Greece is preparing to default
Jun 16, 2015
The failure of the negotiations between Greece and the European Central Bank yesterday has resulted in both sides taking steps to prepare for default. It looks like Greece is anticipating that the ECB will use bank deposits in a “bail-in,” to help pay debts. So King World News shows the latest move that the Greek government has taken to get those deposits out of the ECB’s reach.
There is one last point about Greece worth mentioning, Eric: Greece is clearly preparing for a default.
The Athens government has asked all cities and other governmental bodies to move their available cash into accounts at the central bank. This is being reported in the mainstream media as a way for the central government to get its hands on more cash, but that is not correct.
It is to prevent the ECB from taking this cash of governmental bodies when the ECB finally bails-in the private Greek banks. In other words, in a bail-in the ECB takes the euros deposited in private banks, but not the euros deposited in the central bank. So by putting their euro deposits into the central bank, Greece’s governmental bodies can keep their money out of the hands of the ECB. It’s just more evidence that Greece – not the troika – holds all the cards."