The desperately needed bridge finance will give Greece breathing space as it embarks on the tortuous process of agreeing a three-year bailout that could be worth up to €86bn.

Around €50bn is likely to come from the eurozone’s permanent bailout fund, the European Stability Mechanism, which on Friday gave its approval for talks to commence.  The formal launch of talks on a three-year bailout comes after the Bundestag and other eurozone parliaments, including those in Austria, France and Finland, voted in favour of opening negotiations with Greece.  Germany, Greece’s largest creditor, has so far resisted large-scale debt relief and is implacably opposed to any step that could lead to reducing Greece’s debts. Schäuble argues that any reduction in Greece’s debts – known as a “haircut” – would be illegal under EU law.  The German finance ministry has said that giving Greece more time to pay its debts is a possibility but maintains that Greece’s current level of borrowing would be bearable if the country reformed its economy to spur economic growth.

The creditors have effectively set themselves a deadline of 20 August to resolve this argument. By that date Greece must repay €3.2bn to the ECB, but all emergency bridging finance will be exhausted by the end of July.  The €7bn bridging loan paves the way for an elaborate exercise in international shuffling of cash from one creditor to another.  Greece will use part of the €7bn from the EU to repay €4.2bn to the European Central Bank on Monday. Failure to make this payment could have forced Greece out of the eurozone. It will use another tranche of the loan to repay €2bn to the IMF to clear arrears, freeing the fund to lend Greece more money.

Grecia a achitat Fondului Monetar Internațional o serie de arierate în valoare totală de aproximativ două miliarde de euro și nu se mai află în incapacitate de plată. Anunțul a fost făcut de purtătorul de cuvânt al FMI, Gerry Rice, transmit Deutsche Welle și Reuters.'Prin urmare, Grecia nu mai are datorii restante către FMI', a explicat Gerry Rice. Acesta a adăugat: 'Așa cum s-a anunțat, FMI este gata să continue să asiste Grecia în eforturile de redresare a economie și de revenire a stabilității financiare'.  Luni, Grecia a plătit luni 4,2 miliarde de euro, reprezentând principalul și dobânzile dintr-un împrumut acordat anterior de BCE, și a rambursat un credit de 500 milioane de euro către Banca Centrală a Greciei.

Reprezentanții creditorilor internaționali (UE, BCE și FMI) și ai fondului de salvare al zonei euro (ESM) se vor afla în curând la Atena, a anunțat luni purtătorul de cuvânt al executivului european, Margaritis Schinas, transmite Agerpres.

The Federal Reserve is still on course to raise interest rates this year, as delays could mean the central bank is forced to hike more rapidly than it is safe later, its chairman has said.

Janet Yellen indicated that delaying increases in interest rates would mean that the central bank could "have to do so more rapidly" if caught behind the curve.   In her testimony before the Senate Committee on Banking on Wednesday, she said that if the economy progresses as expect, "economic conditions would make it appropriate at some point this year to raise" the Fed's key interest rate. ...Ms Yellen said: "The situation in Greece remains difficult. And China continues to grapple with the challenges posed by high debt, weak property markets and volatile financial conditions."   Mr Page said that the central bank would most likely start to raise its rates in September, but that it is not expect to clearly signal this until closer to that date. The Fed chairman remarked that "economic growth abroad could also pick up more quickly than observers generally anticipate, providing additional support for US economic activity".   Yellen has no intention of raising rates, as to do so would implode the asset bubbles and Ponzi schemes that allow the most efficient looting and asset stripping of the 99% by the Fed's oligarch accomplices. As long as ZIRP and QE can be maintained, savers and pensioners will be forced into the Wall Street-Federal Reserve Rigged Speculative Casino, where they can be fleeced at will by Yellen's Wall Street co-conspirators. So ignore the incessant droning by Yellen & other Fed mouthpieces about raising rates - it will not happen unless and until Yellen has to invervene to stop a dollar crash. The Fed's War on Savers and the responsible has no end in sight.

Senator Rand Paul on Tuesday officially sued the Obama administration, seeking to stop it from enforcing a federal banking law that has led large numbers of Americans overseas to renounce their citizenship.  In a move with implications for his 2016 presidential bid, Mr. Paul joined six other plaintiffs in a suit filed by Republicans Overseas Action (ROA), arguing that the Foreign Account Tax Compliance Act (FATCA) is unconstitutional. The 2010 law, passed by a Democratic Congress, has been a centerpiece of President Obama’s campaign to crack down on wealthy Americans he says have been dodging taxes by hiding their money overseas.  But it has become enormously controversial, empowering foreign banks to turn over overseas  Americans’ private information to foreign governments, who then must turn it over to the Treasury Department.

The lawsuit argues the agreements the Treasury Department reached with foreign countries to gain access to Americans’ banking information violates the Constitution’s Article II, Section 2 that requires two-thirds of U.S. senators present and voting to approve a foreign treaty.
 “This lawsuit speaks volumes about the Obama administration’s lawlessness and disregard for the Constitution,” said Jim Bopp Jr., lead attorney for the plaintiffs who, collectively, have eight separate constitutional claims against the law and its enforcement mechanisms.

Mr.. Bopp noted he had only one Constitutional claim in the landmark Citizens United vs. FEC case, for which he was the original architect.  A total of 1,335 Americans renounced their U.S. citizenship during the first three months of 2015, according to figures released by the IRS.

