February 25, 2011

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How Greece was handed over to the banking cartel

In some of the earlier posts on this blog, I had promised to explain at some point how the government purposely placed our nation at the hands of the global banking cartel. After surfing the web for several weeks and continually gathering information on this subject, I finally can release the story, with all its facts, timeframe and conclusions.

But before I do that, I need to note how sorry I feel for all of those who actually believed this crap. Since the Panhellenic Socialist Movement (PASOK) government of George Papandreou took office Greek people have systematically been slandered by the international media. Of course our prime minister is highly responsible for this, since he has systematically slammed his own people and nation to many, many interviews that he has issued to foreign press agencies. 

For months on end now, we have been described to be lazy, good-for-nothing bums, parasites and just living at the expense of the other peoples of the European Union. The German media in fact (especially the highly influential rags Bild and Focus magazines) collectively dubbed Greeks “thieves” and spewed endless hatred in their columns towards us. 

On February 22, Focus featured the statue giving the finger with the headline “The traitor within the European family” (BetrĂ¼ger in der Euro-Familie in German) underneath, which infuriated the Greek and  German governments.  

The cover stirred a lot of controversy in Germany but Focus didn’t apologize for the insult by representing Greece as an “ill-mannered child”. 

And what is more Focus came out with  yet another issue with the same exact  statue on the cover but this time, no middle finger was raised, instead it showed the palm of the statue facing up instead, implying that we are beggars, with the caption saying.. “Griechenland – und unser Geld” (Greece and our money).  

Clever indeed…. But no amount of Photoshop can wipe away this country’s sins… have they forgotten that they have a blood line to Hitler? 

Anyhow… back to our story. From all the evidence gathered, there is no doubt that Greece was sold out, and literally handed over to foreign hands, via the “Memorandum” it signed with the International Monetary Fund (IMF for short), the World Bank and the various corporations (banks and “development” companies) represented by these two organisations. I need not remind you who isbehind the IMF, and/or the World Bank… they are controlled by the world’s richest countries, particularly the US, which is the main shareholder in both institutions. 

In order for the banking cartel or new world order to come in… the ground had to be prepared for it here in Greece.  Remember the «incidental" speech by Henry Kissinger that was accidentally featured in the magazine Economicos Tachidromos dated August 14, 1997? During which he said the following: "The Greek people are anarchic and difficult to tame. For this reason we must strike deep into their cultural roots: Perhaps then we can force them to conform. I mean, of course, to strike at their language, their religion, their cultural and historical reserves, so that we can neutralize their ability to develop, to distinguish themselves, or to prevail; thereby removing them as an obstacle to our strategically vital plans in the Balkans, the Mediterranean, and the Middle East.

a.  ECONOMIC WARFARE to defend the dollar by attacking the euro through Greece! The video presented right above this comment confirms this notion since it is clearly states that a “secret dinner” was held by hedge fund varmints that had their sights on our bond market and it was planned that a speculative attack would be made on Greek bonds and the euro using leverage rates of 20 to 1.

b. And oh yeah… full control of our natural reserves…. (Check related stories on blog) Adn this because all these varmints knew and know... that we will be so poor in a couple of years after having swelled up the debt so much that we won’t have the sufficient funds to ever pay back the money they loaned us.

Getting back to our subject, so how did they prepare the ground for this… and how did they convince Greek citizens, who indeed are difficult to control that all of this was real? Well… get the central media on it and presto… after months and months of propaganda… people bought into the story without a problem.
I mean don't get me wrong, I am a realist... and I know very well that Greece does have a debt problem, but our debt was nothing compared to the debt of other countries such as the US, Italy and what not… 

Also, I do have to admit that our economic meltdown began way before Papandreou took office. In the year 2000 when former prime minister and head of the PASOK party Costas Simitis was in government he made a deal with the devil with Goldman Sachs and hid our national debt… in other words Goldman Sachs helped Greece to develop a set of double set of books so that we can easily enter the euro zone.  Simitis, is guilty as he, as Max Keiser states in the video above.

