Yet another statistic of the Greek crisis that highlights the complete absurdity of the Greek bailout “plan”.
I have detailed the figures which show that the methods being adopted by the Greek government are self-destructive.
When you factor in this news story of private banks pulling credit out of the Greek economy the situation only looks more futile.
Not only is the Greek economy on course to have negative GDP by 2020 using the Eurogroup’s own figures the fact that on top of the trade deficit, the cuts in government spending inside the country and the debt repayments you also have the amount of the credit in the country shrinking by 500 million Euros a month. It is impossible for anyone with a remote handle on the figures to see this ending with anything but total disaster.
Perhaps growth could return if the economy was stabilizing but the fact is it is not. The government is continuing to pass more and more tax increases before the consequences of previous rounds of tax increases have been understood or realised.
At the time of writing roughly 3 billion Euro’s a month is being pulled out of the Greek economy. With bail outs tranches coming to what appears to be 18 billion Euros a year, at the current rate of shrinkage the Greek economy is on course to be 60% smaller by 2020. More or less exactly what the Greek central bank governor is threatening will happen if Greek do not agree with these measures.