The history of Greece is rich and deep, its pockets are not. The country, caught in a tangle of political polemic is running out of money. The question is a matter of when – and the answer is complicated.
The treasury sums point to cash reserves running dry on February 24. But that deadline could be extended using reserves of government entities to cover short-term needs to the end of March.
These are the bills until then. An IMF repayment of 1.5 billion euros, treasury bills to the tune of 4.4 billion and just to keep going, the country is looking at around 4.3 billion of extra funding. The bottom line comes in at a hefty 10.2 billion euros.
Government debt is only one part of the equation, Greek banks are hemorrhaging euros as well. They received a boost with the European Central Bank increasing its emergency fund by 3.3 billion to around 68.3 billion. That reflects the amount of capital fleeing the banks.
“Greek banks are on their last legs. That is absolutely for sure, we do know that. So they are only being kept alive by the ECB. Also you have to look at the treasury coffers in Greece and they are also very low. People haven’t been paying tax in the lead up to the election,” opined Kathleen Brooks, Forex.com analyst.
Athens stock market closed up 1.06 percent falling from earlier highs after the news that Germany rejected the Greek request for a six-month extension to its eurozone loan programme.
Stocks were trimmed across Europe on news of the German action.