Greece's Sovereign Debt, season 4: Time to Pack it in?

Greece has a new tax & fiscal law every year. In other words, doing business in Greece is always full of surprises, with changes occurring at least once a year -- EVERY year.

The country's socialist government has finally passed a law proposing very strict rules against tax evasion, including incarceration with summary process (of law presumably). This applies to private individuals for personal income tax & VAT as well as CEOs, for corporate tax & VAT, etc.


This is surely to be lauded; stricter rules against tax evasion are long overdue in this country. Unless more things change however, it seems that it is time for expatriates and would-be investors to start packing their bags, pronto.


There are four reasons why this new law, welcome as it may be in principle, may be put the definitive and proverbial spanner in the works:

1) Trustworthiness
In a country where, by its representatives' admission, the rule of law often depends upon whom you know, the cost of, say, a mistake in ANY tax related issue, made by ANY of the stakeholders, can mean that on Friday night, CEO's kids will have to run to the closest gaol to see their dads until the whole thing "is sorted out". How confident are you that it will be?

What is the price of uncertainty?

2) Corruption:
According to Mr Geoff Papandreou, Greece's Socialist Prime Minister, "there is a lot of that around". And we believe him; and many people having built a house, filed for a license, cashed in a tax return, etc, can actually corroborate this through personal experience...
YET, the Greek government continues to protect the taker, and penalise the giver. Strict rules apply to abbetting Were we to attack corruption, it would make sense to exculpate the giver and penalise the taker, surely?

3) Uncertainty:
Doing business in Greece has just become more complex and more uncertain. We all like the rule of law and the new tax law is no doubt welcome in this respect. But it does not come with a loosening of rigid bureaucracy -- in fact, quite the opposite.

4) Justifying recruitment:
Despite the 7% fall in real GDP, Greece's socialists still bow to the country's restrictive labour regulations: flexible employment is so regulated that temporary, agency work is proscribed. One has to JUSTIFY recruitment in no uncertain terms upon the employment contract -- or the employer and the agency are subject to steep fines. Justifiable temporary or other wise flexible employment seems to be too complex a matter.
No-one but the most courageous employ temps any more in Greece! Most prefer to downsize.

With "real" (i.e. beyond "Greek statistics") unemployment running at 17.1% according to Ministry of Labour sources, one completely fails to understand:

Why???

Why, for goodness sake, do Greeks in power not liberate their employment market? What is there to gain by abetting grey & black labour -- which sidesteps regulations of course -- and aiding unemployment?

Understanding the reasons justifying this apparent paradox is beyond me.

Greece's sovereign debt. Season 4: the final season?

F O R S A L E --- S P E C I A L D E A L S, P L E A S E L O O K I N S I D E!

The Greek government's idea / promise / ad lib / to raise Euro 50 million by selling off real assets, constitutes a partial solution, short-term, to the country's cash flow imbalances. So we found a one-off source of working capital.

But the question still remains: what's the plan, longer term?

How is Greece's sovereign debt to reduce to workable levels? Where is the money to come from -- other than from friends and neighbours?

In 2010 Greece saw its economy reduce by 6.6% in (very) real terms.

The tangible added-value produced in Greece is not very high and 60% of the country's GDP is in the services sector with a ominous-looking 67% of that, accounted for by the Greek Public Sector.

Shipping is one sector where Greeks -- i.e. Greek individual shipowners -- are global leaders. But some companies are switching flags... following Louis Cruises move to Malta, no major cruise ship operator is left under the Greek flag.




It is time to say: time for global brainstorming!

Greece's sovereign debt, Act 4, Episode 1

In which Greek government officials inform the IMF-EU reps of its intent to market Public Assets to raise Euro 50 mill; said reps announce this inter alia in their customary press conference;
following the press conference, Mr Horseshoe, the Greek government spokesman (yes, there is one!), pretends to strongly resent this reference to a garden sale of Public Assets; the IMF-EU Rep Office agrees and normality is restored amidst cheering from Greek television buyers for the free Weekend content.

And all is well.

Meanwhile, a building belonging to the Greek state in Brussels, has been on the market for some time now; it has not attracted any firm interest -- for a very tangible reason: there is no interlocutor i.e. no physical person to speak to about buying the building!
Mr Geoff Papandreou, the US-Swedish prime minister of Greece is constantly changing the boss of the Greek Agency for the Exploitation of National Assets; no-one else is empowered to sell the building...

In case you were interested in it...

Siemens Greece, redux: should Greece have only paid lip service?

The (ill)famed Mr Christoforakos, so famed for allegedly having authorised, or failed to stop, kickbacks from the corporation he headed to Greek government officials, politicians and sundry, was not a king.

But, in his own way, he was important: he was, in the wake of the 2nd millenium, one of Siemens Corporation's Regional Directors. In this respect, he was also that Corporation's youngest Director.

