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Greek companies are ready for the worst…cash is already overseas

As Greece and its creditors head for a showdown that’s raising the spectre of the country’s exit from the euro or the imposition of capital controls, crisis-hardened company executives, say the drawn-out crisis has prepared them for the worst.

Alex Christoforou

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Post originally appeared on Bloomberg.

George Alevizos knows what it’s like to live with capital controls.

The finance manager at Fourlis Holdings SA, which has the franchise for Ikea furniture stores in Greece, Cyprus and Bulgaria, saw the company’s Cypriot sales fall about 30 percent in the three months immediately after that country’s rescue in March 2013.

Now as Greece and its creditors head for a showdown that’s raising the spectre of the country’s exit from the euro or the imposition of capital controls, crisis-hardened company executives, although nervous, say the drawn-out turbulence has prepared them for the worst.

“We have faced this kind of issue with the operation in Cyprus,” Alevizos said in an interview. “Short-term, however, there is always severe turbulence.”

Since Greece sparked the euro area debt crisis in 2009, companies have been living with banks unable to lend, an economy struggling to emerge from recession and the shadow of uncertainty over the country’s future in the euro area. The tumultuous times have taught them valuable lessons — from keeping their cash overseas to developing export markets, executives said.

That preparation may be put to the test as Greece and its creditors fail to strike a deal on reforms Prime Minister Alexis Tsipras has to deliver to get as much as 7.2 billion euros ($8.2 billion) from the country’s existing bailout funds. With the bailout program expiring at the end of the month, time may be running out. That could mean capital controls like those in Cyprus in 2013, the first in a euro country. Companies have been quietly preparing for that possibility.

Sarantis’s Story

Take Sarantis, a distributor of products ranging from Estee Lauder cosmetics to insect repellents. The company’s cash has been kept outside Greece since the Cyprus crisis. Sarantis would probably see a fall in sales as the cost of imported goods rise if there are capital restrictions or an exit from the euro, Kostas Rozakeos, the company’s chief financial officer, said in a call with analysts.

The upside to an exit from the euro would be that the company would have lower production costs because its cash is abroad and will remain in foreign currency, he said.

“At the end of the day, Sarantis will have benefits,” he said. “I don’t wish that as a citizen, as a Greek citizen, but talking about this as a businessman, I can see opportunities.”

Sarantis will be the big guy on the block as smaller, weaker rivals succumb to the Greek cash crunch, he said.

More than 100 billion euros of deposits held by businesses and households in Greece have left its banking system since the end of 2009, with losses deepening since the beginning of this year, when the anti-austerity Tsipras government came to power.

Block Flows

The stalemate in talks between Greece and creditors over the last few months prompted JPMorgan analysts to write on June 1 that the impasse makes capital controls more likely “to nail down bank deposits, preventing portfolio type flows.”

In some ways, the controls may be too little too late. Companies, reading the writing on the wall, have kept funds outside Greece when they could.

Titan Cement Co., which rode out the financial crisis in the U.S. in 2008 and a revolution in 2011 in Egypt, has most of its cash reserves overseas. Cyprus-style controls may be a possibility for Greece, although an exit from the euro seems unlikely, Chief Executive Officer Dimitrios Papalexopoulos told analysts on a call last month.

“We are net exporters, so we will have excess foreign currency rather than a shortage,” he said. International operations of the Athens-based cement maker are self-sufficient and the company has credit facilities from foreign, not Greek, banks, he said.

Sufficient Liquidity

Of Titan’s cash reserves of 138 million euros only 12 million euros are in Greece. About 70 million euros are with holding companies and European banks outside the country.

Dixon Carphone Plc, which owns the Kotsvolos appliance chain, has had contingency plans in place for a Greek euro exit since at least May 2012, when Tsipras’s Syriza party emerged on the political scene as a potential contender to run the country.

“We have plans in terms of how our stores will close and reopen, we have plans in terms of how we manage consumer credit arrangements and we have a plan in terms of how we make sure that we get stores open and trading as quickly as possible,” Chief Executive Officer Sebastian James said at the time.

He repeated this month that the events may present an opportunity to gain market share.

Hellas Direct, a Cyprus-based car insurer operating in Greece in which U.S. billionaire Daniel Loeb’s Third Point Hellenic Recovery Fund has a 20 percent stake, has always kept cash out of Greece and Cyprus.
In Greece, “we only keep operational cash locally and sweep up capital on a weekly basis,” said Alexis Pantazis, co-founder of the company. “Even in the case of capital controls being imposed, we would have sufficient liquidity to continue as is.”

References:

http://www.bloomberg.com/news/articles/2015-06-16/greek-capital-controls-baked-in-as-companies-store-cash-abroad

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US media suffers panic attack after Mueller fails to deliver on much-anticipated Trump indictment

Internet mogul Kim Dotcom said it all: “Mueller – The name that ended all mainstream media credibility.”

