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Merkel: You know what would be awesome? A financial transaction tax
Says the Chancellor at a party event, according to Bloomberg.
- Euro area must be built on trust
- EU aid group to Greece, Portugal, Ireland is right
- Euro area countries must do their homework
- Greece needs a state that functions properly
BBG: Greek debt swap law passes at committee level
- Will go to parliament for a final vote tomorrow
Fears no are that Greek banks will need even more money than expected for recapitalizations after the PSI was upped to 53.5%.
Obama roles out corporate tax plan
- Would lower top corporate tax rate to 28% from 35%
- Imposes global minimum tax
- Eliminates oil and gas tax breaks
- Lengthens depreciation schedule
Imposing a minimum global tax would be a great way to dive US domiciled business overseas…
Greece’s Samaras: It’s different this time!
New Democracy Party head Samaras says the second Greek bailout is different than the first. This time Greece won on the Eurogroup decision, he says. The second Greek bailout lacks a growth plan though he says (just like the first).
New elections will be held in the next two months, he says and will be definitive for the future.
Headlines via Bloomberg.
EU’s Barroso: Eu needs growth, not just discipline, sanctions
Hard to argue..
BBG: Papademos: Much work still to be done
- Conditions being created for growth, recovery
Baseline Troika scenario is 129% Greek debt-to-GDP
- A Troika debt sustainability analysis sees Greece’s debt-to-GDP at 129% in 2020.
- The analysis estimates 160% if recession deepens or reforms are not carried out
- Actions could bring debt to about 120% to GDP
- Restructuring accrued interest and lowering interst on bi-lateral loans could each shave 1.5 percentage points.
- Restructuring Eurozone central bank holdings could cut 3.5 pp
- ECB forgoing profits on its holdings could cut 5.5 pp.
The last one really gets me. How can they sit around the table and not insist that the ECB forgo its profits while asking bondholders to take a 70-75% haircut.
Schaeuble waves goodbye to Venizelos
Given that the meeting is continuing, this photo is likely a wave hello or something else but it’s still funny.
de Jager: Cannot approve bailout until Greece meets obligations
de Jager is Netherlands’ fin min and is quietly surpassing Schaeuble as the ‘bad guy’. He added that there has to be rigid and very strict implementation of EU demands.
At best, there will be some sort of conditional approval today. EUR/USD falls about 15 pips on these headlines to 1.3244.
Schaeuble sounds optimistic
His pre-meeting comments:
If there weren’t anything to discuss we wouldn’t have a meeting…Today we are aiming to finalise the decision on a new rescue package for Greece. The state secretaries have prepared it well but there are still some details we have to talk about.
We still need clarity on the involvement of private creditors about a programme to make sure that Greece will not exceed a debt level of 120 percent of GDP by the year 2020. There is still some work to do and we have to make sure that the programme is implemented. I’m confident.
His other comments seemed to indicate that he saw an escrow account as a done deal but others sound much less confident. The top issue is monitoring, or how the Troika will enforce austerity implementation. The secondary issue is finalizing the PSI. Third is official involvement.
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