In keeping with the theme of hollow states, check out how the EU - a transnational actor primarily staffed by elites - is reacting to Greece's hollowing out:
How about that. The issuance of sovereign debt is theoretically something democratic leaders are supposed to debate in public. This controversy is more than the result of bond market vigilantes at work (we can see their handiwork as bond issuers get nervous about the ability of the market to handle more sales). Debt is now a football tossed around among transnational actors, in this case the EU's unelected bureaucrats and Goldman Sachs' unelected bankers and arbitrageurs.
One scholar in the article above calls for Greece's expulsion from the EU. This cry may rise to a cacophony in the coming weeks as Greece finds that its problems (like an epidemic of tax dodgers sapping its state revenue) aren't amenable to EU-friendly solutions. The pending defaults of other PIIGS nations will weaken the euro further.
Nota bene: Anthony J. Alfidi is short puts under EFA because he wouldn't mind buying into the Eurozone at much lower prices.
Greece turned to Goldman Sachs Group Inc. in 2002, just after adopting the euro, to get $1 billion in funding through a swap on $10 billion of debt, Christoforos Sardelis, head of Greece’s Public Debt Management Agency at the time, said in an interview last week. Eurostat, the EU’s statistics office, was aware of the plan, he said. Risk Magazine also reported on the swap in July 2003.
“Eurostat was not until recently aware of this alleged currency swap transaction made by Greece,” spokesman Johan Wullt said by e-mail yesterday.
How about that. The issuance of sovereign debt is theoretically something democratic leaders are supposed to debate in public. This controversy is more than the result of bond market vigilantes at work (we can see their handiwork as bond issuers get nervous about the ability of the market to handle more sales). Debt is now a football tossed around among transnational actors, in this case the EU's unelected bureaucrats and Goldman Sachs' unelected bankers and arbitrageurs.
One scholar in the article above calls for Greece's expulsion from the EU. This cry may rise to a cacophony in the coming weeks as Greece finds that its problems (like an epidemic of tax dodgers sapping its state revenue) aren't amenable to EU-friendly solutions. The pending defaults of other PIIGS nations will weaken the euro further.
Nota bene: Anthony J. Alfidi is short puts under EFA because he wouldn't mind buying into the Eurozone at much lower prices.
