Under the cushion | eKathimerini.com

Christmas shoppers throng Ermou Street in downtown Athens. Consumption, which is one of the engines of economic growth right now, is going to be hit by the coming wave of inflation, says the writer. [InTime News]

European Central Bank President Christine Lagarde has said she will not allow gambling with Greek bonds and announced measures that will ensure Greece will keep borrowing costs low even after the end of the debt program. emergency pandemic purchase (PEPP) in March 2022. A waiver had been granted to include Greek government securities even if they are a few notches below the investment grade.

From now on, two things will happen: the ECB will reinvest the maturing principal payments of Greek bonds into Greek bonds and it will also be able to buy Greek bonds with some of the money from maturing private and government securities. other Member States. This reinvestment will last “at least until the end of 2023”, specifies the ECB. If necessary, the ECB can relaunch the PEPP.

Essentially, the ECB is providing a cushion for Greece until it regains the solvency that will allow it to participate in the regular securities buying program, which is expected to occur by the end of 2022.

The question is whether we will take advantage of the cushion to put a spring in our step or if we will lie down with content. Our political system makes the second option more likely.

One indication is his obvious predisposition to turn tough situations a favor and hide thorny issues under the mat – or under the cushion, if you prefer. It is happening with the economy and something similar is happening with the pandemic: sometimes we’re supposed to go the last mile, at others we’re supposed to have a perfect intensive care system, and the chorus permanent is that there is never, always a need for additional protective measures – even as our gruesome level of death approaches European highs, relative to the total population. And all of a sudden a study, like that of Professors Sotiris Tsiodras and Theodoros Lytras, falls like a bomb and the scene changes dramatically: everyone, including top government officials, simultaneously learns that we don’t have the best intensive care units in the best national health. System of the best prepared country in Europe …

Positive spins abound in economic policy as well. It is said that we have solved the problem of nonperforming loans when what really happened is that the banks discharged them from their accounts to the custody of the funds, where they lie in puddles of stagnant water. We are saying that we are enjoying explosive growth, when what is really happening is a rapid recovery from heavy GDP losses but with all the structural weaknesses left intact, hence the rapid growth of a “black hole” in the economy. balance of payments and the persistence of unemployment at dramatic levels. It is said that we will quickly implement all projects funded by the EU Recovery and Resilience Fund and the fact that we have transferred all projects funded by European Structural Funds to the recovery program is not mentioned, hence the growing concerns about the absorption of Structural Fund resources in the years to come.

To solve a problem, you must first understand it. We don’t do that; instead of looking at the mountain of debt, we are happy to be able to borrow more, but at lower rates, thanks to the ECB. Instead of worrying about economic growth based in part on consumption (which will take a hit in the coming inflationary wave, which we also pretend not to see…), we derive a perverse national pride from it. Instead of worrying about the climate crisis, we are OK because the investments supported by the Stimulus Fund “will not seriously harm the environment” and we are facing extreme weather events and flooding like we did the fires. forest, clearing areas. We move residents as a precaution, but the inadequate infrastructure remains and awaits them – like the wall in front of us, ready to absorb our breakdown.


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