This is no small deal. Mr Christoforakos' region was large indeed and comprised much of the old Soviet Union -- a promising (if troubled) market if there ever was one!

Add to this that the (ill)famed Mr Christoforakos is a Greek-German citizen of Greek origin.

In all cynicism: doesn't all of the above indicate that it's good to have one of our own at the head of one of the world's largest corporations? Or, that's what I have thought if I were in the Greek politicians' shoes, politicians worried more about their country's and countrymen's fate than about their personal finances...

Let's say... "you won government contracts on the strength of generous kickbacks -- how about you make a major investment in Greece? And we'll all extol your Corp's as well as your personal virtues!"

Isn't this delectably politically incorrect!!!

Maybe Greece is lucky after all...

Given Greek authorities' legendary incompetence to deal with any situation, it comes as no surprise that illegal immigrants managed to waltz into Athens' Law School's main building, settle in relative comfort, and stay there, while politicians, TV presenters, and sundry just looked on and talked -- doing nothing.

Greece's institutional shambles hasn't lost its knack to amaze!

Greek television, probably Europe's most idiotic, should be grateful for the royalty-free content -- and it is, showing its gratitude with full-range real-time coverage and tedious speculative discussions.

Greek politicians, reputedly Europe's most nepotist, should be grateful too: these misguided aliens provided the opportunity for declarations, commentary, and no action.

The Greek government should be grateful: while largely indifferent to indigenous matters, the fact did provide an opportunity to make declarations and take the news focus away from the increasingly austere austerity measures.

And, last of all, the aliens themselves should be grateful: what started out as an uncertain adventure on a journey for survival turned into a media party... and, ultimately into a matter blown out of all proportion with excellent trade-offs: shelter in a renovated 1930's villa, adequate food, and tacit recognition of "rights" for which the local taxpayers will pay.

Where does that leave law students??? Barring the Law School;s prestigious President, Prof. T. Fortsakis, no-one else complained, so they must be happy.

The mind boggles at the thought (God forbid) of a Moscow-like incident taking place in Athens! More casualties are likely to ensue from incompetence than of the criminal event...
Please God, be Greek -- or a philhellene!

A happier new year for Greek MPs

Greece's MPs are subject to a special Statute of limitation. It only applies to MPs and, in effect, lasts one year more than a regular tenure. As the assignment procedure is tenuous at best and certainly lengthy, Greek MPs are practically, if not legally, guaranteed complete immunity.
Public opinion being what it is in Greece -- fragmented, emotional, and thereby immaterial to politics and ineffective in any case -- it is a wonder that Greek MPs have not walked off with the loot, lock stock and barrel!

As it is, they seem to be little affected by rumours and TV scandal-mongers and even less interested. Indeed, a game starring TV<-> politics seems to be a more realistic view of things: TV mentions a purported scandal, politics promise to check the allegations for possible tort, committees are organised, reported and analysed by TV, inconclusive conclusions are reached effectively clearing everyone -- and by which time of course... the statute of limitations has done its good deed anyhow.

Greek MP must be one of the best jobs on the Planet! Not only during tenure, but also beyond: all you need is TWO tenures and you are set for life.

Annual remuneration is € 180.000 + car + expenses (70k) + notebooks + utilities. Work is nominal.

Breaking news: MPs in Greece will be glad to learn of a salary increase effective as of JANUARY 2011. In line with austerity measures for the rest of the population!

€

Happy New Year!

We wish you safety, health, friends, a cosy nest, lots of laughs and heavy laughter...

Christmas is 'round the corner...

Sooooooooooooo....


H A P P Y C H R I S T M A S !!!

Too little too late? Or is it?

Well it's certainly a small step for a normal human being, a giant leap for a Greek politician: Greece's communist-socialist government has introduced further, some say adventurous, cost-cutting legislation in one long bill. The bill covers various different topics, ranging from civil servants' pay to working hours and sectoral collective agreements (virtually void).
To whit:
a) It spreads poverty even further amongst the civil servants: i.e. cut their salaries (and their bonuses? Bonuses are often 80-120% of official salary), rather than lower their number.
Result: now, you HAVE to moonlight! And you HAVE (by law) to do it in grey or black!
b) It keeps minimum wages intact, and preserves union power;
c) It raises temporary employment term to 36 months -- but temporary employment is only permitted in case of exceptional, unforeseeable, and transitory needs, so impracticable in Greece anyway.
d) It cuts salaries (such as these cuts may be) across the board. SO how does the cop on the beat compare to the myriad of civil servants scratching or knitting in a warm back office??? Or the soldier with the same office "servant"???

The result is to spread the alarm everywhere and to demotivate everyone involved.

Given Greece's unenviable track records of messing things up, it's amazing anyone outside the country is willing to listen to well-worn excuses any more.

