Global Analysis from the European Perspective. Preparing for the world of tomorrow




Grexit has never been from the table

TsiprasIn Gefira #0 we wrote that the Greek crisis was never solved. Greece is disconnected from the European banking system TARGET2, and capital control is still in place. Now Brussels is sealing off the border between Greece and Europe to stem the flow of refugees to the European heartland, severing Greece from the Schengen Area. It is not the question if the country will leave the euro but rather when it will start issuing the drachma. Tensions between Brussels, IMF, and Greece are increasing, implying a Grexit has become a contingency that one has to reckon with very seriously. A Grexit will strengthen the euro and increase its value against other currencies, as the euro bloc without Greece will become much stronger. That said, in the long run the euro has become a project that is crippling European economies.mapofgreece2

 

How Europe built fences to keep people out
Greece’s fence had a knock-on effect that continues to ripple through Europe as more countries wall themselves off. More migrants moving through Turkey began to enter Europe across the Bulgarian border, or by sailing to Greece in inflatable dinghies.Source Reuters

Tusk rejects Tsipras’s summit request but Dijsselbloem says Eurogroup may be held soon
Prime Minister Alexis Tsipras is due to speak to European Council President Donald Tusk again on Thursday after the latter rejected his call on Wednesday for a leaders’ summit to discuss Greece’s bailout talks and with a potential agreement between Athens and the institutions hanging in the balance. Source Ekathimerini

Greek National Bank chief: Greece could lift capital controls within months
Ms Katseli assured that after the recapitalization process, Greece’s banking system is on track and all problems are manageable. Nevertheless, she stressed that growth is impossible with capital controls. Source Tornos News

Greek bank deposits drop for third month in a row in March
Greek banks have seen only a trickle of deposit inflows eight months after the country clinched a third international bailout to stay in the euro zone. They remain hooked on central bank borrowing to plug their funding gap. Source Reuters

Greek retail sales fall 6.6 pct y/y in FebruaryGreek retail sales by volume
dropped 6.6 percent in February compared to the same month a year ago after an upwardly revised 1.7 percent decline in January, statistics service ELSTAT said.Source Reuters

Greek electronics retailer becomes latest casualty of economic slumpGreek home appliance retailer Electroniki shut down its 45 outlets nationwide on Thursday after a court ruled it was bankrupt, becoming the latest casualty of the country’s economic slump. Source Reuters

 

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Der Kampf gegen Bargeld geht weiter

People spend the night in front of ATMs with the hope that money will be brought there and they will finally be able to withdraw it after standing in line for many hours. Sometimes the fights break out, even among those waiting in front of the banks. Tensions reach their peak. Branches are set on fire and people all over the country take to the streets….

Scenes from Cyprus 2013? No. Nigeria, Laos, April this year. Old banknotes were invalidated in February and since then no new ones have been printed, only the old ones collected from the market by the central bank and destroyed. At the same time, they introduced central bank digital currency (CBDC), which was not accepted by the people at all. Over 200 million people were deprived of their money overnight. Almost no one wanted to pay or transact with the new e-currency (called eNaira). Thousands of businesses went bankrupt in a short period of time. A paradoxical situation arose in which gasoline could no longer be bought at gas stations in the country, which is one of the largest oil producers in the world.

Nigeria, with its 22o million people, has long since overtaken South Africa and is the largest economy on the Dark Continent. It is a country with huge raw material resources and a development potential that African mentality and corruption, which is present everywhere, wreck. It can be said that it is a rich country of poor people because almost all the capital is in the hands of politicians. One of them, the head of the Central Bank of Nigeria, Godwin Emefile, said in Davos that his country would soon be cashless and – lo and behold – that might end with blood in the streets. It is hard to believe that in a country where 32% of the people are illiterate, where most people do not have access to electricity, the idea of digital currency comes from below; that the shamans had whispered it in the ears of ordinary people. No, it comes from above and from outside. Third World countries have always been a training ground for Western elites, the grassroots movement of the new authoritarian world without cash. This time they are testing how far and how fast they are able to implement their ideas.

Finally, it should be remembered that the complete transition to cash, would make citizens transparent. Central banks could regulate digital money, depending on how they would like a citizen. It could also be that the validity of the money would be limited in time and could only be spent for certain purposes. Electronically, that’s easy to organize. How embarrassing that would be for the Germans, 58% of whom pay in cash! Nigeria has also been called the “cash king” in Africa.

The virtual world threatens the physical world. More on this in Gefira 73.

by The Board

The battle against cash goes on

People spend the night in front of ATMs with the hope that money will be brought there and they will finally be able to withdraw it after standing in line for many hours. Sometimes the fights break out, even among those waiting in front of the banks. Tensions reach their peak. Branches are set on fire and people all over the country take to the streets….

Scenes from Cyprus 2013? No. Nigeria, Laos, April this year. Old banknotes were invalidated in February and since then no new ones have been printed, only the old ones collected from the market by the central bank and destroyed. At the same time, they introduced central bank digital currency (CBDC), which was not accepted by the people at all. Over 200 million people were deprived of their money overnight. Almost no one wanted to pay or transact with the new e-currency (called eNaira). Thousands of businesses went bankrupt in a short period of time. A paradoxical situation arose in which gasoline could no longer be bought at gas stations in the country, which is one of the largest oil producers in the world.

Nigeria, with its 22o million people, has long since overtaken South Africa and is the largest economy on the Dark Continent. It is a country with huge raw material resources and a development potential that African mentality and corruption, which is present everywhere, wreck. It can be said that it is a rich country of poor people because almost all the capital is in the hands of politicians. One of them, the head of the Central Bank of Nigeria, Godwin Emefile, said in Davos that his country would soon be cashless and – lo and behold – that might end with blood in the streets. It is hard to believe that in a country where 32% of the people are illiterate, where most people do not have access to electricity, the idea of digital currency comes from below; that the shamans had whispered it in the ears of ordinary people. No, it comes from above and from outside. Third World countries have always been a training ground for Western elites, the grassroots movement of the new authoritarian world without cash. This time they are testing how far and how fast they are able to implement their ideas.

Finally, it should be remembered that the complete transition to cash, would make citizens transparent. Central banks could regulate digital money, depending on how they would like a citizen. It could also be that the validity of the money would be limited in time and could only be spent for certain purposes. Electronically, that’s easy to organize. How embarrassing that would be for the Germans, 58% of whom pay in cash! Nigeria has also been called the “cash king” in Africa.

The virtual world threatens the physical world. More on this in Gefira 73.

by The Board


 
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