Simitis’ move more or less trapped and/or obligated the following government of Costas Karamanlis to follow suit. So his Minister of Economy, Mr. Alogoskoufis put Greece on a fiscal watch by the European Union and this more or less delivered a “purified” country to the new government of George Papandreou. Who when he rose to power, simply and easily surrendered the country to the International Monetary Fund. 

But before he did this George Papandreou and his cabinet, starting with Minister of Economy George Papaconstantinou, began slamming Greece as an unreliable and corrupt country. 

This interview was made months before he came into office.

I mean how can a government official of any country bash his own country and term it unreliable and/or corrupt? I would have comprehended an accidental statement… but these two men systematically bashed their own nation abroad for several months and then had the audacity to deny it on a national level in fear of the reactions it would have on the Greek people. 

Of course they had a lot of help from the Greek media… since the majority of the Greek media is in full support of the government. We will tackle the reasons why the media supported and continues to support the government on another post, just keep in mind that if it wasn’t for several smaller channels such as KONTRA TV  and many, many blogs (check list of blogs on side panel), that pumped out a tonne of information then everyone would of bought in on it.

What kind of Hellenes are these men anyway? Are they Hellenes?

Another thing they did was continually say that Greece did not have a financial problem,. Did he purposely forget that that was the main focus of the 2009 elections that elevated him to office? I think not. Tougher economic measures in result to the 2008 global economic crises is one thing... but selling out your country on purpose (as the evidence shows above) is another. 

Another thing he noted before the elections, was that we would never result to the IMF... as the video above shows... but of course evidence that recently saw the light showed that he was in talks with the IMF months before he announced that we were going to be bailed out from them.

Moreover, two weeks Papandreou admitted that he formally called for the intervention of the International Monetary Fund in Greece at the beginning of December 2009, or two months after he took over the governance of the country. Remember... that until now he was publicly categorically rejecting such a possibility.  And the only reason he admitted that he did this is because he was obligated to do so because the head of the IMF Dominique Strauss-Kahn, in a documentary to be broadcast by French television channel Canal +  in March of this year, announced it.

In the context of the documentary, Strauss-Kahn revealed this information stressing at the same time the confidence Papandreou showed to him personally..According to Strauss-Kahn, when the Greek prime minister exposed the idea to appeal for IMF aid 14 motnhs ago, he answered that European leaders would not accept any unilateral intervention by the IMF at any Euro zone member country.

According to the documentary the assessment of the French politician was reaffirmed at the EU leaders  summit on December 11, 2009, when Mr. Papandreou raised the issue to his counterparts to receive a vehement denial.

Instead they requested assurances that Greece will not announce ”halt of payments."

“However Papandreou’s public statements on the sidelines of the summit were at a completely different wave length. He had stated in Brussels , an appeal to IMF was out of question”.

LIES LIES and more LIES. He is quite a Pinocchio isn't he?

So, George Papandreou and George Papaconstantinou methodically created a completely hostile climate for Greece on the international financial markets. The video above shows how how now, with the realization that everything and everyone is turning against him.. Papandreou is leaking to the press that he is looking for other areas of funding other than the IMF.  And I ask.... now he realized what damage he did?

What was the outcome? 

Greek bond spreads went through the roof. And as if this was not enough, the Bank of Greece provided special opportunities for “naked short selling” of Greek government bonds, resulting in an overnight skyrocketing of the spreads from 150 to 450 basis points, as revealed by the newspaper “Eleftheros Typos. (Free Press)”

But how did all this happen? 

What are “spreads”? 

What is “short selling”?  

What is “naked short selling”?  

Surfing the web I found this post: techiechan It is explained very well here, but only available in the Greek language, so I decided to republish it in English:

Repo - (check reference at bottom): John has a 10-year Greek government bond purchased in 2008 and plans to use it as an education fund for his children. Mr Know-it-all agrees with John to borrow his bond for a month and promises to return the bond, and compensate John for the trouble with a small pre-arranged amount of money of let’s say 20 Euros. John agrees and so the bond is in the hands of Know-it-all who, for a month, can do whatever he wants with it, as long as he returns it at the end of the month, along with the pre-arranged amount. This is what we term a repo.

