The satirists at The Daily Mash had fun with the European financial crisis a few days ago with some schtick on “Greeks Apologize With Huge Horse”:
THE nation of Greece said sorry to the European Union with a present of an enormous wooden horse.
Left outside the European Central Bank in the dead of night, the horse has now been moved into the ECB’s central lobby where it is proudly on display.
A gift tag attached to the horse, which is surprisingly light for its size and has small holes along the length of its body, suggested that it should be placed in the bank’s vaults overnight to avoid it being targeted by thieves.
Mario Draghi, President of the ECB, said: “How nice of the Greeks to acknowledge the trouble we’ve been put to on their behalf with this wonderful horse, handmade and so large it could hold a dozen double-decker buses.
“The card with it, which had a teddy bear dressed as a hobo on the front, explained that Greece made us this because they don’t have enough money for a present, which brought a tear to my eye.
“Nonetheless, unless they can somehow find €200 billion overnight then austerity measures must continue.”
Oddly, Greek representatives in Brussels have hinted that they may soon be in a position to settle their debts and have puzzled the French and German banks that hold their loans by asking if there is any discount for cash.
Yes, yes, ho-ho and all that. But then the Financial Times reported overnight about a “secret” infusion of 140 billion Euros to prop up the liquidity of Greek banks, which are suffering a run right now (along with how many Spanish and Italian and Portuguese banks??). And just how is it a “secret” if it’s in the newspapers? This doesn’t sound good:
The ECB’s weekly statement on banks’ use of emergency liquidity assistance (ELA) showed a spike at the end of last month.
Analysts at Barclays now believe Greece is now using 96 billion euros in ELA, with Ireland accounting for another 41 billion euros and Cyprus 4 billion euros.
If correct, the total ELA in use has exceeded 140 billion euros – more than 10 per cent of the amount lent to euro zone banks in standard monetary policy operations.Such an amount would require the approval of the ECB’s 23-member general council because of the risk of increasing inflation as a result of providing extra liquidity above 50 billion euros.
In Greece itself, the head of the county’s radical left party traveled to Paris on Monday to try to consolidate support from political allies for rejecting the terms of the country’s bailout package, ahead of general elections that could decide the destiny of Greece in the euro zone.
“I don’t know if we have scared Europe, but judging by your presence here today, we have surprised it,” Alexis Tsipras, the 37-year-old leader of Syriza, told journalists at the French National Assembly.
If that wasn’t ominous enough, the next paragraph should sound the alarm bells:
Meanwhile U.S. president Barack Obama urged Europe to strengthen its defenses against financial market turmoil as he brought a four-day G8/NATO meeting of world leaders to a close in Chicago.
“I do sense greater urgency now than perhaps existed two years ago or two and a half years ago,” Obama said.
Of course, that “sense of urgency” is his re-election.
By the way, buried near the end of the CNBC story about the Eurozone crisis is this fascinating little tidbit—make of it what you will:
Away from the euro zone crisis, China can now reportedly bypass Wall Street when buying U.S. government debt and go straight to the U.S. Treasury, in what is the Treasury’s first-ever direct relationship with a foreign government, according to documents viewed by Reuters.
The relationship means the People’s Bank of China buys U.S. debt using a different method than any other central bank in the world.
Did somebody say “buy gold”??