That suggests U.S. renunciations will hit another new high this year. Last year, 3,415 Americans gave up their citizenship — 15 times more than in 2008.  “Americans overseas are suffering egregious unconstitutional violations of their privacy and are facing draconian fines by the vigorous enforcement of the law by the Obama administration,” said Mr. Bopp. “The vast majority of overseas Americans are law-abiding middle class Americans, but the Obama administration treats them all as tax cheats.”   “We want the federal court to stop Obama’s Internal Revenue Service by immediately issuing a preliminary injunction that will protect Americans overseas until a trial can be held by the court.,” Mr. Bopp said.  Critics emphasize the government overreach that they say the law’s efforts to nail tax cheaters represents.

Following weeks of stock market turmoil, China has confounded expectations that its economic growth would slow further in the second quarter, with gross domestic product rising by 7%.
Analysts had widely predicted that economic growth would dip from 7% in the first quarter to around 6.8% in the second.  However, GDP held steady, officials from China’s National Bureau of Statistics claimed on Wednesday morning. The figure still represents the lowest level of growth since the 2009 global financial crisis but is in line with Beijing’s official target for 2015 of “around 7%”... 

However, there were immediate doubts over the growth figure’s reliability with the announcement sparking renewed debate over the trustworthiness of Beijing’s statistics.

The fact that the figure was exactly in line with the Communist party’s 2015 full-year growth target “raises suspicions,” said Yang. “There is the issue of credibility, certainly.”   China’s premier, Li Keqiang, tried to put a brave face on the recent stock market collapse during a meeting on Friday with economists and business leaders in Beijing.

“China’s economy still boasts remarkable tenacity, potential and flexibility,” Li said, according to state media. “There is little doubt that China’s potential for medium-high growth remains underpinned by strong, long-term fundamentals. The global economic recovery is full of twists and turns. China should push forward its own development with stronger confidence and greater efforts.”
However, Beijing has faced criticism for its handling of the crash. Chinese president Xi Jinping has vowed to reduce Beijing’s role in the economy but as stocks plunged earlier this month the Communist party took drastic measures, including temporarily halting initial public offerings.  ....No-one, even in China, believes this number. Party apparatchiks deliver a number to suit the forecast, to do otherwise would cause Xi to lose face and further erode trust in the crashing stock market. The real number is probably around 5%.

The severe damage caused to the Greek economy by more than two weeks of bank closures and capital controls means the stricken eurozone country will require far more generous debt relief than is currently on offer from its single-currency partners, according to the International Monetary Fund.

A report by the Washington-based Fund leaked to the news agency Reuters shows that Greece’s public debt is likely to peak at 200% of its national income within the next two years, with the risk that the actual outcome could be even worse.The debt sustainability analysis comes on the eve of a crucial vote in Athens when the prime minister, Alexis Tsipras, will be seeking parliamentary approval for the fresh austerity measures demanded by the eurozone in return for a three-year rescue package worth up to €86bn (£61bn).  Putting into question its involvement in the bailout, the IMF report paints a far darker picture of Greece’s public finances than contained in the blueprint released at the end of the marathon eurozone leaders’ summit on Monday.  “The dramatic deterioration in debt sustainability points to the need for debt relief on a scale that would need to go well beyond what has been under consideration to date – and what has been proposed by the ESM,” the IMF said, referring to the European Stability Mechanism bailout fund which will be used to bankroll the Greek bailout plan.  Throughout the Greek crisis, the IMF has consistently urged deeper debt relief but has met resistance from European finance ministers, who have been unwilling to make their taxpayers pay the cost of a write-down.  Tsipras has also insisted that debt relief must form an important part of the package, but the Eurogroup statement on Monday said only that further measures might be taken provided Greece adhered in full to the reforms demanded by its creditors.In the leaked report, the IMF says that Greece’s debts threaten to be unsustainable for decades, and that its financing needs will rise so that they are above the 15% of national income level deemed safe.  The IMF added that European creditors now face the choice of either annual transfers to the Greek budget or “deep upfront haircuts” (cancellation of part of the debt).  IMF sources confirmed that an updated debt sustainability analysis had been prepared by staff and would be discussed by the organisation’s executive board.  Unless the IMF can convince itself that Greece’s debts are sustainable, it would be forbidden by its own rules to put money into a new bailout. The assumption has been that the Fund would provide €16.4bn – around 25% of the total – with the rest coming from the ESM.

The Bundestag has voted in favor of starting negotiations with Greece over a third bailout.

439 lawmakers voted in favor, and 119 opposed the move, with 40 abstentions.  The Board of Governors of the European Stability Mechanism (ESM) approved today a decision to grant, in principle, stability support to Greece in the form of a loan programme. This decision follows the completion of national procedures that involved parliamentary approval in some of the ESM Member States. The basis for the Board of Governors’ approval was the assessment by the institutions and the proposal by ESM Managing Director Klaus Regling.  This in-principle decision paves the way for the institutions to negotiate a Memorandum of Understanding (MoU) detailing the agreed macroeconomic reforms, or policy conditionality, linked to the ESM financial assistance facility. Simultaneously, the ESM Managing Director will prepare a proposal for the loan contract with Greece, the Financial Assistance Facility Agreement (FFA).  Once the MoU is finalised, the Board of Governors must take a further decision, involving national parliaments in some Member States, to approve the MoU as well as the FFA proposal. The European Commission must sign the MoU. Finally, the ESM Board of Directors must adopt the FFA and agree to disburse the first tranche of the loan.  Klaus Regling, ESM Managing Director, said: “We welcome that the Greek government and parliament voted in favour of the reforms with a very broad majority. This has paved the way for today’s decision in principle to start negotiations on a new programme for the benefit of Greece. Let me stress that thanks to reform implementation, Greece had started to grow again in 2014, unemployment had begun to decline, and the country had regained some market access. The ESM has a remaining lending capacity of €455 billion but only a small part of this sum will be needed. The ESM stands ready to provide financial assistance when our Members fully adopt an ESM program.”