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Greece
Greece’s new public television, EDT, has begun broadcasting news, more than two months after the government shut down the previous state broadcaster, ERT.
ERT’s 2,700 workers were all sacked in June, but carried on making shows for web streaming and satellite relay.
Greece’s conservative-led coalition said ERT cost too much in an economic crisis. A left-wing party withdrew from government in protest at the closure.
The European Broadcasting Union stopped ERT relays when EDT began airing news.
Greece’s new public television, EDT, has begun broadcasting news, more than two months after the government shut down the previous state broadcaster, ERT
Greek authorities recently announced that more than 500 people had been hired on a two-month contract for the new state broadcaster.
Its first news programme was a two-hour broadcast that began at 08:00 local time. The show was presented by two journalists who used to work for ERT.
Since it went on air for the first time last month, EDT has been mainly showing old Greek black-and-white films.
Union representatives at ERT have vowed to continue their programming via the internet, the Associated Press news agency reported.
European Broadcasting Union (EBU) representatives had visited Greece frequently to meet government officials and express disagreement with the decision to close ERT.
Former employees at ERT’s headquarters had called on the EBU to keep the channel’s signal alive through its satellites.
The International Monetary Fund has admitted that it made mistakes in handling Greece’s first international bailout.
The IMF said it was too optimistic in its growth assumptions and said a debt restructuring should have been considered earlier.
Greece was granted a 110 billion euro ($145 billion) bailout by the IMF and EU in May 2010.
Another 130 billion euro rescue package was approved in February 2012.
Greece’s first bailout came amid fears the country would default on its debts and that it could spark debt contagion in the eurozone.
The IMF has now released a study looking at the handling of the programme.
It admitted that it bent its own rules on exceptional access for the programme to go ahead.
To justify exceptional access, one of the four criteria that must be met is that public debt is sustainable in the medium term.
But the IMF said: “Even with implementation of agreed policies, uncertainties were so significant that staff were unable to vouch that public debt was sustainable with high probability.”
But staff wanted to go ahead with exceptional access because of fears that any spillovers from Greece would threaten the rest of the eurozone and the global economy.
The IMF then amended the criterion to where debt was not sustainable with high probability, “a high risk of international spillover effects provided an alternative justification”.
The IMF has admitted that it made mistakes in handling Greece’s first international bailout
The IMF described the programme, which ran from May 2010 to March 2012, as a “holding operation” that gave the euro area “time to build a firewall to protect other vulnerable members and averted potentially severe effects on the global economy”.
It said it had notable successes such as achieving strong fiscal consolidation, Greece remaining in the eurozone and any spillovers that might have had a severe impact on the global economy were relatively well-contained.
But it also said there were notable failures, chiefly market confidence was not restored, the banking system lost 30% of its deposits and the Greek economy experienced a much deeper-than-expected recession.
Greece’s economic output (GDP) in 2012 was 17% lower than in 2009, compared with the IMF and EU’s initial projection of a 5.5% decline. The original growth projections were not marked down until the fifth review in December 2011.
The unemployment rate in 2012 was 25%, compared with the original programme projection of 15%.
The IMF added that in future Fund staff should be more skeptical about official data.
The Fund also criticized the delay in restructuring Greece’s massive debt load by forcing private holders of Greek bonds to take losses, which eventually took place in the first half of 2012.
“Not tackling the public debt problem decisively at the outset or early in the programme created uncertainty about the euro area’s capacity to resolve the crisis and likely aggravated the contraction in output,” the report said.
It said an upfront debt restructuring would have been better for Greece but this was “not acceptable to the euro partners”, some of whose banks held large amounts of Greek government debt.
The report also said there was no clear division of labor between the IMF, the EU and the European Central Bank, the so-called “troika”.
It said that while there were “occasional marked differences of view” within the troika, these were generally not on display to the authorities so did not risk slowing negotiations, and noted that “co-ordination seems to have been quite good under the circumstances”.
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An International Monetary Fund (IMF) report has revealed today that debt-laden Greece has made progress in improving its finances, but the country must do more to fight tax evasion.
In a report, the IMF said Greece had made “exceptional” progress on reducing its budget deficit since 2010.
But the IMF, one of the lenders that backed a bailout of Greece, said the “notorious” problem of tax evasion was still a major issue.
Also, Athens was still too slow to cut public sector jobs, the IMF said.
