Living the Low Life in Greece

by John Fund

While the Greek government prepares to do battle with European finance ministers in new negotiations tomorrow, the outlook for average Greeks is looking bleaker than ever.

Promises from left-wing prime minister Alexis Tsipras that banks would reopen tomorrow for normal business were merely a mirage. The question now is whether Greeks will still be able to withdraw even the limited $66 a day from their ATMs. Greek banks are running out of cash and some are limiting withdrawals to $55 a day. In addition, new controls limit transfers between Greek banks to $16,500 — an attempt to end depositors’ trying to put their money in banks that are perceived to be less shaky than others.

Things will get worse. Anastasios Economou, founder of the investment firm iGroup, told CNBC that his employees are asking not to be paid on time. They believe the Greek government may be about to raid bank deposits and confiscate part of them. “People apparently trust their employers to hold on to their money more than the banks that are subject to government fiat,” he told CNBC.

The Greek economy continues to fall. There are “50,000 tourists missing per day,” Economou said, a shortfall that badly hurts one of the pillars of Greece’s economy. 

As for the prospect of a quick deal to stabilize Greece, Economou is skeptical. “What you’re seeing is a . . . decoupling of Greece and the rest of Europe,” he said. “One thing is certain, the ‘no’ vote has pushed any possibility of a deal further out.”

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