submitted by jwithrow.
Journal of a Wayward Philosopher
When Countries Go Bankrupt
June 30, 2015
Hot Springs, VA
The S&P closed out Monday at $2,058. Gold closed at $1,179 per ounce. Oil checked out at $58 per barrel, and the 10-year Treasury rate closed at 2.33%. Bitcoin is trading up around $262 per BTC as the Greek crisis continues to play out.
Dear Journal,
I have been musing on the modern credit system in my last few journal entries and, ‘lo and behold, Greece has presented us with a real-time example of what happens when the credit expansion hits the wall.
Panos Kammenos, head of the government’s coalition ally in Greece, appeared on local television this past Saturday. “Citizens should not be scared, there is no blackmail,” Kammenos assured the Greek people. “The banks won’t shut, the ATMs will (have cash). All this is exaggeration.”
The very next day Prime Minister Alexis Tsipras announced that banks in Greece would not open on Monday. “In the coming days, what’s needed is patience and composure,” Tsipras proclaimed. “The bank deposits of the Greek people are fully secure.”
Here are the details of the Greek government’s capital controls:
- From Monday, June 29, 2015, banks will remain closed up to and including Monday, July 6
- Deposits are fully safeguarded
- The payment of pensions is exempted from the restrictions on banking transactions.
- Management of credit institutions will announce how these will be paid
- Electronic transactions within the country won’t be affected. All transactions with credit or debit cards and other electronic forms (web banking, phone banking) can be conducted as normal
- Prepaid cards may be used to the limit existing before the beginning of the bank holiday
- From midday June 29, ATMs will operate with a daily cash withdrawal limit of 60 euros per card, which is equivalent to 1,800 euros a month
- Foreign tourists can make cash withdrawals from ATMs with their cards without restrictions provided these have been issued abroad
- A special Committee to Approve Bank Transactions has been established at the State General Accounting Office in cooperation with the Finance Ministry, the Bank of Greece, the Union of Greek Banks and the Capital Markets Commission. This committee will deal with applications for urgent and imperative payments that can’t be satisfied through the cash withdrawal limits or by electronic transactions (e.g. payments abroad for health reasons). Wages paid electronically to bank accounts aren’t affected.
