During the first warrant period, the shareholders in Alpha bank bought back the first 2.4% of HFSF shares. These findings offer insight into the unsustainable macroeconomic dynamics that preceded the crisis – capital accumulation was artificially driven up by a real estate bubble,10 and was especially pernicious because investments in overvalued assets were financed through external borrowing. Greece attempted to reassure the EU lenders it was fiscally responsible. ", "Marianne: The incredible errors by IMF experts & the wrong multiplier", "General government gross debt - annual data", "The Second Economic Adjustment Programme for Greece (Third review)", "Investors exercise about 2.4 pct of Alpha Bank warrants", "Results of the exercise of titles representing share ownership rights (Warrants) – 1st Exercise", "Investors exercise fraction of Greece's National Bank warrants", "Press Release: National Bank of Greece's Share Capital Increase", "Press Release: Approval of the Institutional Investors Group for Eurobank's Share Capital Increase", "Are investors getting a bargain with Eurobank? EU leaders and bond rating agencies wanted to make sure Greece wouldn't use the new debt to pay off the old. [21] In contrast, Italy was able (despite the crisis) to keep its 2009 budget deficit at 5.1% of GDP[35], which was crucial, given that it had a public debt to GDP ratio comparable to Greece's [21]. Keep going :-). MacroPolis. The crisis triggered the eurozone debt crisis, creating fears that it would spread into a global financial crisis. Labour costs increased more (from a lower base) in peripheral countries such as Greece relative to core countries such as Germany without compensating rise in productivity, eroding Greece's competitive edge. [92][93][94], For example, at the beginning of 2010, it was discovered that Goldman Sachs and other banks had arranged financial transactions involving the use of derivatives to reduce the Greek government's nominal foreign currency debt, in a manner that the banks claim was consistent with EU debt reporting rules, but which others have argued were contrary at the very least to the spirit of the reporting rules of such instruments. The ECB held 26.9 billion euros of Greek debt. They petitioned for the parliament or president to reject the referendum proposal. The results are mixed. [31], A trade deficit means that a country is consuming more than it produces, which requires borrowing/direct investment from other countries. It raised worker contributions to the pension system. What are the reasons for Greek Economy collapse? Consequently, Greece was "punished" by the markets which increased borrowing rates, making it impossible for the country to finance its debt since early 2010. But after the 2008 financial crisis, everything changed. The European Central Bank agreed to recapitalize Greek banks with 10 billion euros to 25 billion euros, allowing them to reopen..