Saturday, August 20, 2011

Indian Giver

Among the various European countries lining up to bail out Greece, we have Finland. The Finns promises to "loan" 700 and some change million Euros to Greece. But to make sure they get paid back, the Finns demanded "collateral". The Greeks agreed to deposit 500 million Euros in an escrow account in Finland. The the Greeks default, the Finns keep the 500 million Euros.
Big deal, to get a 700 million loan they put up 500 million, so that in effect the Finns are only loaning 200 million Euros. The rest of the Europeans are waits to see how this plays out.
I saw a European TV pundit on the internet explaining how a movement to "tighten European economic integration" was running into trouble. Under "tight" integration, the Germans would pick up the losses in Greece. The Greeks like the idea, and the Eurocrats love it. The German taxpayers are against it.

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