Spread (check reference at bottom): Bonds, much like the term deposits, have an interest rate, determined at the time of issue. When we talk about a 5-year bond of 1000 euro with a 5% interest, it means that the one who will buy it will make 50 Euros per year, for the next 5 years. The spread is the difference of the interest rates paid by a country in relation to the rate paid by another country which we consider as a basis. So, if Germany currently pays 3% for 5-year bond and Greece pays 5%, then the spread is 2% or 200 basis points.

TL;DR - (check reference at bottom): The price of a(n) (old) bond falls as the current interest rate rises in the same class of bonds. In short, when spreads of the 5-year bonds go up, everyone who owns older bonds of the same class (ie 5 years), are the first to lose. The state is indirectly harmed in two ways: (a) By its reduced reliability (those who buy its bonds lose) and (b) When new bonds are issued, these bonds will have a higher rate.

Short Selling - (check reference at bottom): Mr Know-it-all, who has John’s borrowed bond, sells it in the market for 1000 Euros. He waits a few days, and the price of the bond falls. Then he buys a similar bond (10 year bond, issued in 2008) for just 900 Euros. So, Mr Know-it-all sold a borrowed bond for 1000 Euros , he bought the same bond a few days later for 900 Euros, and now has a bond which is the same as the bond  he borrowed, plus 100 Euros (1000-900 = 100). At the end of month he returns the bond to John, and gives him the agreed 20 Euros of the 100 that he won and keeps the 80 Euros for himself.

From the above process, we understand that John, who still has the bond, gets the shaft and Mr Know-it-all, who has profited by the bond’s price fall, makes a pretty penny.

Because Mr Know-it-all is a greedy bastard and wants to make more than the 100 Euros the above process helped him make, he does this next: While he has only borrowed from John one 10-year bond worth 1000 Euros, he sells in the market 10 bonds worth 1000 Euros each. In fact, 9 of these bonds sold there do not exist; they are bare (naked). This is a very dangerous practice of short selling, as there is no limit as to how much bare bonds can one sell. In the simple short selling, the limit is the bonds available in repo loans.

That way, one can create a virtual oversupply of bonds in the market, resulting in the bond prices sinking faster than the MS Estonia (check bottom for reference).  On practical terms, the devaluation of the bonds becomes a self-fulfilling prophecy and the entire person who made the naked selling has to do after this, is to buy these 10 bonds back at significantly lower prices, by taking advantage of the panic he created. (Check bottom for reference) 
The Bank of Greece acknowledged that the above practice was occurring and/or that it was being tolerated because it was discovered that an existing loophole was present, 

I will immediately elaborate: When someone sells a bond in the market (Electronic Secondary Securities Market owned by the Bank of Greece), he is required to deliver it to the negotiators within 3 days so the bond reaches the hands of the buyer. This is known as T +3. So there is the possibility to sell a bond you don’t currently have. So you owe the negotiator a bond and you have to deliver it in 3 days. If you re-buy it after two days from the same negotiator, then the negotiator connives and practically cancels your debt (because you sold one bond, bought one, the sum in bonds is zero).

This is an act of naked short selling as at the time you sold the bond, you were not required to actually possess it (or to have borrowed it, as described in the repo).

Since 3 days is usually too short a timeframe for the bond prices to change, no one normally does naked short selling this way. For any naked short seller to profit from a situation like this, there has to be a ridiculously steep price drop in only 3 days.