IMF report revealed Greece has made progress in improving its finances, but the country must do more to fight tax evasion
Cutting the budget deficit and making its economy more competitive were key conditions of the 240 billion-euro bailout from the European Union and the IMF.
“Progress on fiscal adjustment has been exceptional by any international comparison,” the IMF said in its report, which followed a visit by officials to the country.
“Greece has also made a significant dent in its competitiveness gap,” the report said.
But the IMF added that “insufficient” structural reforms have meant that deficit cutting has been achieved primarily through cutting jobs and salaries bringing “unequal distribution of the burden of adjustment”.
The IMF also said that “very little” had been done to tackle Greece’s “notorious tax evasion,” with the rich and self-employed “simply not paying their fair share” as austerity unfairly hits mostly public sector workers earning a salary or a pension.
It also called on the government to strengthen the independence of the tax administration to make it easier to reform the system.
On public sector jobs, the IMF said Greece is too reliant on voluntary departures.
“The taboo against mandatory dismissals must be overcome,” the report said.
Last month, the Greek parliament adopted a law that will allow the dismissal of 15,000 civil servants.
But under Greece’s current bailout plan agreed in November, Athens has to cut 150,000 public sector jobs overall from 2010 to 2015, about a fifth of the total.
Compulsory redundancies are a sensitive issue in Greece where unemployment has hit a record high of 27.2% and the economy is now in its sixth year of recession.
Last week, an EU report forecast that Greece would end years of recession in 2014 with growth of 0.6%, in line with an earlier forecast by the IMF.
Following what the IMF forecast will be a 4.6% contraction of the economy this year, the Fund warned that attempts to “artificially” stimulate growth should be resisted.
A fish pedicure in Greece on Monday left Kim Kardashian screaming in horror – and it was all caught on tape.
Khloe Kardashian filmed both Kim and Kourtney getting a fish pedicure – the treatment started off in Asia and has become a worldwide craze.
Kim Kardashian, 32, posted the footage on Keek on Wednesday and it was clear from the very beginning the star was not happy about her fishy pedicure.
“I’m about to do a fish pedicure,” she wrote.
Kim Kardashian – who showed off her growing bump in a short high-necked cream gown – immediately started screaming as the little fish nibbled away at the dead skin on her feet.
A fish pedicure in Greece left Kim Kardashian screaming in horror
“Oh my god, oh my god, I don’t like it, I don’t like it,” the reality star can be heard screaming in the video.
“Can I take them out, can I take them out?
“I hate it.”
The rest of the Kardashians tired to get Kim to go through with the procedure even yelling at her to keep her feet in.
“Kimberly stop,” Khloe Kardashian says off camera.
Kourtney Kardashian meanwhile took the pedicure in her stride, sitting calmly as the little fish went to work.
She does exclaim in the video however: “It is the weirdest thing ever.”
Always the joker in one of the Keek videos Khloe Kardashian takes viewers on a tour of the salon and declares that she “would need piranhas” to make her feet smooth.
It may have been a blessing in disguise that Kim Kardashian was not able to go through with the pedicure, as there have been numerous healthy warnings about the practice.
As the fish cannot be sterilized, there has been concern the pedicure can spread infections including, in the most serious cases, HIV and hepatitis C.
Specialists even recommended sufferers of psoriasis, such as Kim Kardashian, should never use the treatments.
Fish pedicures have been banned in some American states including Florida, Texas, New Hampshire and Washington.
Kim Kardashian has been in Greece with both her family and step father Bruce Jenner’s family for a holiday. She flew out to Paris, France, on Tuesday and then headed to England the following day.
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Riot police have stormed a metro train depot in Greek capital, Athens, breaking up a sit-in by striking workers.
The workers had been on the ninth successive day of strike action that has crippled the underground system.
The conservative-led government used an emergency law to threaten the strikers with arrest unless they went back to work. It was not clear if the move would lead to transport resuming.
Strikers are opposed to proposals which might see their salaries slashed.
The operation took place shortly before 04:00 local time, with around 100 riot police officers entering the depot where workers had barricaded themselves in overnight.
A police spokesman said three people were arrested and subsequently released. The area around the depot has now been cordoned off to prevent others from joining the strike.
Bus drivers and railway workers were to join the strike on Friday. Transport unions say they will continue their action, raising the possibility that some could face arrest and criminal charges, with a prison sentence of up to five years.
The government is using civil mobilization legislation, which has only been invoked nine times since the collapse of Greece’s military dictatorship in 1974.
