Greek banks run out of cash!?

ATM Greece

There is some rumors that some of Greek banks have run out of cash? Sure, euro droped quickly back and there is a question about technical levels now if that rumour is true. Gold jump quickly for $8 to 1217. Greek saga countinues to move the market!

I don’t know is that true or not, but I don’t like to trade/analyse until rumors are not clarified. So, this is it from me for this trading week! 😉

Edit: 20 minutes latter, Greek banks officially denied rumors!

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2 comments

  • christopherglendinningmiller

    I have a fear that if Willie Sutton were to be alive, he would have a problem. He is famous for his reply when asked why he robbed banks ‘I rob banks because that’s where the money is’. It would appear not so in Greece any more – they have run out of money.

    The problems of Greece and with Greece show no signs of being resolved anytime soon. One assumes that there is a limit to the amount of money the ECB is prepared to commit to Greece. Sadly the prospects of the ECB being repaid any of the money owed by Greece diminish almost daily. There will have to be a point at which the ECB will stop throwing good money after bad. Basically Greece has to achieve a more competitive economy and pay taxes. From what has been suggested so far, I have no confidence that either can or will be achieved.

    On this basis Greece cannot remain part of the Eurozone. It is a bit like entering a donkey into the Grand National or a Tribant into a Formulae One championship. In simple terms neither stands a chance. The Eurozone consists of some of the most developed and sophisticated economies and Greece simple is not there.

    In reality the only way forward is for Greece to revert to the Drachma in an orderly manner. It is likely that the New Drachma will devalue very quickly. The problem will be exacerbated by those hedging against devaluation. This has been seen in the fall of oil prices. Suppliers are hedging against lower oil prices and that in itself has driven prices lower.

    The good thing about a devalued Drachma is that Greece will become more competitive. However with this enhanced competitiveness will come lower living standards unless there is improved efficiency. There has been little or no talk of ways in which Greek efficiency can be improved. For example in the UK I can go online and form a limited company in about fifteen minutes and the certificate of incorporation will be emailed to me the following working day. In Greece it can take weeks with hours of work getting all the documents in order.

    The problem with devaluation is that it is going to be the man on the Athens’s street that gets hurt the most. Any savings that they may have had will be devoured by inflation. For the wealthy, their money will be safely abroad in a hard stable currency or assets.

    The hope would be that Greece just might emerge a more competitive economy and able to take on the position as a Eurozone member. Much will have to change and maybe Alexis Tsipras is the only man with the popular following and courage to take Greece through what almost certainly will be turbulent times.

    Like

  • I think rumor wasn’t accidential, let’s see return of the euro now.

    Liked by 1 person

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