Financial Crisis and Banking Crisis in Japan: – | SpringerLink
On paper private creditors renounced Indeed private creditors, the Troika and the Greek government had set up a complex mechanism: private creditors would exchange their Greek securities against others at a lower nominal value. The holder of the bond, the creditor, is entitled to interest and reimbursement of the principal. If the company is listed, the holder can also sell the bond on a stock-exchange. Moreover they received compensations for tens of billions of euros. At the end of the day private creditors had made a good bargain and were replaced by international public creditors ECB, Eurozone member states, IMF that were going to exert an unrelenting pressure on the Greek authorities to implement ever worse antisocial measures.
The major losers of the restructuring were public social-security entities and small shareholders.
Most of those losses were borne by public pension funds Pension Fund Pension Funds Pension funds: investment funds that manage capitalized retirement schemes, they are funded by the employees of one or several companies paying-into the scheme which, often, is also partially funded by the employers.
The objective is to pay the pensions of the employees that take part in the scheme. They manage very big amounts of money that are usually invested on the stock markets or financial markets. The other group that registered significant losses consisted of small holders. The losers in the restructuring were public social-security entities and small holders. The number of households who lost most of their savings overnight is estimated at over fifteen thousand. Such a situation can be explained from the fact that for years state securities were sold as absolutely safe.
In other words, the assets provide information about how the funds collected by the company have been used; and the liabilities, about the origins of those funds. To those 13 billion we have to add pending interests. The schedule of repayment to the ECB runs from to Of course if the ECB resumes its buying of Greek securities from private banks, new repayments will have to be added. We must also remember that the ECB remits to the Eurozone member states part of the profits robbed from the Greek population and that this money feeds the budgets of countries such as Germany, France and Belgium.
In January the Greek people voted Syriza into government on its promise to put an end to the MoA.
While the Tsipras government was merely a week old, the ECB took an utterly ruthless measure to put maximum pressure on Syriza. Faced with such aggression the Tsipras government should have responded with bold daring. The demand included in the Thessaloniki Programme see excerpts below should have been put forward: the cancellation of most of the debt, explaining that it was illegitimate, odious, illegal and unsustainable. Of course, European leaders could not accept this request but the Greek government could have developed an international campaign of explanation in order to gain broad public support.
It could have initiated an audit process and declared a moratorium until the audit was completed. It was essential not to get caught in the wheel of repayment. It was necessary to use the principle of international law that allows a state to declare a moratorium on payments in view of the state of necessity in which it finds itself. We do not anticipate on the results of the audit, but it is only normal for payments to be frozen during an audit. Therefore, we suspend repayments during the audit, except for short-term debt. We were elected to replace the Memorandum with a new reconstruction plan.
Structural Adjustments policies were enforced in the early to qualify countries for new loans or for debt rescheduling by the IMF and the World Bank. The requested kind of adjustment aims at ensuring that the country can again service its external debt. These SAPs have not only substantially contributed to higher and higher levels of indebtedness in the affected countries ; they have simultaneously led to higher prices because of a high VAT rate and of the free market prices and to a dramatic fall in the income of local populations as a consequence of rising unemployment and of the dismantling of public services, among other factors.
Payment suspension had to be urgently decreed, for instance on 12 February Action also had to be taken regarding banks. That means that it will make decisions about the way they are run. It was therefore necessary for the Parliament, in accordance with what Syriza had pledged, to transform the so-called preferential shares held by the public authorities which do not entail voting rights into ordinary shares giving the right to vote.
Then, in a perfectly normal and legal way, the state could have exercised its responsibilities and provided a solution to the banking crisis. Finally, two important steps still had to be taken. Secondly, it should have set up a parallel payment system. What was needed was to issue a call to international solidarity before public opinion, social movements, political parties and to encourage, as a government or as Syriza, the creation of solidarity committees in as many countries as possible while negotiating with creditors so as to develop a wide global movement of solidarity.
Let us recall that from the end of February to the end of June , Yanis Varoufakis and Alexis Tsipras made repeated statements aimed at persuading public opinion that an agreement was in sight and that things were going to mend. If after each major negotiation meeting they had on the contrary explained exactly what was at stake through press releases, oral declarations to the media, speeches on public squares, in front of the seats of European institutions in Brussels and elsewhere, if in other words they had shed light on what was being plotted in the shadows, it would have resulted in gatherings of tens of thousands of demonstrators; social networks would have relayed this alternative discourse to hundreds of thousands or millions of recipients.