Riot police have stormed a metro train depot in Greek capital, Athens, breaking up a sit-in by striking workers
Workers on the underground had been striking over a public sector unified wage scheme that would see their salaries reduced by up to 25%.
Public opinion is split over the issue, but with commuters facing long taxi queues as temperatures fall, the government feels that it may just get the support it needs to hold firm.
Greece has been kept solvent by huge rescue
loans from its EU partners and the IMF since May 2010.
So far, the European Central Bank, International Monetary Fund, and the European Commission have pledged a total of 240 billion euros ($315 billion) in rescue loans, of which Greece has received more than two thirds.
The Greek government required the bailouts because it was struggling to meet the interest payments on its existing debts.
Under the terms of the rescue funds, Greece is having to agree to substantial spending cuts, such as redundancies and pay freezes in the public sector, and reduced pensions.
This is having a major knock-on impact on the wider Greek economy, with the unemployment rate hitting 26.8% earlier this month, the highest figure recorded in the EU.
Greece is braced for a 48-hour general strike across public and private sectors in protest at a proposed new wave of spending cuts.
Protest marches – which regularly end in running battles with police – are planned for the centre of Athens.
The action coincides with a debate in parliament on the austerity measures, with a vote by MPs due on Wednesday.
Greece must back the measures, and the 2013 budget, to receive the next part of a bailout and avoid bankruptcy.
The latest strike starting on Tuesday includes public transport workers, lawyers, air traffic controllers, taxi drivers, journalists and hospital staff.
Some transport and media workers downed tools on Monday as well.
With proposals for a fifth consecutive cut to pensions, an increase in the retirement age and reductions to salaries, benefits and healthcare, the fury among Greece’s population is growing.
Greek ministers say the package should save a total of 13.5 billion euros ($17 billion) by 2016.
Approving the tough reforms and passing the 2013 budget are key to receiving a 31.5 billion-euro installment from the International Monetary Fund and European Union that has been on hold for months.
However, the Democratic Left Party which is the junior member of the three-party governing coalition, is refusing to back the package.
The second biggest coalition party, the socialist Pasok, is also facing a rebellion by some MPs.
Prime Minister Antonis Samaras has tried to reassure the public, who have endured repeated rounds of austerity and a five-year recession.
“These will be the last cuts in wages and pensions,” he said on Sunday.
“We promised to avert the country’s exit from the euro and this is what we are doing. We have given absolute priority to this because if we do not achieve this everything else will be meaningless.”
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Athens is tightening its security ahead of a visit by German Chancellor Angela Merkel, her first since the eurozone crisis erupted nearly three years ago.
Some 7,000 police officers are on duty, public gatherings are banned in certain areas of the city and protesters have been warned to “protect the peace”.
The visit comes as Greece bids to pass new cuts of 13 billion euros ($17 billion) to qualify for more bailout cash.
Analysts say Angela Merkel is regarded by many Greeks as the author of austerity.
While Germany has contributed the most money in the bailing out of Greece, its chancellor is held responsible for demanding that Greece make swingeing cuts in exchange for the financing it has received.
Analysts say Angela Merkel is regarded by many Greeks as the author of austerity
Speaking on Monday, Jean-Claude Juncker, chairman of the Eurogroup finance ministers of the eurozone, raised the pressure on Greece, calling on the government to demonstrate it could implement planned reforms “by 18 October at the latest” to qualify for the next bailout installment of 31.5 billion euros.
He was speaking as the eurozone’s new permanent fund to bail out struggling economies and banks was formally launched at the finance ministers’ meeting.
There has been growing unrest in Greece at the planned new cutbacks.
Police have banned protests on Tuesday in much of central Athens, and within a 100-metre (110-yard) radius of the route Angela Merkel’s motorcade will travel – although two planned protests elsewhere in the city will go ahead.
On Monday, public order minister Nikos Dendias appealed to protesters to “protect the peace, and above all our country’s prospects and our international image”, Reuters news agency reported.
Angela Merkel, a target for popular dissent, will be in Athens for about six hours, and will have talks with Greek Prime Minister Antonis Samaras.
The meeting is a gamble.
If there is chaos on the streets, it will only underline for the German public that Greece is a lost cause.
But Angela Merkel’s visit – her first to Greece in five years – is sending a symbolic message that she wants Greece to stay in the eurozone.
Meanwhile, the International Monetary Fund said on Monday that the global economic recovery was weakening, with government policies having failed to restore confidence.
It added that the risk of further deterioration in the economic outlook was “considerable” and had increased.
