Mike Shedlock

Inquiring minds scoff at the preposterous Financial Times headline a ‘Glimmer of hope’ for Greek coalition

The "Glimmer of Hope" that  Financial Times writer Kerin Hope speaks of is the possibility of a coalition that last until 2014 before new elections.

I strongly disagree.  I believe another coalition whose sole purpose is to keep Greece in the eurozone will result in more years of useless torture.

Here are a few snips from the Financial Times.

Greek conservative leader Antonis Samaras said on Friday there were still hopes a government could be formed after Sunday’s inconclusive election to avoid a repeat poll.

“We are fighting to form a government and there are still hopes this can done,” Mr Samaras told his parliamentary group, adding that he welcomed the proposal of a small, moderate leftist party for a national unity government.

Earlier, he met Socialist leader Evangelos Venizelos, who has been given a three-day mandate to try to form a government.

Mr Venizelos on Thursday launched a last-ditch attempt to form a coalition government and avert a fresh general election next month that could push the country closer to exiting the euro.

He said he was not optimistic, but “discerned a glimmer of hope” in discussions with Fotis Kouvelis, leader of the small leftwing party Democratic Left, who appeared to have softened his previous opposition to co-operating with the socialists and conservatives in government.

Such a three-way coalition could “just possibly” survive until the European parliament elections in mid-2014, “when the country should be on the road to recovery”, said one Pasok lawmaker, referring to forecasts by the EU and International Monetary Fund for modest growth that year.

Venizelos is a Liar

For starters Venizelos is a liar. He said he had no interest in forming a government pieced together with barely a majority.

So what changed his mind, and what may change the mind of  Fotis Kouvelis?

The answer is easy to explain in form of post-election polls that show soaring support for the Syriza party led by Alexis Tsipras.

Before looking at recent polls, note that Syriza's demands are enough to spread fear into the hearts of every pro-euro clown.

Tsipras' Five Point Proposal

Please consider Tsipras lays out five points of coalition talks

  1. The immediate cancellation of all impending measures that will impoverish Greeks further, such as cuts to pensions and salaries.
  2. The immediate cancellation of all impending measures that undermine fundamental workers' rights, such as the abolition of collective labor agreements.
  3. The immediate abolition of a law granting MPs immunity from prosecution, reform of the electoral law and a general overhaul of the political system.
  4. An investigation into Greek banks, and the immediate publication of the audit performed on the Greek banking sector by BlackRock.
  5. The setting up of an international auditing committee to investigate the causes of Greece's public deficit, with a moratorium on all debt servicing until the findings of the audit are published.

However, it's not the proposals that are scary to the Troika and eurocrats, but rather Syriza's poll results two days after the election as disclosed in Athens News show that Tsipras has a chance in carrying those proposal out.

  • Syriza - 27.7 (128 seats)
  • New Democracy - 20.3 (57 seats)
  • Pasok - 12.6 (36 seats)
  • Independent Greeks - 10.2 (29 seats)
  • KKE 7 (20 seats)
  • Golden Dawn 5.7 (16 seats)
  • Democratic Left 4.9 (14 seats)

Svriza's totals rise every day. By the time elections are held, any coalition might put them in the majority. It's conceivable Syriza would not even need a coalition.

This explains the all-out push by eurocrats and Troika-sponsored clowns to stop another election.

Thus, the "Glimmer of Hope" that  Financial Times writer Kerin Hope speaks of is more like a "Glimmer of Despair".

In general, I have no use for socialists. However, if they serve to bring about the exit of Greece from the eurozone they will have done Greece and Europe a huge favor. The sooner the breakup the better. 


Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Mike Shedlock

Mike Shedlock is a registered investment advisor representative for Sitka Pacific Capital Management.