The backdoor of the Bank of Greece

This is the normal procedure. But in this process there was a backdoor that the Band of Greece had deliberately left open. And this loophole was: failed orders. So, when someone sells a bond, he has to deliver it within 3 days. If he doesn’t, then the transaction is ‘failed’. Failure doesn’t mean that the transaction is void, because the sale has been made, and there is a buyer waiting for his bond. If the seller delays the process, it can go on for even 10 days. But if he carries it too far, then the negotiator has to buy a bond himself, give it to the buyer and send the bill to the seller. But this is unlikely to happen, because the seller knows what he can get away with. In this manner, a Greek bond seller could keep his position open for 10 days, without possessing the bond he had sold. He could practically have a naked short order, with no one holding him accountable. In October 2009, the Bank of Greece took a decision to further simplify this process by “facilitating” anyone who wanted to play this loophole. 

It was explained above how dangerous and practically illegal naked short orders are. Combined with the backdoor opened by the Bank of Greece and the constant flow of “made-to-order” articles on the Greek crisis, it is clear that what we had here was a recipe that allowed anyone to run naked short orders for at least 10 consecutive days.

This went on for quite a while, until April 8, when things got out of control. The committee that controls the Electronic Secondary Securities Market decided to close the loophole of failed orders with the following way: For every ‘sell’ order, the seller must provide a repo (a borrowed bond of one day) until he could provide an actual bond.


First Conclusion: The Bank of Greece opened a dangerous backdoor in the bond market. Whether done in October when Papandreou came to office or earlier, this loophole was able to create, in a crisis environment, a situation of undervaluing speculation on the Greek bonds market. Therefore, Mr. Provopoulos, head off the Bank of Greece, is absolutely responsible for this loophole. If he did not understand the consequences of this loophole, he is incompetent but if he did then he is an accomplice to this atrocious crime and should be prosecuted.

Between you and I, it is highly doubtful that he didn’t understand what was going on…. he very well did and that is a cause for scandal!

Second Conclusion: It is easy to see whether the further facilitation in October 2009 had a real impact in undervaluing speculation. We only need to examine, day by day, the transactions and how the volume of bonds developed since the beginning of 2009 until today. At the same time we should also consider the actions and volumes of the failed orders used by everyone who wanted to engage in naked short selling. If it appears that a sufficient volume of transactions was failed, then this should really be investigated. 

Third Conclusion: For the plight of this country, we are all liable as a society, as businesses and civil personnel. For our huge debt we do not blame anyone other than ourselves. So this text was not written to show that some evil people conspired against the innocent and isolated Greece. What the above texts shows is that Greece, already the weakest link in the Eurozone, became the target of devaluing pressures and the decisions of the Bank of Greece contributed in this, along with other ‘players’ that are not the subject at this present time.

Fourth Conclusion: There is no reason for anyone in Greece, to want to bet on the devaluation of Greek bonds. (At least I would want to believe so) The things that have been said are sad, and quite disturbing… Not because  it is impossible for some people to want the country to go to the IMF, but because playing with government bonds in the format that was described above only equals to dropping a nuclear bomb on your neighbour’s house because they have the music too loud. 

(But then again… shit happens… and when it comes to money… and the greed of the elite nothing would surprise me… )

Fifth Conclusion: We have been hearing about many scandals and stock/bond “bubbles” all these years from around the world. Nevertheless, there is no bigger “bubble” and a greater scandal than gambling with the government bonds of a country. Even the case of insurance funds bonds, which was huge, rather seems minor in comparison to the consequences of the collapsing bonds of a country. This is utterly “game over”.
Sixth Conclusion: Greeks had it coming.

So dear friends…  it is rather depressing isn't it? Yet this is exactly what the Bank of Greece did, with the blessing of the PASOK government. The Greek people have every right to know how and why they were sold to the IMF and foreign readers have every right to know what game was played against us, because we are an “experiment” for things to come. And it is important for you to know this because the unscrupulous speculators from the IMF banking cartel will not hesitate to do the exact same thing to your country as well. They’ve proven that they have the will ($$$$$$$) and the determination to do it.

Note: You can watch the news live here every night at 20:00 Greek time… 15:00 North American time- (link: Kontra TV Channel )
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