Greece’s finance minister Yannis Stournaras says the three parties in the country’s governing coalition have reached a “basic agreement” on the austerity package for 2013-14.
The measures are likely to be presented to Greece’s international lenders on Monday before going before parliament.
The cuts are necessary if Greece is to continue receiving bailout funds.
Earlier, Greece announced plans to sell most of its 34% stake in the gaming monopoly Opap.
Yannis Stournaras said there were “very few details left to work out” on the austerity package.
Greek governing coalition agreement comes the day after 50,000 anti-austerity protesters took to the streets of Athens
The deal comes the day after 50,000 anti-austerity protesters took to the streets of Athens.
The spending cuts are reported to be worth at least 11.5 billion euros ($14.8 billion) and are a condition for Greece to receive the next 31 billion-euro installment of its international loans.
The Greek government hopes to be able to present a final package of measures to the summit of eurozone finance ministers on 8 October.
Greek trade unions have begun the first general strike since the country’s conservative-led coalition government came to power in June.
Wednesday’s 24-hour walkout is to protest at new planned spending cuts of more than 11.5 billion euros ($15 billion).
The savings are a pre-condition to Greece receiving its next tranche of bailout funds, without which the country could face bankruptcy in weeks.
Large anti-austerity demonstrations are also planned.
Greek trade unions have begun the first general strike since the country’s conservative-led coalition government came to power in June
Greece needs the next 31 billion-euro installment of its international bailout, but with record unemployment and a third of Greeks pushed below the poverty line, there is strong resistance to further cuts.
The government of conservative Prime Minister Antonis Samaras is also proposing to slash pensions and raise the retirement age to 67.
Workers from a diverse range of sectors are taking part in the strike, from doctors to air traffic controllers.
It was called by the country’s two biggest unions, which between them represent half the workforce.
A survey conducted by the MRB polling agency last week found that more than 90% of Greeks believed the planned cuts were unfair and a burden on the poor.
With demonstrations planned, many people fear a repeat of the violence that has hit the streets in previous protests.
Thousands of police have been deployed in the centre of Athens to prevent a flare-up.
Greece is currently trying to qualify for the next installment of its 130 billion-euro bailout, which is backed by the IMF and the other 16 euro nations.
The country was given a 110 billion-euro package in May 2010 and a further 130 billion euros in October 2011. That money is paid in installments, but correspondents say the donors are reluctant to stump up the latest slice, as they feel Greece has not made enough effort to meet its deficit-reduction targets.
Greece needs the next tranche of its bailout to make repayments on its debt burden. A default could result in the country leaving the euro.
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German government has criticized leading conservative politician Alexander Dobrindt for suggesting that Greece will have to leave the eurozone.
Foreign Minister Guido Westerwelle said “bullying” of Greece must stop.
And in a TV interview Chancellor Angela Merkel said: “Everyone should weigh their words very carefully.”
Earlier, Christian Social Union leader Alexander Dobrindt, an ally of Angela Merkel, said he expected Greece to leave the eurozone in 2013.
He said he saw “no way round” a Greek exit. He also called the European Central Bank (ECB) chief Mario Draghi “Europe’s currency forger”.
His party, a junior coalition partner of Angela Merkel’s Christian Democrats (CDU), is preparing for an election in Bavaria and Germany’s general elections next year.
German government has criticized leading conservative politician Alexander Dobrindt for suggesting that Greece will have to leave the eurozone
Last week Angela Merkel reiterated that she wanted Greece to stay in the eurozone. And on Sunday she told German ARD television that “we are in a very decisive phase in combating the euro debt crisis”.
Greece is under pressure to speed up far-reaching reforms, including privatization and civil service job cuts, in order to continue receiving installments of its 130 billion-euro ($163 billion) international bailout.
It is the second massive bailout agreed for Greece since the 2008 debt crisis shook the global economy and German politicians have made it clear they will not stomach a third.
Guido Westerwelle warned that remarks like Alexander Dobrindt’s could harm Germany’s reputation as the eurozone tackles the debt crisis.
Comments by the head of Germany’s Bundesbank, Jens Weidmann, also signaled divisions at the top over the ECB’s handling of the crisis.
In early August Mario Draghi announced plans for the ECB to buy the bonds of countries like Italy and Spain, whose borrowing costs have reached levels widely regarded as unsustainable.
He is expected to give details after a 6 September meeting of the ECB’s governing council.
