The latest in the great Eurozone Crisis Saga.
And what is a haircut, you may ask?
"Gary Jenkins, head of fixed income at Evolution securities, outlined what a haircut would mean for Greek bond holders. ‘It involves a "voluntary" bond exchange with a nominal discount of 50% on notional debt held by private sector holders with €30 billion provided by the eurozone member states for credit enhancements, and it aims to reduce Greek debt to 120% by the end of the decade.’" Citywire.
Sounds like more of the usual paper-shuffling and prestidigitation to me.
How about recapitalisation?
"To what extent taxpayers have to plug the gap – and whether state aid rules then kick in – could depend on the timescale banks are given to raise the capital. Huertas told Newsnight that the EFSF would be there as a "last resort". He said: "The plan is for banks to access public markets first," before turning to nation states for support – and then the EFSF." Graun.
Yeah, yeah, yeah ….
Maybe commenter Moggoid sums it up better, over at the Slog: “I stumbled upon this article – tying to find out what “recapitalisation of banks” actually means. And I gather it means that somewhere large amounts of money are found and then just given to the bank – Is that right?”
The banks love the deal, which should make anyone who’s not a banker suspicious. The much-courted and fawned over “Markets”* love the deal - but then they loved the glistening 2000s bubble that preceded the 2008 Crash, didn’t they. So what do they know.
*The "Markets" - basically a bunch of saddoes with nothing better to do than play Crackberry with large numbers and screw the rest of us.