RT

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Via RT


Important pundits and news networks have served up an impressive display of denials, evasions and on-air strokes after learning that Robert Mueller has ended his probe without issuing a single collusion-related indictment.

The Special Counsel delivered his final report to Attorney General William Barr for review on Friday, with the Justice Department confirming that there will be no further indictments related to the probe. The news dealt a devastating blow to the sensational prophesies of journalists, analysts and entire news networks, who for nearly two years reported ad nauseam that President Donald Trump and his inner circle were just days away from being carted off to prison for conspiring with the Kremlin to interfere in the 2016 presidential election.

Showing true integrity, journalists and television anchors took to Twitter and the airwaves on Friday night to acknowledge that the media severely misreported Donald Trump’s alleged ties to Russia, as well as what Mueller’s probe was likely to find. They are, after all, true professionals.

“How could they let Trump off the hook?” an inconsolable Chris Matthews asked NBC reporter Ken Dilanian during a segment on CNN’s ‘Hardball’.

Dilanian tried to comfort the CNN host with some of his signature NBC punditry.

“My only conclusion is that the president transmitted to Mueller that he would take the Fifth. He would never talk to him and therefore, Mueller decided it wasn’t worth the subpoena fight,” he expertly mused.

Actually, there were several Serious Journalists who used their unsurpassed analytical abilities to conjure up a reason why Mueller didn’t throw the book at Trump, even though the president is clearly a Putin puppet.

“It’s certainly possible that Trump may emerge from this better than many anticipated. However! Consensus has been that Mueller would follow DOJ rules and not indict a sitting president. I.e. it’s also possible his report could be very bad for Trump, despite ‘no more indictments,'” concluded Mark Follman, national affairs editor at Mother Jones, who presumably, and very sadly, was not being facetious.

Revered news organs were quick to artfully modify their expectations regarding Mueller’s findings.

“What is collusion and why is Robert Mueller unlikely to mention it in his report on Trump and Russia?” a Newsweek headline asked following Friday’s tragic announcement.

Three months earlier, Newsweek had meticulously documented all the terrible “collusion” committed by Donald Trump and his inner circle.

But perhaps the most sobering reactions to the no-indictment news came from those who seemed completely unfazed by the fact that Mueller’s investigation, aimed at uncovering a criminal conspiracy between Trump and the Kremlin, ended without digging up a single case of “collusion.”

The denials, evasions and bizarre hot takes are made even more poignant by the fact that just days ago, there was still serious talk about Trump’s entire family being hauled off to prison.

“You can’t blame MSNBC viewers for being confused. They largely kept dissenters from their Trump/Russia spy tale off the air for 2 years. As recently as 2 weeks ago, they had @JohnBrennan strongly suggesting Mueller would indict Trump family members on collusion as his last act,” journalist Glenn Greenwald tweeted.

While the Mueller report has yet to be released to the public, the lack of indictments makes it clear that whatever was found, nothing came close to the vast criminal conspiracy alleged by virtually the entire American media establishment.

“You have been lied to for 2 years by the MSM. No Russian collusion by Trump or anyone else. Who lied? Head of the CIA, NSA,FBI,DOJ, every pundit every anchor. All lies,” wrote conservative activist Chuck Woolery.

Internet mogul Kim Dotcom was more blunt, but said it all: “Mueller – The name that ended all mainstream media credibility.”

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Canadian Lawmaker Accuses Trudeau Of Being A “Fake Feminist” (Video)

Rempel segued to Trudeau’s push to quash an investigation into allegations that he once groped a young journalist early in his political career

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Via Zerohedge

Canada’s feminist-in-chief Justin Trudeau wants to support and empower women…but his support stops at the point where said women start creating problems for his political agenda.

That was the criticism levied against the prime minister on Friday by a conservative lawmaker, who took the PM to task for “muzzling strong, principled women” during a debate in the House of Commons.

“He asked for strong women, and this is what they look like!” said conservative MP Michelle Rempel, referring to the former justice minister and attorney general Jody Wilson-Raybould, who has accused Trudeau and his cronies of pushing her out of the cabinet after she refused to grant a deferred prosecution agreement to a Quebec-based engineering firm.

She then accused Trudeau of being a “fake feminist”.

“That’s not what a feminist looks like…Every day that he refuses to allow the attorney general to testify and tell her story is another day he’s a fake feminist!”

Trudeau was so taken aback by Rempel’s tirade, that he apparently forgot which language he should respond in.

But Rempel wasn’t finished. She then segued to Trudeau’s push to quash an investigation into allegations that he once groped a young journalist early in his political career. This from a man who once objected to the continued use of the word “mankind” (suggesting we use “peoplekind” instead).

The conservative opposition then tried to summon Wilson-Raybould to appear before the Commons for another hearing (during her last appearance, she shared her account of how the PM and employees in the PM’s office and privy council barraged her with demands that she quash the government’s pursuit of SNC-Lavalin over charges that the firm bribed Libyan government officials). Wilson-Raybould left the Trudeau cabinet after she was abruptly moved to a different ministerial post – a move that was widely seen as a demotion.