But Jens Weidmann, one of 17 eurozone central bank chiefs involved in ECB policy, said the plans risked making central bank financing “addictive like a drug” for struggling eurozone governments.
He warned that it was “close to state financing via the printing press” and could be a violation of EU rules preventing government-to-government subsidies.
Traditionally the ECB has been reluctant to undertake large-scale bond-buying because it is seen as inflationary, and the ECB’s priority is to keep inflation under control.
But during the eurozone crisis the ECB has been buying up sovereign debt to help ease the market pressure on struggling, debt-laden eurozone countries.
At the weekend the German and French governments indicated that Greece’s plea for a two-year “breathing space” in meeting its bailout obligations was unacceptable.
Eurozone leaders are waiting for a crucial report on Greece’s finances, due in late September. It will be delivered by the troika supervising Greece’s fulfillment of the bailout conditions – the ECB, International Monetary Fund (IMF) and European Commission.
Greece’s continued access to the bailout lifeline depends on a favorable report from the troika.
Athens is trying to finalize a package of 11.5 billion euros of spending cuts over the next two years.
European Commission President Jose Manuel Barroso is heading to Athens for talks on Thursday amid concern over whether Greece has done enough to get its next tranche of bailout loans.
It is his first visit for three years and he is expected to say the EU wants Greece to stay in the eurozone.
But there will be tough talking behind the scenes, analysts say.
Greece’s international lenders are also in Athens in an attempt to get deficit cutting measures “back on track”.
After months of political deadlock and two general elections earlier this year, Greece is struggling to meet the economic targets it has accepted as a condition of its bailouts.
Jose Manuel Barroso is heading to Athens for talks on Thursday amid concern over whether Greece has done enough to get its next tranche of bailout loans
Inspectors from the EU and the IMF are trying to work out whether or not Greece has done enough to receive its next tranche of loan money.
The European Commission says the country’s financing needs will be met in August, but a decision on further payments will have to be made in early September.
Without sufficient progress, it may not receive the final part of its bailout worth 31.5 billion Euros ($38 billion).
Earlier in the week, Prime Minister Antonis Samaras said Greece would suffer a much deeper recession than thought this year.
He expects the economy to shrink by 7%, greater than the 5% forecast by the crisis-hit country’s central bank.
Antonis Samaras said Greece would not return to growth until 2014.
He is expected to ask for more time to repay its loans.
Jose Manuel Barroso’s visit is overdue as Greeks often complain about European political leaders who spend plenty of time talking about them, and not much talking to them.
The Commission president is unlikely to be out and about shaking hands, but at least he will be in Athens to speak directly to the Greek people.
Jose Manuel Barroso’s spokesman said the purpose of his visit was “to meet Antonis Samaras and discuss the overall economic situation in Europe and in particular in Greece”.
He said it was “a regular meeting” and that the preparation for the talks had been “under discussion for some time”.
Right-wing New Democracy and left-wing Syriza parties are almost neck-and-neck after Greek parliamentary elections, according to the first exit polls.
Greece elections exit polls 75% at 19:00, local time:
New Democracy: 27.5-30.5%
Syriza: 27-30%
Pasok: 10-12%
Right-wing New Democracy and left-wing Syriza parties are almost neck-and-neck after Greek parliamentary elections, according to the first exit polls
Greek elections outcomes:
If pro-austerity parties (Pasok and New Democracy) win:
• Could have best chance of re-negotiating bailout
• May say austerity measures need longer time-frame
• But may need a third party to form majority
If anti-austerity parties (Syriza and others) win:
• Syriza threatening not to honor bailout
• If so, Greece could be forced out of euro
• Reintroduction of Drachma would lead to devaluation, inflation and business failures
• But could allow economy to grow
If there is a hung parliament:
• Third round of elections needed
• More political uncertainty
• Restricted access to bailout funds
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Political change within days in Greece may mean the country has to ultimately leave the euro.
If that was to happen, how would they go about introducing a new currency?
Greek voters could this week hand power to anti-austerity parties who want to scrap the bailout, the deal that qualifies Greece for vital eurozone funds.
This would bring the country a step closer to a possible exit from the euro. So how could a new currency like the drachma be (re)introduced?
A new government would have to produce enough new notes to replace those currently in use in Greece while also doing their best to prevent a run on the banks.
It would have to be introduced over a public holiday and there would be an interim phase between currencies.
The preparations would ideally occur in secret, says Jonathan Loynes, chief European economist of Capital Economics.
