The curious story of the day is back-to-back reports, minutes apart, by the same news agency, saying different things.
I commented on that just a bit ago in Greece Says Creditor Agreement Deal Close, Senior Eurozone Official Says "I Wish it Were True".
There is no proof Greece is the one lying, but Greece certainly benefits more from such a lie, two different ways.
- Lies buy Greece more time to prepare capital controls
- Lies may stop some panic out of Greek banks
Assuming point number two is in play, I did a search for "Greek bank deposit outflows". Three stories from today popped right up. Here are two of them.
Run on Banks Accelerates
Please consider ECB Halts Emergency Funding Hike to Greek Banks.
The European Central Bank on Wednesday did not raise a ceiling on emergency funding for Greek banks in a weekly review for the first time since February, a banking source said, adding financial pressure as the country scrambles to stay solvent.
Greek banks have survived on the emergency liquidity assistance (ELA) since largely losing access to capital markets and the ECB's main funding window.
The ECB has been raising the cap on ELA in increments, but there has been opposition from within the bank to doing so each week on concerns it helps finance the Greek government. The banking source said the ceiling was unchanged because deposit outflows had slowed to low levels, leaving an untapped liquidity cushion.
But Greek newspaper Kathimerini reported on Wednesday that deposit outflows had picked up in the last days on worries over the possibility of capital controls. Official data on deposit outflows in April will be released on Thursday.
The ECB declined to comment.
Greek Bank Outflows Accelerate, Reached 5 Billion Euros in April
CNBC reports Greek Bank Outflows Accelerate, Reached 5 Billion Euros in April.
Greek banks have seen deposit outflows accelerate over the past week as fears rise that the euro zone country will default on debt, two banking sources said on Wednesday.
The spike follows a steady outflow of money from Greek lenders this year as Athens and its creditors struggle to agree an aid-for-reforms deal before Greece runs out of money.
"The past week in May was more challenging compared to the previous ones in the month, with daily outflows of 200 to 300 million euros in the last few days," a senior Greek banker said.
Outflows picked up in April to about 5 billion euros ($5.44 billion) from 1.91 billion euros in March, three Greek bankers told Reuters. Official data on April deposits will be released by the Bank of Greece on Thursday.
Speculation about capital controls has resurfaced after a prominent lawmaker from the conservative opposition said she was worried about the prospect if no deal is reached with creditors and Athens defaults on an IMF payment next month. The government's spokesman has dismissed such a scenario.
Untangling the Lies
It's possible that Greece will reach an agreement, but here are the lies as I see them now.
- Greece is not close to an agreement with creditors as Greek officials claim.
- The ECB is telling a whopper about outflows from Greek banks slowing.
- In contrast to official statements, capital control measures are in the works.
To untangle the lies, all one had to do was look at what's really happening. Here is the single most believable statement made by anyone ...
"The past week in May was more challenging compared to the previous ones in the month, with daily outflows of 200 to 300 million euros in the last few days," a senior Greek banker said.
