2016-12-01bloomberg.com

This isn't just your standard tale of a bondholder trying to boost the value of his investments by talking his book. What Kazarian has tried to do for the past four years is treat the sovereign nation of Greece the same way he might a private company he'd taken over: by detailing its assets and liabilities, looking for ways to enhance asset value while reducing liabilities, and, most importantly, seeking to install his own managers to take charge. The more you reflect on that latter notion, the more disturbing Kazarian's larger-than-life presence on the Greek financial scene becomes.

...

Give or take, everyone else agrees that Greece's debts are equal to about 170 percent of its gross domestic product... But Kazarian says people who arrive at that number are suffering from "a major, major, major, major flaw in their model." He gets to a much more manageable (or downright virtuous) debt ratio of 45 percent by accounting for every previous restructuring as a debt cancellation, and treating all of the supposed assets of the country as if they were the factories, inventory and intellectual property of a company.

... there's a crucial, insurmountable difference between a bust company and a bankrupt nation: In the latter, the creditors don't (and indeed shouldn't) get to decide who's in charge.

...

After shrinking this year and last year, economists are forecasting growth of just 1 percent in 2017 (lower than the official forecast). Sympathizers ranging from the IMF to President Barack Obama remain convinced that Greece cannot escape its doldrums without a further reduction in the debt burden. EU minister say they will discuss the issue when they meet next week. Investors may currently be fixated on Italian politics, but Greece's problems could also boil over.



Comments: Be the first to add a comment

add a comment | go to forum thread