Last month, Greek government said that they have enough money to last through mid-October at which point the government would have no cash to cover payment obligations.
Suddenly, Greek Finance Minister is saying that the government can last through mid-November.
“Until the middle of November we will have no problem,” Finance Minister Venizelos told a press conference.
The press obviously wanted to know where is the extra money coming from so that the government can live through another month.
”Venizelos said there had never been an official deadline,” writes Greek newspaper Kathimerini.
The question here is whether what Venizelos is saying has any credibility?
That could be debated from both ends but that there are some major holes in Venizelos’ statements attest his insistence that the new loan tranche does not matter at all but what matters is that Greece convinces markets that it is fiscally sound.
“The main issue is not the release of the sixth tranche but convincing the markets that we have all reached a viable solution,” Venizelos told reporters.
It is incredible, however, that a Finance Minister, whose country owes $400 billion, could believe that bonds of his country, considered junk with astronomical yields, would suddenly rally if he presented a good plan on how to pay off $8 billion… and all of this to be achieved without any new measures.
It is more likely that this is Greece’s last ditch jawboning as the EU finance ministers seek to quickly find a recapitalization method for the Eurobanks and perhaps start injecting it before Greece announces a default.