After almost six months of endless discussions Angela Merkel, the German Chancellor and President Hollande of France, have fears that Greece could leave the EUROZONE.
Today the EUROZONE, after the Greek Referendum, wanted Tsipras to explain again, what he wanted ! After six months, still no one knew ?
If Greece leaves the EUROZONE it would renounce its Debts and declare it is Bankrupt. It has debts with the EUROZONE amounting to 320 Billion Euros ! This includes debts to Germany of 60 Billion.
If Greece obtains a deal that permits it to keep the EURO as its currency, it will remain in the EUROZONE. The DEAL Tsipras needs implies that creditors accept to write off at least 35% of the loan amount outstanding.
In addition, Tsipras really also needs time, a breathing space during which no repayments are due while he reorganises Greece. He needs a Moratorium of a few years.
Greek debts are totally worthless, because the country is bankrupt. The EURO has also depreciated by at least 10% during the last 12 months. How long will this strong EURO last ? If ever Greece repaid its debts it could be in "new Euros" !
Angela Merkel knows all the foregoing implications, but she cannot make a decision. German politicians are split on what should be done, even in her Coalition. Will she obtain a majority in the Bundestag Parliament for her Greek solution ?
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