“If Greece were to introduce a new currency, they would have to impose some capital controls once the change had been announced. This would mean that people would only be able to withdraw a certain amount of money from their accounts, which would be necessary to keep things orderly and avoid a run on the banks.
“Then there would be some sort of public holiday during which banks and financial markets would be closed. In an interim period before the new currency is introduced, people could pay for things electronically or with small denominations of euros until the new currency became available.”
Political change within days in Greece may mean the country has to ultimately leave the euro
The new currency would then be introduced on a one-to-one exchange with the old, he says, but at some point the capital controls would be lifted and the new currency would sharply devalue.
This is what happened during Argentina’s economic crisis at the turn of the century. When the banking system came close to collapse, withdrawals were banned. The peso dropped in value, leading to high inflation, after Argentina defaulted on its public debt in 2002.
Recent reports have pointed towards English currency printer De La Rue as a possible source of new drachma banknotes.
Director of marketing for De La Rue, Rob Hutchison, will not comment on speculation that the company has drawn up a contingency plan for the production of new drachma, but he explains that the money-printing process itself can take several months.
“You have to consider the preparation of special banknote paper incorporating security features; the design of the notes; the process of bringing these elements together and then printing. It simply couldn’t be done overnight,” explains Rob Hutchison.
Economist and author of Greece’s Odious Debt, Jason Manoloupoulos, agrees: “I have heard that that the process could take anywhere between three to six months.”
So what is involved in the actual process of changing banknotes?
There is a lot to do, says Julie Girard, currency spokesperson for the Bank of Canada, which has been involved in that country’s recent transition from paper to polymer notes.
The many considerations in currency production range from the selection of the best base material and security features to the design on the notes.
“We have a team of chemists, physicists and engineers whose job it is to go out into the marketplace and see what types of security features are available, both in other currencies and through companies that produce security technology.”
These are assessed, as are different base materials to produce a cost-effective but secure note. Focus groups decide on designs and then notes are produced and distributed, says Julie Girard.
With so many cash transactions and withdrawals now taking place at ATMs and vending machines, these must be adapted to fit a new type of note.
“We spent about two years working with companies that produce machines which dispense, accept and sort paper currency, providing test notes and staff from the bank to help them. Some machines may have needed to be replaced, adapted or upgraded,” says Julie Girard.
Greece wouldn’t have the time that Canada did, but preparations may have been secretly going on for months.
Greeks have already reportedly begun to stash euros in safety deposit boxes and under mattresses.
These notes could be used to finance transactions even if another currency became the local tender, says Michael Massourakis, director of economic research for Alpha Bank, Greece.
“You can’t stop people using that money to buy things, even if you make it illegal to use foreign exchange in transactions. The euro could still be used afterwards on the black market, for example.”
But just how “new” would a new Greek currency be? Reports on Greece’s financial future concentrate on the idea of the drachma – the currency which was replaced by the euro in 2001. Could these old notes be re-used?
Although old drachma were still accepted in exchange for the euro by the Bank of Greece as recently as February 2012, most will have been shredded and burned, says the British Museum’s Thomas Hockenhull.
“If the original drachma printing plates still existed, it could be a fairly straightforward process to change the dates and use the existing machinery,” he says.
And coins may be ditched entirely. “They may just do away with coins and have only paper currency,” says Thomas Hockenhull.
“The cost of producing a coin can be more than that of making a paper note, because of the metal content.”
European markets have risen after a weekend poll in Greece showed growing support for a pro-austerity conservative party.
The survey suggested the New Democracy party could gain about a quarter of the votes, leaving it as the biggest party, albeit without overall control.
Elections are due to be held on 17 June.
London, Paris and Frankfurt stock markets all rose at least 1%.
European markets have risen after a weekend poll in Greece showed growing support for a pro-austerity conservative party
Spain’s leading IBEX index was out of step with the rest of Europe, falling by 0.5%.
Spain’s Bankia, which late on Friday asked for an injection of 19 billion Euros ($24 billion) in state support, fell 27% as it resumed trading on Monday. Its shares had been suspended on Friday pending the funding request.
Meanwhile, bond markets continued to reflect the tensions in the eurozone with the difference between the premium investors demand to hold Spanish government bonds and that of their German counterparts, at a record high.
The spread between 10-year Spanish and German bonds rose to 5.05 percentage points after Spanish government bond yields rose to 6.43%.
Italian government bond yields also ticked higher, rising to 5.87%.
