Coles Notes on The Situation in Greece

In response to a question, I’ve put together a quick recap on Greece.

• Greece has enough cash on hand to get to mid-October without any international aid.
• They could probably squeeze out another month or so afterwards by deferring some payments or selling assets.
• The next aid tranche (8 billion euros) is scheduled for release in the last week of Sept.
• If received, this would clear make Greece solvent at least until late-December when the next round of aid is due.
• A report yesterday citing IMF officials said the Sept. tranche is likely to be disbursed because…
• A new property levy to raise 2 billion euros will be placed on electricity bills so collection should be relatively quick and smooth.
• A German official on Tuesday said the Finnish collateral issue is likely to be resolved.

Expect to see more brinksmanship but in the many, many similar episodes to Greece, they always come through with the money. It will be domestic politics on an unanticipated crisis that pushes Greece over the edge, not the troika.