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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