London’s FTSE 100 share index was up 1%, Frankfurt’s DAX up 1.2% and Paris’s CAC 40 was up by 1.1%.
Although both Germany and France have a public holiday on Monday, their equity markets remain open.
Greece has set the new election date on 17 June and a judge has been appointed to head an interim government.
Council of State president Panagiotis Pikramenos will head the caretaker government until the election.
The election date was announced after party leaders met Greek President Karolos Papoulias on Wednesday.
Final talks to form a coalition failed on Tuesday, raising new concerns over Greece’s eurozone future. No party won a majority in the 6 May election.
There has been deadlock since the election over whether to continue with the austerity measures required by an international bailout agreement.
The uncertainty pushed the euro to a new four-month low against the dollar.
EU officials fear Greece will elect an anti-bailout government, which could trigger a Greek exit from the euro. That possibility is now discussed openly among Europe’s leaders.
But a senior adviser to European Council President Herman Van Rompuy played down that possibility on Wednesday.
Greece has set the new election date on 17 June and a judge has been appointed to head an interim government
On Wednesday the eurozone crisis pushed Asian stocks lower and knocked oil prices.
Tokyo’s Nikkei index dropped 1%, while Hong Kong’s Hang Seng and South Korea’s KOSPI lost about 3%.
The euro fell more than half a cent to $1.27.
Meanwhile the borrowing costs for Spain and Italy rose again, with Spanish bond yields hitting 6.5% and Italy’s 6.1%.
The uncertainty over the euro has also sparked concern over a run on the banks in Greece.
Greek newspapers report that around 700 million Euros ($897 million) has been withdrawn from high street banks over the past few days.
People are concerned that an exit from the eurozone and a reversion to the drachma would wipe out much of their savings, he says.
European leaders say they will cut off funding for Greece if it rejects the bailout agreed in March.
This would mean effective bankruptcy for Greece and its all but certain exit from the euro, analysts say.
German Finance Minister Wolfgang Schaeuble stressed again on Wednesday that there would be no new discussions on Greece’s bailout.
The head of the International Monetary Fund, Christine Lagarde, has raised the possibility of orchestrating an “orderly exit” for Greece from the eurozone.
“It is something that would be extremely expensive and would pose great risks, but it is part of options that we must technically consider,” she said on Tuesday.
After talks in Berlin with German Chancellor Angela Merkel following his inauguration as French president, Francois Hollande said he wanted Greece to remain in the euro.
Opinion polls suggest Greece’s leftist Syriza bloc, which came second in the 6 May vote and rejects all further cutbacks, could become the largest party after a new election.
Syriza wants to renegotiate the bailout package but also wants to keep Greece in the euro.
Pasok and New Democracy, which signed up to the bailouts and had previously dominated Greek politics for decades, saw their combined share of the vote drop from about 77% to about 33% on 6 May.
On Tuesday, Greece said it would make a “timely payment” on 435 million Euros’ worth of debt due on 15 May.
Greek moderate Democratic Left party says it will not join pro-bailout parties in a coalition without the more radical far left Syriza.
The Greek president has called the four main parties, including the centre-right New Democracy and the Socialist Pasok, to try to form an emergency government to avoid new elections.
But Syriza said it would not attend because it could not back any coalition which supported austerity.
A majority voted against last week.
Greek moderate Democratic Left party says it will not join pro-bailout parties in a coalition without the more radical far left Syriza
EU finance ministers are due to meet in Brussels to discuss the Greek crisis later on Monday.
The fear over holding new elections is that parties that oppose austerity measures that are a condition of Greece’s bailout deal might do well again in new polls.
And with no sign Europe’s leaders are prepared to renegotiate the deal, Greece could end up leaving the eurozone.
For the first time, some central bankers have spoken openly about the consequences of a Greek exit from the single currency.
Greek main parties have suffered dramatic losses in the parliamentary election, according to exit polls.
The latest polls put centre-right New Democracy in the lead with 19-20.5% of the vote, down from 33.5% in 2009.
Centre-left Pasok is put in third place with 13-14%, down from 43.9%. Syriza, a left-wing coalition, is put ahead of it in second place with 15.5-17%.
Pasok and New Democracy, in coalition since last November, were expected to lose support to anti-austerity parties.
There is widespread anger across Greece to harsh measures imposed by the government in return for international bailouts.
Syriza opposes the government’s austerity measures.