Trudeau has acknowledged that he put in a good word on the firm’s behalf with Wilson-Raybould, but insists that he always maintained the final decision on the case was hers and hers alone.

Fortunately for Canadians who agree with Rempel, it’s very possible that Trudeau – who has so far resisted calls to resign – won’t be in power much longer, as the scandal has cost Trudeau’s liberals the lead in the polls for the October election.

 

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Why Joe May be Courting Stacey

Joe Biden has a history on compulsory integration dating back to the 1970s that Sen. Jesse Helms called “enlightened.”

Patrick J. Buchanan

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Authored by Patrick Buchanan via The Unz Review:


Of 895 slots in the freshman class of Stuyvesant High in New York City, seven were offered this year to black students, down from 10 last year and 13 the year before.

In the freshman class of 803 at The Bronx High School of Science, 12 students are black, down from last year’s 25.

Of 303 students admitted to Staten Island Technical High School, one is African-American.

According to The New York Times, similar patterns of admission apply at the other five most elite high schools in the city.

Whites and Asians are 30 percent of middle school students, but 83 percent of the freshman at Bronx High School of Science, 88 percent at Staten Island Technical and 90 percent at Stuyvesant.

What do these numbers tell us?

They reveal the racial composition of the cohort of scientists and technicians who will lead America in the 21st century. And they tell us which races will not be well represented in that vanguard.

They identify a fault line that runs through the Democratic Party, separating leftists who believe in equality of results for all races and ethnic groups, and those who believe in a meritocracy.

Mayor Bill de Blasio has expressed anger and frustration at the under-representation of blacks and Hispanics in the elite schools. But Gov. Andrew Cuomo and the state legislature have ignored his pleas to change the way students are admitted.

Currently, the same test, of English and math, is given to middle school applicants. And admission to the elite eight is offered to those who get the highest scores.

Moreover, Asians, not whites, are predominant.

Though 15 percent of all middle school students, Asians make up two-thirds of the student body at Stuyvesant, with 80 times as many slots as their African-American classmates.

The egalitarian wing of the Democratic Party sees this as inherently unjust. And what gives this issue national import are these factors:

First, the recent scandal where rich parents paid huge bribes to criminal consultants to get their kids into elite colleges, by falsifying records of athletic achievement and cheating on Scholastic Aptitude Tests, has caused a wave of populist resentment.

Second, Harvard is being sued for systemic reverse racism, as black and Hispanic students are admitted with test scores hundreds of points below those that would disqualify Asians and whites.

Third, Joe Biden has a history on compulsory integration dating back to the 1970s that Sen. Jesse Helms called “enlightened.”

Here are Biden’s quotes, unearthed by The Washington Post, that reflect his beliefs about forced busing for racial balance in public schools:

“The new integration plans being offered are really just quota systems to assure a certain number of blacks, Chicanos, or whatever in each school. That, to me, is the most racist concept you can come up with.

“What it says is, ‘In order for your child with curly black hair, brown eyes, and dark skin to be able to learn anything, he needs to sit next to my blond-haired, blue-eyed son.’ That’s racist!

“Who the hell do we think we are, that the only way a black man or woman can learn is if they rub shoulders with my white child?

“I am philosophically opposed to quota systems. They insure mediocrity.”

That was 44 years ago. While those views were the thinking of many Democrats, and perhaps of most Americans, in the mid-’70s, they will be problematic in the 2020 primaries, where African-Americans could be decisive in the contests that follow Iowa and New Hampshire.

Biden knows that just as Bernie Sanders, another white male, fell short in crucial South Carolina because of a lack of support among black voters, he, too, has a problem with that most loyal element in the Democratic coalition.

In 1991, Biden failed to rise to the defense of Anita Hill when she charged future Justice Clarence Thomas with sexual harassment. In the Senate Judiciary Committee, he was a law-and-order champion responsible for tough anti-crime legislation that is now regarded as discriminatory.

And he has a record on busing for racial balance that made him a de facto ally of Louise Day Hicks of the Boston busing case fame.

How, with a record like this, does Biden inoculate himself against attacks by rival candidates, especially candidates of color, in his run for the nomination?

One way would be to signal to his party that he has grown, he has changed, and his 2020 running mate will be a person of color. Perhaps he’ll run with a woman of color such as Stacey Abrams, who narrowly lost the 2018 governor’s race in Georgia.

An ancillary benefit would be that Abrams on the ticket would help him carry Georgia, a state Donald Trump probably cannot lose and win re-election.

Wrote Axios this morning:

“Close advisers to former Vice President Joe Biden are debating the idea of packaging his presidential campaign announcement with a pledge to choose Stacey Abrams as his vice president.”


Patrick J. Buchanan is the author of “Nixon’s White House Wars: The Battles That Made and Broke a President and Divided America Forever.”

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