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SYRIZA’s programme is worse than that of the Communists

27 November 2014 / 21:11:01  GRReporter
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If SYRIZA formed its own government, deposits would be withdrawn en masse and foreign investment in Greece would dry up, says Joerg Sponer, a senior manager in the Capital foreign fund. Sponer attended the presentation of SYRIZA’s economic programme in London, conducted by Giorgos Statakis and Yiannis Milios. SYRIZA’s headquarters, however, say that Sponer did not attend the London presentation of its programme by party representatives.

In his short memo, posted after the presentation, he maintains that the attending representatives of foreign funds sustained the impression they ought to sell everything they owned in Greece. The reason was, according to Sponer, that SYRIZA’s programme was even worse than that of the communists. Something else he shares with the stockholders and investors of the foreign Capital Fund is the opinion that if SYRIZA won an absolute majority at the elections there would be a repetition of the Cyprus scenario: mass scale run on banks, companies transferring whatever they could overseas and the ultimate termination of foreign investment.

In his confidential email, Sponer points out:

"Yes, I was at the meeting with Statakis (15 investors took part); I attended another meeting with Yiannis Milios, a senior financial adviser (with 20 investors).

In summary:

  • Everybody who came out of that meeting felt like selling everything they possess in Greece.
  • SYRIZA’s programme is worse than that of the Communists (they at least had a well-organised plan): chaos might only ensue if it were implemented.
  • If it wins 36.5% of the vote, which would imply an absolute majority (together with the bonus of 50 Parliament seats), we are going to witness a scenario pretty similar to the Cyprus one: mass withdrawal of bank deposits, companies transferring whatever they can overseas and the drying up of all foreign investment.
  • It is commonly believed that Prime Minister Antonis Samaras will not be able to gather more than 174 votes in March: written declarations have already been filed by deputies saying they won't support him.

If they weren't so serious while talking I would have thought the whole thing was a farce.

  • "We feel closer to the Spanish Podemos and Die Linke in Germany even though they are too liberal."
  • "We are going to stop the belt-tightening exercise: we even told people in the streets to hold their protests as we would take over and take care of them."

Five key points in their programme:

  1.  Putting an end to the humanitarian crisis by the free-of-charge provision of electricity, food, shelter and medical care to all those who need them.
  2.  Raising everybody's salary, with the minimum salary reaching €750 and being paid 14 months a year; pensions will hit €705 and be paid 13 months every year. Thousands of employees will be appointed by the civil service.
  3. Achieving a primary surplus in the vicinity of 1% through tackling the grey economy. There will be no motivation to join the grey economy as more people will receive a basic salary of €750 per month (extremely funny!). There will be no taxes on property (they are worth €2 billion). All taxes will be slashed by 20% apart from those on the highest incomes (worth €2 billion), and all expenses will be covered with the €70 billion unpaid taxes. SYRIZA expect that the country's GDP will increase by 3-5% after the party’s victory at the elections as SMEs will be able to invest in an atmosphere of complete trust (LOL here); an upsurge in foreign investment is also expected.
  4. Debt renegotiation:
  • The European Central Bank is going to buy out the whole Greek debt for 60 years and will abolish all interest (in 1952 Germany achieved a slashing of its debts in the order of 62%, therefore Greece should be allowed to achieve something similar.)
  • I pointed out that Germany at that time agreed to implement vast structural reforms but the two gentlemen (Milios and Statakis) retorted that Greece has seen too many reforms anyway.
  • Greece’s debt-to-GDP ratio will reach 205% until 2080. (hahaha -a terrific joke!)
  • The subsidies from Brussels will be increased by another €5 billion.
  • Nobody in Brussels is going to win anything if Greece is struck out of the Eurozone. It holds a large share of the Greek debt, but Tsipras made a mistake by agreeing with Angela Merkel for Greece to stay in the Eurozone.

5. A memorandum on private debt with maximum servicing of 20%, with disposable income in excess of €750 per month.

  • Credit analysis bureaus will be created to mediate between banks and borrowers. The bureaus will decide who will pay, what will be paid and what part of the debt will be forgiven.
  • The Financial Stability Fund will recapitalise banks with €3 billion, which will be lost during the first year and restored during the second year (the two gentlemen declared this in utter seriousness) as the Greek GDP is going to swell dramatically as foreign investment flows in.
  • The banks are too strong, and borrowers – too weak. They are going to change that.
  • The managements of the three large systemic banks in Greece are going to be reshuffled 100% (with the exception of Eurobank where the government does not hold a majority package any more).
  • Magistrates will be regimented into higher efficiency.
  • I couldn't invent all that even if I wanted to."

A blow from BofA-Merill Lynch as well: SYRIZA’s programme is an ancient Greek tragedy

Tags: SYRIZA economic programme Capital foreign fund Bank of America
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