The neo-Nazi Golden Dawn party could enter parliament for the first time if the exit poll prediction of it winning 6.5 -7.5% of the vote comes to fruition.
Greek main parties have suffered dramatic losses in the parliamentary election, according to exit polls
The first official results are expected later on Sunday night.
“The truth is here – the reality of this result is that at the moment this produces no government,” said Theodoros Pangalos, outgoing deputy prime minister and senior Pasok official.
“It is not a question at the moment of who gets a little more or a little less.”
If no party wins enough votes to form a government, the winner will have to seek a coalition with rivals.
Coalition negotiations can take place over three days. If they fail, the party in second place can try to form a coalition, and if still unsuccessful, the third party will receive the mandate.
If still no coalition emerges, Greece will go to another election – a prospect which would alarm Greece’s international creditors.
The ability of any new government to carry on with the austerity programme will be crucial for Greece’s continued access to bailout funds from the EU, the European Central Bank and the International Monetary Fund – the so-called Troika.
Any political instability may prompt fresh questions over the country’s place in the eurozone.
Under the current plan, a further 11 billion Euros of savings in spending are due to be found in June.
Othan Anastasakis, director of south-east European studies at Oxford University, said it would be “incredible” if no party won more than 20% of the vote.
“This is really unprecedented,” he said.
“The whole landscape becomes even more unpredictable after the election. We don’t know if there will be a coalition or how long it will survive. I don’t see it surviving very long.
“Greeks are sending a very strong message abroad, which is <<enough with austerity>>.”
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Moody’s rating agency has cut Greece’s credit rating again, citing a risk of default despite a recent debt write-off deal.
Moody’s cut Greece’s rating from “Ca” to “C”, the lowest level on its scale.
The agency said on Friday: “Today’s rating decision was prompted by the recently announced debt exchange proposals for Greece, which imply expected losses to investors in excess of 70%.”
The deal writes off 107 billion Euros ($141.3 billion) of Greece’s debt.
Moody's rating agency has cut Greece's credit rating again, citing a risk of default despite a recent debt write-off deal
Moody’s said the planned debt exchange, which involves private investors of Greek debt writing off much of the 206 billion Euros in Greek bonds they hold, “would constitute a distressed exchange, and hence a default”.
The agency acknowledged that the deal was necessary to help stabilize Greece. But Moody’s said: “The risk of a default even after the debt exchange has been completed remains high. Moody’s believes that Greece will still face medium-term solvency challenges.
“The country is unlikely to be able to access the private market once the second assistance package runs out; and its planned fiscal and economic reforms will still face very significant implementation risks.”
Earlier this week the Standard & Poor’s agency classified Greek debt as in “selective default”.
Angry at the fate of the euro, Greeks are comparing the German government with the Nazis who occupied their country in the Second World War.
In a Greek newspaper some cartoons have presented modern-day German officials dressed in Nazi uniform.
Meanwhile, a street poster depicts Chancellor Angela Merkel dressed as an officer in Hitler’s regime accompanied with the words: “Public nuisance”.
Angela Merkel wears a swastika armband bearing the EU stars logo on the outside.
The campaign has been provoked by Germany’s role in driving through painful measures to stop Greece’s debt crisis from spiralling out of control.
Angela Merkel wears a swastika armband bearing the EU stars logo on the outside
Greek people are furious at the deal; even though it means the banks will write off 50% of the country’s debt and Socialist Prime Minister George Papandreou said his country had “avoided a mortal national danger”.
In the same time, Greek opposition blasted the landmark agreement, with conservatives warning it condemned the country to “nine more years of collapse and poverty”.
The Greek government officials, who agreed to the belt-tightening moves, have been also portrayed in cartoons giving the Nazi “Sieg Heil” salute.
Germany’s interference has revived historical enmities and evoked comparisons to the massive destruction of Greece at the hands of Hitler’s Germany more than 65 years ago.
Cartoons have sprung up depicting the European Union’s “troika” as ferocious soldiers in Second World War uniforms.
The liberal newspaper Eleftherotypia is regularly targeting Greek finance minister Evangelos Venizelos, who is often shown in cartoons making a Nazi salute.
One of the cartoons shows a German soldier watching over Minister Evangelos Venizelos as he barks at a Greek citizen to pay more taxes.
Another cartoon presents a young Greek answering a German soldier asking why there were no names on a list of Greece’s newly formed labour reserve, saying: “They are empty as you exterminated the Communists, the Jews, the homosexuals, the gypsies and the crazies last time.”
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