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No longer clearing transfers with the Greek central bank would be pretty final.

To add to your list:

Eurogroup: Tools: Capital controls, see Cyprus. Goals: Excluding outsiders from power, crushing of the Class enemy.

Commission: Grabbing as much power from the Eurogroup as possible. Tools: Bureaucratic infighting. Collaboration with the Class Enemy. Everything else that can be done without a budget.

Not only are Syrizia political outsiders, this would be the first leftwing government in Europe since [fill in once an example comes to mind]. I'm sure the reactionaries will go to extremes if they fail to force a surrender/betrayal.

by generic on Mon Mar 2nd, 2015 at 12:32:03 PM EST
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Not only are Syrizia political outsiders, this would be the first leftwing government in Europe since [fill in once an example comes to mind].
Remember that Cyprus had a Communist government at the time of the 2003 bank crisis and imposition of capital controls... but Communist and all it was fully on board with the island's "offshore hedge fund" business model.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Carrie (migeru at eurotrib dot com) on Mon Mar 2nd, 2015 at 12:48:07 PM EST
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I remembered actually, but as you say Cyprus was hardly known for its socialist economic policy. Though I wouldn't be surprised if the Euro ministers didn't remember until they decided to ground it into the dust.
by generic on Mon Mar 2nd, 2015 at 03:55:21 PM EST
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Cyprus was the banker to too many Russian oligarchs. Obviously a legitimate target.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Mar 2nd, 2015 at 10:46:52 PM EST
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No longer clearing transfers with the Greek central bank would be pretty final.

The full power of the US Treasury's vaunted 'economic warfare' unit would be employed to trash anything they try to do through Western clearing houses, BIS, Western Central Banks, etc. I would expect them to try to achieve what the USA did with Cuba October '60, but without the formal embargo. But now there is an alternate clearing system coming into operation through China, Singapore, Hong Kong, etc. But having to suddenly re-route all of your trade and finance arrangements in a day or two would be catastrophic in the short term. OTOH, so would be continuing with the insisted 'austerity'. And cutting Greece off from Western international clearing would make it impossible for Greece to deal with its debts and would be like the ECB, EC, and IMF locking Greece out of the Euro area, analogous to manufacturers locking out workers in a strike. By making it impossible to pay they would, in a sense, be giving Greece cover to default. It would be the market's reaction to the tens to hundreds of dollars worth of defaulted debts held by various banks that would then come into play.

Such an action would also provide a justification for Syriza and Greece to make any deal they could find with Russia and China, along with any one else who would accept payment in currencies other than the Euro, US$, of various western major currencies. It might be awkward for the US Treasury and/or the BIS to prevent an oil exporter such as Indonesia or Brunei from settling for oil shipments in their own currency or Chinese Yuan. I certainly don't know, nor do I suspect does anyone else with a high degree of certainty.

I think it would be a high stakes roll of the dice.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Mar 2nd, 2015 at 11:05:21 PM EST
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