On the eve of the second European Summit that will discuss significant haircuts on Greek debt, the citizens of the debt later country are lining up to grab their money.
Greek banks hold a significant amount of Greek debt and they have already experienced a slow bank run. The evidence seen now is not only in the numbers, but also in queues.
“I come here to immediately pick up my pension â‚¬ 300. Who knows what else happened today. My money is safe only when it is at home” said Pensioners Evagelos Dimitros age 73.
The head of an Athens bank branch told BILD: “More and more Greeks who still have some money come to get it from the bank. In my office there are a total of 5,000 customers, 2,500 of which either have their money transferred abroad or hoard it at home. If this continues, there will soon be no more money.”
This joins a previous report from Bild, a German newspaper, about Greece’s rich moving around 200 billion euros from their accounts in Greece to Swiss banks.
Perhaps the bank recapitalization program of around 100 billion euros discussed in Brussels is already insufficient given these moves.
The euro is still trading high on hopes for a good agreement in Brussels, but reality looks different.
The leaders still haven’t agreed on how to lever up the EFSF, the size of the EFSF, the size of the Greek haircut, that needs to be “voluntary” by the banks. Perhaps the summit will end with smiles, but without numbers…
Update December 7, 2011: Greek Bank Run Intensifies – Exacerbates Greece’s Misery