Tsipras and his government did not choose this path of resistance. They vainly attempted to reach an agreement with European leaders. Faced with the harsher demands of the European leaders, who refused that the government meet its promises to the Greek people, Tsipras called a referendum that was held on 5 July A couple of days later, Alexis Tsipras betrayed the popular mandate and capitulated in Brussels.
Yet an alternative to capitulation was possible and necessary, as we have repeatedly shown. Instead of showing the courage to implement alternatives, the Tsipras government dragged their country into the gruelling experience of a third Memorandum that ended on 20 August During the three years covered by the third Memorandum, attacks against the economic, social, cultural, civil and political rights of the Greek people multiplied as a consequence of decisions made by the Tsipras government, which consistently yielded to the demands of European leaders, Greek and foreign big capital and the IMF.
There is no cause for celebration as the third MoA comes to an end because Greece has not recovered its freedom to act.
Financial Crisis and Bank Management in Japan (1997 to 2016)
It is constrained by a number of binding agreements and the burden of the debt that is exacted will remain unbearable for a long time to come. We publish here extracts from the programme on the basis of which Syriza was elected by the Greek people in January for its text clearly shows the commitments made by Alexis Tsipras. We have added some notes to highlight what was actually achieved. Reduced public transportation cost. Soon they will have to face a new pandemic: banks will seize their private properties since it is difficult for them to repay the loans they contracted before the crisis, before their jobs were gone, before the assault on their income and the shutdown of their businesses.
With these steps, not only do we hope to offer respite to the suffering people who form the backbone of the economy, but also boost the real economy by freeing it from the tentacles of the taxes and surcharges that are totally unproductive because not collectible.
When the debts and the down-payments are regularized, necessary funds for tax relief and an equitable burden-sharing will be our immediate rewards. Moreover, as part of the measures to revive the economy we are announcing an immediate repeal of the new property tax. The Vulture Funds then pursue the issuing country for the full amount of the debt they have purchased, not hesitating to seek decisions before, usually, British or US courts where the law is favourable to creditors.
At the same time, we are taking steps to ensure liquidity in the real economy. Setting up a development bank and special-purpose banks. The new model of the banking system will include, in addition to the phased recapitalization of banks, specific cooperative banks and a public development bank. Dear friends, The third pillar of the National Recovery Plan presented to you today has been tailored to our great national goal: to provide jobs to all, to restore hope and prospects to our young people who have been emigrating in hordes, but it is their strength that we need to reconstruct our country.
Thus, they will benefit not only from low-interest loans, but also from the bonds that the proposed development bank would issue for financing interventions. We commit ourselves. The long period of an appalling and perplexing inaction from the current government will come to end with the launch of a special service made up of experts and equipped with suitable technological support.
Commerzbank is the second largest German bank after Deutsche Bank. Banking crisis resolution policy - different country experiences. Central Bank of Norway. ECB: Statistics. Financial statements of the ECB for European Financial Stability Facility Act Greek bank bailout fund CEO asked to resign -government official. Emphasis added by the author. This measure lost its steam in August , thanks to a specific article of the third Memorandum.
As of end it has so far been allocated to , households , comprising around , people. It is expected that , people living in extreme poverty in Greece will benefit from it in Please note that This is also applicable to asylum seekers and vulnerable people. However the health system has been steadily deteriorating since the first Memorandum, leading to severe medicine shortages, long queues and overloading of services in the hospitals, closures of entire provincial facilities, lack of staff and funds etc. New supplementary pensions have not been granted since January , while this law will phase out the EKAS benefits applicable to the lowest pensions by E, to help debt-ridden people.
Since January , the Independent Authority for Public Revenue which replaced the tax department of the Ministry of Finance conducted raids for property seizures without sparing primary residences. Among them 2. They are unable to pay even this amount. Not only was this promise broken but the law that protected primary residences from being auctioned through expensive legal means will also become invalid from January 1, Even worse, foreclosed properties are now going to be auctioned online to counter vigorous citizen opposition, and dissenters can be punished by a prison term of three to six months.
As for the Tsipras government, it has not taken any action yet so that the Greek state can exercise its rights over the recapitalized banks. Moreover, the Hellenic Financial Stability Fund has been left in the hands of the close associates of the private bankers and the European leaders. Yanis Varoufakis, Adults in the Room , Chapter Labour rights went further downhill in January with the adoption of a law that limits the right to strike.
Finally, the law keeping retail stores open on Sundays has not been withdrawn, despite repeated protests from the majority of merchants and their employees.