Greece sovereignty massively limited by EU following bailout

The 5th bailout tranche to Greece, has now been approved.

From Reuters:

"Euro zone finance ministers agreed on Saturday to disburse a further 12 billion euros to Greece and said the details of a second aid package for Athens would be finalised by mid-September. After a conference call, the 17 euro zone ministers agreed that the fifth tranche of the 110-billion-euro bailout agreed with Greece in May 2010 would be paid by July 15, as long as the IMF's board signs off on the disbursement. The IMF is expected to meet on July 8 to approve it. The payment will allow Greece to avoid the immediate threat of default, but the country still needs a second rescue package, which is also expected to total around 110 billion euros and which will now likely only be finalised in September. Between now and then, finance ministers will work on the "precise modalities and scale" of the private sector's involvement in the second aid package, which Germany hopes will eventually total around 30 billion euros. Greece said it expected a final decision on a second bailout programme by mid-September to keep the country financed.


The question is how long will the money last, 1-2-3 months at best and then we are back again to square one.
Greece has 18.2 bn in debt payments in August, 12 billion clearly are not enough to cover the shortfall, where will they get the rest?


As if it was not enough 1 hour ago a new warning has been issued by the Eurogroup chairman Jean-Claude Juncker. He warned Greeks that help from the EU and International Monetary Fund would have unpleasant consequences.


"The sovereignty of Greece will be massively limited," he told Germany's Focus magazine in the interview released on Sunday, adding that teams of experts from around the euro zone would be heading to Athens.
"One cannot be allowed to insult the Greeks. But one has to help them. They have said they are ready to accept expertise from the euro zone," Juncker said.
Juncker also said Greece must privatize on a scale similar to the sell off of East German firms in the 1990s.
"For the forthcoming wave of privatizations they will need, for example, a solution based on a model of Germany's 'Treuhand agency'," Juncker said, referring to the privatization agency that sold off 14,000 East German firms between 1990 and 1994.
Athens must sell off 5 billion euros in state assets this year alone or risk missing targets set under its EU/IMF program, which could cut off its funding needed to keep the government running and avoid a debt default.
"The current package of measures, which Athens has agreed to, will bring a solution to the Greek question," said Juncker. However, he added that the Greek tax collection system was "not fully functional."
Financial markets still see an 81 percent chance that Greece will eventually default, and German Finance Minister Wolfgang Schaeuble told Der Spiegel in an interview that Berlin was making preparations for such an event -- even though it does not expect it to happen.

Travel Photo: Wadi Rum, Jordan

Wadi Rum, Jordan

DSK released after playing ball with the conspiracy

From the New York Times:


Dominique Strauss-Kahn was released from house arrest on Friday as the sexual assault case against him moved one step closer to dismissal after prosecutors told a Manhattan judge that they had serious problems with the case. 
Prosecutors acknowledged that there were significant credibility issues with the hotel housekeeper who accused Mr. Strauss-Kahn of trying to rape her in May. In a brief hearing at State Supreme Court in Manhattan, prosecutors did not oppose his release; the judge then freed Mr. Strauss-Kahn on his own recognizance. 
What surprise me of this entire story is the clear and manifest lack of subtlety in dealing with all the issue, all this story was stinking from the first moment when NYPD arrested the Head of the IMF in a very delicate moment for both the French Presidential Race and the Greek crisis.
You would imagine that professionals would have verified and double-checked the credibility of the accuser before moving charges and arresting the guilty party, if this is true for every case it is even more true when they were dealing with the potential next president of France and Head of the IMF.
This time though they started a very public stunt of arresting DSK before leaving the country, they sent him to to a maximum and infamous security prison and only after he relinquished his post he was given house arrest.
Then suddenly everyone forgot about him until today, 2 days after the election of the new IMF chief Lagarde (the Finance Minister of President Sarkozy) and 2 days after the Greek government has sold the entire country to the international banking system.
The date chosen for his release is rising even more doubts than the original plot to get him out of the IMF.
He could not be in time to run for president and maybe he was released before deadline simply to avoid an association of this plot with Sarkozy. What is clear is that both US and France wanted him out of the IMF (let us not forget he was an advocate of the end of the dollar as reserve currency) and that DSK has played along while being very quiet; his language has been pacate and he did avoid aside from the first days any publicity with the media. He could have started to release interviews and being vocal on why all this happened but he preferred not.
He knew most probably that he was being given a chance to get out of this conspiracy alive and quietly by playing ball with it and avoiding any fight.
It happened effectively as I thought that charges would be dropped and he would be a free man once he would have relinquished his position. I thought it would have taken more time in order to avoid ringing bells of a conspiracy, but this was not the case.
They have preferred to send a public message. The message it was sent today  is clear: we can hit everyone and everywhere regardless of the status and importance, we can manipulate the media if the case and we do not really care if the plot becomes public or not we just do what we want regardless.
Let's remember what Putin (certainly not a fan of Strauss-Kahn) said after his arrest:
"It is hard for me to evaluate the hidden political motives," the Russian prime minister said in comments posted on the official Kremlin Web site. "But I cannot believe that it looks the way it was initially introduced. It doesn't sit right in my head."

Neither in our heads Mr. Putin!

