Δευτέρα, 7 Σεπτεμβρίου 2015

"A Debt Relief is Inevitable"

Do you consider that the current Greek bailout deal is going to improve economic and social conditions in the country?

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Marc Chesney 
Professor of Finance
University of Zurich

No, on the contrary. The situation in Greece is catastrophic. Implementation of the policy imposed by the "Troika" has generated unemployment, despair and misery. The wave of privatization generates an absurd situation in which the country's key assets are wasted. Most of the so-called European financial help to Greece goes back to its creditors or is unsuccessfully used for the recapitalization of Greek banks. The debt level is not sustainable. 


Greece is currently under the supervision and tutelage of the European Commission, the International Monetary Fund and of the European Central Bank. Democracy is flouted - and moreover, not only in this country. 

Is there any alternative option for Greece inside Eurozone, other than adopting a third bailout package?

Debt relief is inevitable as it was the case for Germany after World War II. Therefore, a debt audit, as was carried out in Ecuador for example, is essential. Only legitimate debt should be reimbursed. A debt is illegitimate when it goes against the interests of the population with full knowledge of the creditors. For example, credit obtained for the 2004 Olympic Games should be carefully scrutinized.

Greek banks have received billions of euro for recapitalization since 2010, but only a tiny part of it has been driven to investment and growth projects. Why is that? 

Most of these banks are zombie banks. Their recapitalization is hopeless. It is like trying to fill bottomless barrels. It is a solution neither in Greece nor in any other countries. Too big to fail institutions gamble at the expense of society and the economy. Losses associated with their bets are financed by the taxpayer, the client and the stockholder. These banks are more and more disconnected from the needs of the economy and of society. 
*Interview conducted by Dimitris Rapidis, Director of Bridiging Europe
About Marc Chesney

Marc Chesney is currently Professor of Finance at the University of Zurich and is also a member of Finance Watch.

He was previously Professor and Associate Dean at HEC Paris from 1993 to 2000. He develops a critical analysis of the financial sector and is the author of the book entitled: “From the Great War to a permanent crisis”, recently published in French and German. This book will soon be published in Greek by Livanis.

sourche: http://www.bridgingeurope.net/interview-with-marc-chesney-professor-of-finance-at-the-university-of-zurich.html

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