Talks to resolve the pressing issue of restructuring the privately held debt by Greece remain very slow and appear to no longer go ahead until there is no enough guarantees that Athens can implement more severe austerity reforms. Greece is getting ever closer to bankruptcy unless it can secure a second financing package from the euro zone and the IMF.
Amid this scenario, there seems to be very limited new information on the debt-swap front, as talks have stalled until the troika sees greater willingness to impose austerity. Nonetheless, the latest detail indicate that Athens is pursuing that banks, insurers and the ECB itself take losses of about 70% so that Greece can ease its 100 BLN EUR debt burden, with a 14.5 BLN EUR deadline due to be paid by mid-March.
UBS: “We believe the week ahead will be extremely significant for event risk and headlines could become a dominant driver for the euro.” Euro zone officials continue on a very hard-line stance refusing to accept any planned debt swap nor signing off a new fresh bailout until Athens can guarantee it would implement promised reforms.
Amidst warnings that Greece has reached its limit and is unable to accomplish any more austerity, the latest reports suggest that the Hellenic country will have until noon Monday to make a counter-offer to satisfy the Troika's demands, unwilling to yield an inch from their demands.
Greek Prime Minister Papademos has warned that the country's partners in Europe are starting to run out of patience. "There was a very clear message to the Greeks that enough is enough," one euro zone official told Reuters. "There is a great sense of frustration that they are dragging their feet."
Greek FinMin Venizelos warned that the stakes were rising as time ran out. "We are on a knife-edge," he told reporters. "The distance between the successful completion of the procedures and an impasse which could happen by accident or because of a misunderstanding is very small."
As reported by IFR Markets: “EU sources say Eurozone governments may now have to cough up an extra 15 BLN EUR on top of the 130 LN EUR agreed. The lenders have demanded extra spending cuts worth about 1 percent of GDP - or just above 2 BLN EUR - this year, including big cuts in defence and health spending.”
The failure to resolve all of the issues with the Troika and EZ countries has resulted in the meeting between the Greek PM and leaders from the socialist, conservative and far-right coalition to seek their blessing for reforms in the bailout to be moved from Saturday to Sunday
