Richard North, 25/09/2012  

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After a brief hiatus, Speigel is saying that we are back to where we started with Greece. This is after the €11.5 billion deficit had first expanded to some €14 billion and, over the weekend, has been claimed to top €20 billion.

It was, of course, in October 2009 that the Greek deficit was suddenly found to be much greater than originally forecast, and now we are going through exactly the same process.

Yet, although the Greek deficit is nearly twice what it originally forecast, there is no chance that it can impose enough spending cuts to cover the gap. And, despite that, it still needs the €31-billion tranche of the bailout funds to avoid a plunge into uncontrolled bankruptcy.

Closing the gap, however, was a condition on which the release of new funds was based., leaving the eurozone countries to decide whether they dip their hands in their pockets again, or finally dump Greece.

So it is that rumours are intensifying to the effect that Greece will be given more time to implement its cuts. But even that can't be assured. As it stands, there is no agreement on how much the Greek deficit actually is, or when a definitive figure will be available. Even the Troika report has been further delayed.

The chances are, therefore, that a decision will be required on releasing funds to Greece before the extent of indebtedness is known, adding to the growing unreality of this non-crisis. If there were any sense here, the money men would be heading for the hills.

Instead, there does seem to be a determination not to have a crisis, adding fuel to the other set of rumours, that the lid is being kept on the mess until after the US presidential elections. If there is any truth in that, we have a crisis on hold – the fun has yet to come.

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