Good Morning

As you know, last night while Greece was burning, the parliament passed the harsh austerity measures demanded by the Troika. True to their words, party leaders and Papademos who threatened any lawmaker who did not go along, kicked out an unknown number of members of the PAOSK party were expelled while at least 40 MPs and Ministers resigned. Their resignations, rather then votes seems to indicate this was a fait accompli.


However, as we saw last week in a candid video in which Germany's Finance Minister, Schauble seemed to hint they were making an example of Greece when talking to the Portuguese Finance Minister, reaction from Germany and the Northern countries has been muted if not critical. The Troika keeps changing the rules or moving the line  and this morning seems no different. Remember there is a vote in Germany Wednesday whether to go along with the bailout, so it is not a done deal by a long shot and even that may be pushed back until March!


Comments from Schauble today echoed that reality,


"Greek promises on austerity measures are no longer good enough because so many vows have been broken and the country that has been a "bottomless pit" 


"With a new austerity programme they are going to first have to implement parts of the old programme and save."


Cutting it close...


"Germany’s finance ministry said the country won’t give its final approval for the new aid payments until early March — after there is clarity on how well a debt relief deal with private bond holders would work and its parliament has voted on the new measures."


"National parliaments in Germany, Finland and the Netherlands will have to vote on the second bailout package. Since those countries are traditionally most critical of bailouts, the votes are unlikely to happen before there is clarity on whether the bailout deal will actually make Greece’s debt sustainable again."



"Now we need to wait and see what comes after the legislation," Economy Minister and deputy Prime Minister Philipp Roesler said on German television.

"We have taken one step in the right direction but we are still far from the goal," he said.

Austrian reaction, too, was muted.



"Adopting the austerity package is one thing, implementing it is another, and this is something in which we have to place great store," said Austrian Vice Chancellor and Foreign Minister Michael Spindelegger.

Greece has until Wednesday to commit in a written statement to the changes voted on last night, however the populaces' anger may change the look of the government in April, which may also see Greece back-track on the austerity measures.


If there was one thing the Troika didn't want to hear and fears,


 "Samaras, the current front-runner to replace Lucas Papademos, told parliament last night: "I ask you to vote in favour of the new loan agreement today and to have the ability to negotiate and change the current policy which has been forced on us".


Greece is still far away from the next tranche and it seems like Germany will keep forcing harsher and harsher demands until Greece can no longer go along, which gives Germany an out, such as, "We tried, they wouldn't go along"


Next up, expect news from Germany about an EU Finance task master embedded in the Greek constitution.