Travel Photo: Sassi di Matera, Italy

Sassi di Matera

Fukushima radiation and Nebraska evacuation

"A citizens' group in Fukushima Prefecture "Fukushima Network to Protect Children from Radiation" tested the urine samples from 10 children in Fukushima City, age 6 to 16, and announced on June 30 that a small amount of radioactive materials was detected from all samples.
The highest amount of cesium-134 was from an 8-year-old girl, at 1.13 becquerels per liter. The highest amount of cesium-137 was from a 7-year-old boy, at 1.30 becquerels per liter.
The samples were taken in late May, and sent to the French laboratory ACRO (Association pour le Contrôle de la Radioactivité dans l’Ouest) to testing for radiation. ACRO has experience in surveying the radiation exposure in children after the Chernobyl accident. ACRO's president David Boilley said in the press conference, "There is a very high possibility that children in and around Fukushima City have been exposed to internal radiation. Prior to the [Fukushima] accident, these numbers would have been zero."

In the meanwhile in Nebraska, the NRUC said there is nothing to worry about, that is why they imposed a 10 mile evacuation radius around Fort Calhoun. As a reminder Fukushima has a roughly 18 mile evacuation radius zone.

Is the media going to cover those news in any detail aside from a 2 line mention at the end of the newspaper or webpage, I sincerely doubt.

Greece: what is next!

For those who are wondering what is next in the Greek tragedy a clear article from Socgen below explain the possible future scenarios.

Papandreou’s government passes the first austerity hurdle

Against a backdrop of violent demonstrations, George Papandreou’s PASOK government won a first vote on Medium-Term Fiscal Strategy (MTFS) on Wednesday 29. The vote brought a sign of relief but the focus now shifts to the second hurdle: the associated  implementation law which is expected today at midday local time (11 CET). If all goes well, the Eurogroup will then meet on July 3 to finalise a new 3-year programme for Greece involving the private sector. This would effectively remove the need for Greece to access bonds markets before 2015. If the Greek parliament changes significantly the terms of the implementation law (a scenario to which we attach a nonnegligible probability), the risk is that EU/IMF would block the much needed next €12bn tranche. The political vacuum would likely trigger a general election in September and the EU/ECB would have to take aggressive action to stem contagion.

As expected, Papandreou obtained a relatively narrow majority on the MTFS, with 155 votes to 138 (5 abstentions). The MTFS includes €28bn of additional austerity measures for 2011-2012 as well as an accelerated privatisation plan. However, Greece has far from adopted the austerity package. Indeed, the Parliament votes again on Thursday on measures to implement the MTFS.

IMF/EU will only disburse if the implementation law does not lose its inner significance. The Parliaments agreed yesterday on the package as a whole. The risk is now that it modifies substantially some implementation measures, as a result of which the modified MTFS could not meet IMF/EU requirements. The IMF made it clear that the July tranche to Greece can only be disbursed if 1) Greece adopts the austerity package 2) the EU provides concrete assurances that it will continue to provide funding to Greece as stipulated under the EU/IMF adjustment programme. In other words, only after the MTFS is approved can the Troika officially put forward a medium-term funding plan for Greece involving private creditors, through to 2014. And only once Greece is funded for at least the next twelve months will the IMF give its official consent to its share of the quarterly disbursement (€3.3bn over €12bn). A decision from the EU on Greece’s medium-term funding could be reached at the Eurogroup Meeting on Sunday 3 July, rather than on 11 July (as currently scheduled). That would then clear the way for the IMF to authorise its share of the quarterly disbursements too.

No plan B Although not the most likely outcome, significant changes in the MTFS would throw the country in a political vacuum and pave the way for anticipated elections. Indeed, Euro area leaders warned that there was no plan B in case the package was not approved. As the centre-right opposition party New Democracy would be well placed to win the new election and as it is not opposed to austerity per se but wants a ‘different economic policy’, the most likely outcome is that the new Greek government would in the end sign up for an equivalent austerity programme, a process similar to what happened in Ireland and Portugal recently. Greece would then have to rely on short-term funding to avoid a default on coupon payments and bonds redemptions in July and August. One can also envisage that the IMF or EU will give the opposition party the benefit of the doubt during the summer and provide Greece with a bridge loan. But there is no doubt that the turmoil would then be elevated.

Travel Photo: Venice Grand Canal, Italy

Venice Grand Canal

Los Alamos nuclear alert

And as if it was not enough Fukushima's tsunami and Fort Calhoun's flooding a new alert to a nuclear site is taking place in New Mexico.
A raging wildfire is threatening to engulf the Los Alamos National Laboratory.
Los Alamos likely contains more nuclear weapons than any other facility in the world.

As if that weren't bad enough, AP notes:

The anti-nuclear watchdog group Concerned Citizens for Nuclear Safety, however, said the fire appeared to be about 3 1/2 miles from a dumpsite where as many as 30,000 55-gallon drums of plutonium-contaminated waste were stored in fabric tents above ground. The group said the drums were awaiting transport to a low-level radiation dump site in southern New Mexico.

Lab spokesman Steve Sandoval declined to confirm that there were any such drums currently on the property.

Later, Los Alamos confirmed the allegation:

Lab officials at first declined to confirm that such drums were on the property, but in a statement early Tuesday, lab spokeswoman Lisa Rosendorf said such drums are stored in a section of the complex known as Area G. She said the drums contain cleanup from Cold War-era waste that the lab sends away in weekly shipments to the Waste Isolation Pilot Plant.
She said the drums were on a paved area with few trees nearby and would be safe even if a fire reached the storage area. Officials have said it is miles from the flames.

The lab has called in a special team to test plutonium and uranium levels in the air as a "precaution".