Monday 28 May 2012

Greeks take out their anger on Christine Lagarde

Go to the Facebook page - you can see for yourself!
Irate Greeks vilify IMF chief on Facebook after she brands them tax dodgers
Christine Lagarde has been forced to express her sympathy for the Greek people after receiving 10,000 messages on Facebook, many of them obscene.

The Telegraph,
27 Mat, 2012

The head of the International Monetary Fund has been forced to express her sympathy for the Greek people after politicians and irate locals vilified her for saying the country was a nation of tax dodgers.

After being bombarded on her Facebook page with 10,000 messages, many of them obscene, Christine Lagarde took to the social networking site to say she was “very sympathetic to the Greek people and the challenges they are facing”.

Despite the emergence this afternoon of a new Facebook page titled “Greeks are against Lagarde”, she reiterated that everyone should pay their taxes.
Greek politicians were similarly engraged, with socialist party leader Evangelos Venizelos claiming she had “insulted the Greek people”.

The backlash came as Greece’s former prime minister warned the country could run out of the money by the end of June if bailout funds are withdrawn after next month’s election.

Lucas Papademos said that, within days of the June 17 poll, Athens risked having a cash shortfall of €1bn (£800m).

From late June onwards, the ability of the government to fund its obligations fully depends on the approval of the subsequent instalments of loans from the European Financial Stability Facility and the IMF,” he said.

Such funds would be put at risk by a re-run of the May 6 poll, which failed to produce a government willing to implement the austerity cuts promised earlier this year to win Athens a second bailout.

The available funds in the Greek government will be reduced gradually from about €3.8bn on May 11 to about €700m on June 18 and from June 20 will enter negative territory at the level of around €1bn,” Mr Papademos said in a memo leaked to the To Vima newspaper.

Elsewhere in the eurozone, the president of Spanish lender Bankia, bailed out to the tune of €23.5bn, was forced to clarify his comments that “we don’t need to talk about giving any of it back”. Jose Ignacio Goirigolzarri said the money would be treated as an investment, not a loan.

Spain is considering directly injecting its own government debt into Bankia as part of the rescue, in an attempt to avoid borrowing money directly from the bond markets, The Financial Times reported on Sunday night.

Under the plans, the Spanish government would issue state-backed debt to Bankia in return for equity, with the bank then able to deposit the bonds with European Central Bank as collateral for cash. Analysts said the move was extremely unusual and may anger the ECB.

The latest bank bailout has triggered renewed efforts in Brussels to devise a eurozone fund, financed by a levy on all lenders, that would rescue any in trouble.

Raoul Rupparel, head of economic research at think tank Open Europe, said such a plan had some merit but added: “I question how quickly it could get off the ground and, even if it raised tens of billions in its first year, that would barely cover Spain”.

Outside the eurozone, Swiss National Bank President Thomas Jordan said a panel of government officials is considering measures including capital controls to weaken the franc should the euro crisis escalate.

The working group focuses mainly on instruments to combat the franc strength based on a joint approach of the government and the central bank,” he told SonntagsZeitung in an interview. “We also need to be prepared for the possibility of the currency union collapsing, even though I don’t expect it.”

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