunday, it has snowed in at least 23 states, as far south as New Mexico, according to the national snow analysis from the National Weather Service. Northern Minnesota and Wisconsin have been seeing snow all week

  6. Hey All, apologies for no news post and not responding to commetns- been extremely busy, house reno type stuff and company from the West Coast of Canada- British Columbia- things will get back to normal soon enough
    thanks for understanding :)