Greece is offered 30bn euros loan

[muriel_volestrangler]

Source: BBC

Leaders of the 16 eurozone nations have agreed to fund up to 30bn euros (£26bn) in emergency loans for debt-hit Greece, if the country wants the cash.

The price of the loans will be fixed using IMF formulas, and be about 5%.

Luxembourg Prime Minister Jean-Claude Juncker, speaking for eurozone finance ministers, said there were no elements of subsidy in the loan proposal.
...Mr Juncker added that the financing would be "completed and co-financed" by the International Monetary Fund

Read more: http://news.bbc.co.uk/1/hi/business/8614062.stm

[earcandle]

1. Do it. We need you in your rightful place to reinstill ethos, logos, and pathos, the original

womb-tomb must be re-opened. 

[Lucky Luciano]

2. No Elements of subsidy?! LOL

Greek yields were about 7.5% +/- 30 bps along the curve from 1yr on out to 10 yrs. 5% sounds quite like a subsidy to me!

[muriel_volestrangler]

7. Presumably they are saying that rate was artificially high because of market speculation

There is talk of challenging this as a subsidy in the German Counstitutional Court, eg
http://news.scotsman.com/leaders/Editorial-Greece-rescue-rocking-Europe39s.6218953.jp
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/7579177/Eurozone-agrees-30bn-euro-Greek-rescue-package-at-5pc.html

[muriel_volestrangler]

8. And as a possible indication it was speculation: yield on Greek bonds drops over 1% on news

The euro rose, the yield on short-dated Greek bonds fell by over a point to around 5.9 percent and the cost of insuring Greek debt against default narrowed dramatically from Friday's close as markets were impressed by the bigger-than-expected EU rescue plan.
...
The yield on the country's 12-month T-bill plummeted some 268 basis points to 5.28 percent, suggesting the threat of a near-term default had been lifted.

http://economictimes.indiatimes.com/markets/global-markets/Markets-salute-euro-zone-deal-on-Greece-for-now/articleshow/5788151.cms

[Lucky Luciano]

9. Of course the spread narrowed now that they

are not imminently defaulting. That is not a particular sign of excessive speculation. You can take solace however from the fact that the speculators did get thir faces ripped off on this deal.

Turns out that they are claiming it is not subsidized because the interest rate is variable - and thus lower. Now...let;s see if they try to trade an interest rate swap to lock in their rate of interest!

[ZombieHorde]

3. What else could they do? They're not going to kick Greece out of the EU. nt

[G_j]

4. Greece offered 30bn euros loan loan by eurozone

Source: BBC

Finance ministers of the 16 eurozone nations have agreed to provide up to 30bn euros (£26bn) in emergency loans for debt-hit Greece it asks for them.

They offered a three-year financing programme at interest rates of around 5%, based on IMF formulas.

Luxembourg Prime Minister Jean-Claude Juncker said there were no elements of subsidy in the loan offer.
Greek Prime Minister George Papandreou said the decision showed that nobody could "play with" the euro.

"With today's decision, Europe sends a clear message: that nobody can play with our common currency, nobody can play with our common fate," he said, speaking on a visit to Cyprus.

Read more: http://news.bbc.co.uk/2/hi/business/8614062.stm

[willing dwarf]

5. Will it be a lone loan?

;-)

[galileoreloaded]

6. And then asked for 40 billion euro more.....American style. n/t