Curious why the topic of tomorrow's €430 million non-Greek law bond maturity
payment (which we first
pointed out as a D-Day type of cash outflow for the Greek people) is
particularly touchy? Simple: if Greece makes the payment it will see its already
in the red cash balance drop by another 30% to a sub redline €1
billion. Which would mean the country will likely not pass go and go straight
into looting mode once the people realize that some evil, evil hedge fund hold
outs (who are doing precisely what they are contractually entitled
to, and what we said back
in January would be the event that breaks the bank, i.e., holding out) have
been paid in full despite the Greek restructuring, while there is no money to
pay anything else... Because as Bloomberg
points out, "the level of funds in Greece’s state coffers has fallen
below 1.5 billion euros ($1.9 billion), Imerisia reported, citing “reliable
information.” If the state doesn’t receive predicted revenue for the
rest of this month, it will find it difficult to pay for social services,
pensions and public-sector wages, the newspaper said." Translation: when
the money runs out, it's game over. But it will also
be game over if and when Greece either does not want to or does not have the
cash to pay tomorrow.
Things are moving fast now.
Things are moving fast now.
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