Worker in Athens stands his ground against a riot police attack
Worker in Athens stands his ground against a riot police attack

The British MP Denis McShane has given a serious warning about the situation in Greece.

He said: ‘When I first visited Greece I saw tanks in the streets; if Greece leaves the euro I’m afraid that I will see tanks again guarding the banks’ ATMs.’

He was speaking last Tuesday at a BBC World News-organised discussion in Athens.

At the same discussion, economist Nouriel Roubini, regarded as one of the top analysts in the USA, insisted that Greece should leave the euro and predicted ‘extreme social phenomena’; he emphasised that ‘if the recession is to be continued in Greece, then the tanks will come out’.

The Athens Stock Exchange is nose-diving after last Monday’s Euro-group Greek bailout agreement.

Last Tuesday it dived three per cent and on Wednesday collapsed by 5.7 per cent.

The US Fitch economic rating agency relegated Greek bonds by two notches on Wednesday down from CCC to C status, just above D for default.

The Greek government spokesperson Pantelis Kapsis said that Greece might well force a deal on the private sector. This will lead to an ‘involuntary structural default’ leading the rating agencies to declare Greece bankrupt.

The majority of Greek state bonds are experiencing a ‘haircut’; the figure of 54.5 per cent was mentioned in last Monday’s Euro-group agreement. They are held by the Greek private banks (around 40-50 per cent) and by Greek Pensions Funds (25 per cent).

Under continuous rain, thousands of workers staged a rally last Wednesday evening outside the Vouli (Greek parliament) called by the GSEE (Greek TUC).

Inside, the EC/IMF-installed government of banker Prime Minister Lucas Papademos presented a bill for immediate wage cuts of 22 per cent and pensions’ cuts between 15-25 per cent. Wages would go down to as little as 400 euros a month.