Talks Over $8 Billion In Bailout Funds Stalled After Greeks Miss Reform Goals

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Greek finance minister Evangelos Venizelos

Image: AP

Discussions between Greece and officials from the "troika" of the European Union, European Central Bank, and International Monetary Fund will pause for 10 days so that Greece can perform a technical study of its economic data.

This pause follows revelations yesterday that Greece will miss its deficit-cutting and privatization goals.

In a press conference this morning, Greek Finance Minister Evangelos Venizelos told reporters, "Yesterday night it was decided to conclude the first cycle of talks and a second cycle will begin in about 10 days on September 14," per a Reuters report.

He also confirmed that expectations of Greece's contraction had come in worse than expected at a number "very close" to 5%.

According to the AP, he insisted that this break had been "planned," and that austerity measures beyond those already approved by the Parliament would not be adopted.

Nonetheless, controversy will pervade this development, particularly on the heels of yesterday's announcement. Fail ling to meet announced goals could jeopardize $11 billion in bailout funds from the troika.

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Robert Shiller Talks About The Substantial Downside For Equities

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Robert Shiller joined Consuelo Mack on WealthTrack this past weekend to discuss the ongoing problems in the economy. Shiller of course is notable for having predicted both the Nasdaq bubble and the housing bubble. He remains one of the few academics who understands how markets and the broader economy relate to one another.

In this interview Shiller explains why he believes the psyche of the investing class and the general economic participants are being negatively impacted by the economic malaise. He refers to it as a positive feedback loop that is very difficult to reverse. In equities, Shiller makes some rather alarming comments. He says the current volatility is not healthy and could very well be preceding a “substantial” decline in equities. He makes no firm predictions, but he maintains that the current fragile environment could result in major downside.

He explains why equities still appear expensive, why housing is likely to remain under pressure, why the general economy is likely to suffer a continuing malaise and why TIPS are his favorite investment currently:

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Biden Says Debt Super Committee Faces “Very, Very Difficult” Odds, As Talks Begin

The "Super Committee" of congressional lawmakers tasked with finding $1.5 trillion in savings from the federal deficit has begun informal conference calls and staff meetings according to one member, as Vice President Joe Biden expressed skepticism that the group will be successful.

Rep. Frank Upton (R-MI), selected selected by Speaker of the House John Boehner to serve on the committee, told WNDU in South Bend, IN, that members have spoken by conference call to discuss their plans for the committee.

"We've had a good number of discussions already. Our staffs are working together, and there's a lot of documentation that we can look at already," he said. "We really do feel like folks across the country are pulling for us to get it together. Now is our chance to focus on a long term result."

Meanwhile, while traveling to Japan, Vice President Joe Biden said lawmakers on the committee face “very, very difficult” odds, but maintained that the 12-member panel must strive to reach the required cuts by the November 23rd deadline.

They have “a shot of getting a deal that would be viewed by Wall Street, be viewed by everyone, be viewed by the international community as a significant alteration of a trajectory of long-term debt," he was quoted as saying by Bloomberg. 

If the deal is not reached by the deadline, significant cuts to both Medicare and defense spending would take effect — cuts Secretary of Defense Leon Panetta called "dangerous" to national security.

"We still may end up with the trigger being pulled,” Biden added aboard Air Force Two.

According to administration officials, President Barack Obama is preparing to push the "Super Committee" to take up job creation legislation as part of its mandate to cut the federal deficit.

The committee was created as part of the deal to raise the debt ceiling, and its recommendations must be voted on by up-or-down vote in both chambers of Congress by December 23rd.

[h/ts POLITICO, The Hill]

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