Maybe we should all just take an aspirin and board the first plane out of this mess. Rats leaving the sinking ship??? Right, well I'm not the one to steer it into the iceberg in the first place; in fact many were warning of the iceberg, ever since it alighted on the horizon! Some, even before that.

So why is it that in Greece, it's always the passenger's fault -- never the captain's???

Greece's sovereign debt, Act 3, Scene 2

In which Geoff Papandreou (prime minister of US - Swedish origin) and his government of merry amateurs pretend to resist the authority of evil IMF;
And their cronies all over the village clapped furiously at this display of heroism;
And the media, in unison, stroked the government's fanny and applauded very much;
(Someone forgot to tell the them, the feudal lords have sold out!)

The evil IMF sends over emissaries to subdue the patriotic insubordination;

In a fit of rage, the Grand Vizier himself flies over to Greece and addresses the feudal lords;

The lords respond, they know not what to do, they fear a big to do from their chattel called the civil service;

The ask the Vizier, would He do it instead? And he said, "aye I will be your doctor";

The feudal lords requested for some delay, to get their act together well this time and prepare to leave the country, taking with them their jewels and their bullion;

No, said the evil IMF, not before you implement change...

"Please, no", said the local lords, "this burden is too heavy for us and we will be to blame!" "Let us at least save our vassals and our chattel, and let the privates take the brunt!"

And so it was that private sector unemployment reached its all time high before the next one next week and the public sector remained complete...

Don't forget to tune in for our next episode!

On the 6th day of Xmas.... the Greeks' "father authority syndrome"

...school's OUT again.

No, not really, but some Athenians are demonstrating all over Athens in memoriam of two years since the untimely death of a school boy from (unintended, we would like to believe) police fire.

Some time later, in similar fashion, a policeman died and two more were injured during an attack on their precinct.
No Athenian seems to find that fact particularly moving. No demonstration.

Speculating on this I come to an obvious conclusion: Greeks need something or someone to demonstrate against. I think Greeks feel oppressed by their everyday existence and demonstrating is their way of getting some temporary respite from the unbearable burden of being Greek...
So, in Greece, we revel in actions of defiance and love to demonstrate against oppression. Accordingly, when there is no visible oppression (because political authoritarianism there is in Greece) and there is no visible cause, people feel obligated to fabricate a cause. And there will always be an obliging ruffian somewhere to provide an excuse for a cause! Hence the demonstration today.

On the other hand, Greeks do not seem to have developed a national social feeling: the idea of one standard (one law, one yoke, etc) for all does not seem to enjoy much popularity in the country.
In this light, perhaps the best would be many official causes: one for each Greek interest group. There are many of those -- literally, one for each citizen. They are sanctioned by Greek TV, probably Europe's most propagandist, and weak and change-averse governments.

The most vociferous of these interest groups are typically the least populated: left wingers and 60s communists. There used to be the 70s socialists (this guy for example) but "social" in Greece is now just a byline for a political party. Indeed, most if not all of the erstwhile "socialists" have become stinking rich and can't be bothered with demonstrating. They no longer feel "oppressed". This man leads the bunch.

So wealth is an antidote to demonstrating. Hence we conclude that those demonstrating are not, of themselves, wealthy.

But what is the underlying reason for which Greeks will demonstrate at any occasion that offers itself?

One reason would be that Greeks are romantics, ready to support the cause of anyone who, in their eyes, is less fortunate than themselves. For the more fortunate, they would still demonstrated -- but against rather than for.
I believe there is a common denominator to all this activism, and the Greek oppression mania: I am oppressed therefore I am.

I think Greeks are heavily into Bogey-Man resistance: it's a psychological state whereby adults, primarily male, never manage to accept, endorse and subsequently get over the paternal authority. Thereby they act like thwarted adolescents throughout their adult life unto their middle age: most demonstrations, seen through this point of view become palatable.
In getting to the streets, most Greeks are demonstrating against the paternal authority they never got over. I.e. they are shouting against their fathers. It is called congenial father syndrome (CFS). It is a congenial matter, perhaps there is a drug for it?

A second hellene - neurosis is the random feeling of injustice; another name for this pathology is greco-victimism syndrome (GVS).
The short description follows:
Whatever happens, wherever, the Greek is a victim of an injustice. Swindling. This is called neohellenic - swindle syndrome: NSS

Put another way, "Just deserves" never are!

It's the first day of Xmas! May God Bless...

...Greece.
Because if He does not, who will??? Anyone???
The Greek government knows not its right hand from its left.
Private spending has reached an all time low -- until the next all time low, that is.
Growth is not around the corner, probably not around any corner as things stand.

If one is to read Paul Krugman writing in the NYT about Spain, "a catastrophic bank crisis (...) seems plausible for Greece and increasingly possible in Ireland"

Oh my.
Can anyone help?
Greek government officials and related bodies need not apply.