Potential for panic

Editorial note: If you have not yet read our mission statement above, please do so in order that you can put our blogs in context. 

 16 May 2012

GREAT FEAR THAT COULD DEVELOP INTO A PANIC – BANK CHIEF

At least 700 million euros was withdrawn from Greek banks in the week up to last Monday 14 May 2012, Greek President Karolos Papoulias is quoted as saying in a BBC report today 16 May.

But there are no signs of a bank run, according to the BBC report.

However, the Financial Times is cited by the BBC as quoting Athens-based bankers to the effect that withdrawals exceeded 1.2bn euros on Monday 14 May and Tuesday 15 May. That is said to amount to 0.75% of deposits.

Moreover, in minutes of talks on Tuesday with Greek political parties, President Papoulias is quoted as saying:

“[Greek central bank chief George] Provopoulos told me there was no panic, but there was great fear that could develop into a panic.”

However, according to the BBC, there were no signs of panic or queues outside banks in Athens today 16 May.

The patchwork of political parties that emerged from the recent parliamentary elections on 6 May 2012 failed to agree on the composition of a new government, so fresh elections are to be held on 17 June 2012.

Syriza, a coalition of radical leftwing groups, is tipped to come top in the poll. While opposing austerity measures imposed on Greece by the EU and the IMF in exchange for emergency loans, Syriza says it wants to retain the euro as the country’s currency instead of resurrecting the drachma.

Many commentators believe, however, that if Greece rejects the austerity package it will have to leave the eurozone willy-nilly.

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 You might perhaps care to view some of our earlier posts.  For instance:

 1. Why? or How? That is the question (3 Jan 2012)

2. Das Vierte Reich/The Fourth Reich (6 Feb 2012)

3. The shoddiest possible goods at the highest possible prices (2 Feb 2012)

4. Where’s the beef? Ontology and tinned meat (31 Jan 2012)

5. What would Gandhi have said? (30 Jan 2012)

Every so often we shall change this sample of previously published posts.

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