Goldman Sachs helped the Greek government to mask the true extent of its deficit with the help of a derivatives deal that legally circumvented the EU Maastricht deficit rules.
At some point the so-called cross currency swaps will mature, and swell the country’s already bloated deficit.
Creative accounting took priority when it came to totting up government debt.Since 1999, the Maastricht rules threaten to slap hefty fines on euro member countries that exceed the budget deficit limit of three percent of gross domestic product. Total government debt mustn’t exceed 60 percent.
The Greeks have never managed to stick to the 60 percent debt limit, and they only adhered to the three percent deficit ceiling with the help of blatant balance sheet cosmetics. One time, gigantic military expenditures were left out, and another time billions in hospital debt. After recalculating the figures, the experts at Eurostat consistently came up with the same results: In truth, the deficit each year has been far greater than the three percent limit. In 2009, it exploded to over 12 percent.
Source: Der Spiegel
American Investment Baking has a funny way of making money. They first rob their clients, and than make Washington force all the taxpayers to pay the final bill.
The Lawlessness of American Capitalism can best be expressed by the money-makers in Goldman Sachs.
The story about how criminal banker in American took 100 million USD from Greece for hiding its actual debt figures, is now a month old.
But it is still a brilliant story for all who like the hear the truth about the criminals who govern the Wall Street.
Jesus correctly said that love of money is the root of all kinds of evil. All kinds.
Todays news makes The Wall Street into the financial version of “The Muppet show”.
Greg Smith, an executive at Goldman Sachs resigned, calling the bankers evil. He claims Goldman Sach’s calls its own clients “muppets”. The bankers only love their own bonus deals, and do not care if the client will win or loose playing their games. The commission for their crimes will be paid anyhow.
It normally take a year or so before the client understand that He do not understand the “financial instruments” he one year back was convinced by Goldman Sachs, he had to purchase.
Written by Ivar