– Greek GDP Plunges To Year 2000 Levels (ZeroHedge, June 8, 2013):
That things in Greece are hopeless and getting worse is an understatement. With unemployment levels off the charts, the pension and retirement systems effectively gone and every able-bodied individual (what little remains of them) moving to the shadow economy which now accounts for 24% of GDP, there are few incentives for people to remain on payrolls, pay taxes and otherwise grow the economy via conventional channels. As a result, instead of an improvement in the economy despite all Greek foreign debt now having been forgiven courtesy of its recent conversion to perpetual Zero Coupons, not even during the depths of the recent economic collapse in late 2011 and early 2012 has the economic collapse been as bad. Kathimerini reports that figures released by ELSTAT on Friday showed GDP at 37.7 billion euros in the period from January to March 2013 – the lowest quarterly GDP since 2000.
Remember how everyone said Q1 2012 is the bottom and there was only upside from there? They lied.
ELSTAT recorded an 8.3 percent drop in consumption in the first quarter from the same period in 2012, with private consumption falling 8.7 percent and state consumption sliding 7 percent. Total consumption declined from 38.5 billion euros in January-March 2012 to 35.3 billion euros in the same period this year.
Investment contracted by 11.4 percent year-on-year, amounting to 5.1 billion euros in Q1 this year against 5.7 billion euros last year. Notably, in the last quarter of 2012 investment came to 5.9 billion euros.
Imports decreased 7.8 percent in the first quarter of the year, dropping to 11.2 billion euros from 12.1 billion in the same quarter in 2012. Exports declined by 2.6 percent on an annual basis: They shrank from 8.6 billion euros in Q1 of last year to 8.4 billion this year.
Naturally, this means that Greece will be in non-compliance with the Troika terms once again, and yet another bailout of Greece is imminent.
For this year, the memorandum signed by Athens and its international creditors provides for an economic contraction of 4.2 percent, while the Finance Ministry expects it to be 4.5 percent and a recent report by the International Monetary Fund puts the figure at 4.9 percent.
But while until now the peace in the tormented nation has been preserved courtesy of that perpetual Bismarckian fallback dangling carrot, the welfare state and the threat of yanked pensions, soon there will be no such “opportunity cost” to revolution left.
Separately, the average monthly pension in Greece has dropped below 700 euros per month as a result of the various cuts imposed over the last few years.
Using data from the recently introduced Helios system for the monitoring and payment of pensions, it appears that the state pays over 4.4 million pensions, most through the Social Security Foundation (IKA), and the average pension amounts to 694.56 euros per month.
In total the state will pay 2.3 billion euros for main and auxiliary pensions this month.
Labor Minister Yiannis Vroutsis said on Friday that the new system “is for the first time shedding some light on the dark and gray areas of the social security system, securing absolute transparency.” This became possible after identifying the pensioners of all 93 social security funds and pension sections and confirming analytical data, and after the completion of a census of all pensioners.
Schauble warned two weeks ago that when the pension system is tapped dry, what follows next, is revolution. He was right.
Finally, for those who missed it, here is the photo study documenting the Greek slide into the “fourth world.“
42-year-old Alexandros, from Serres in northern Greece, sits in the abandoned car he lives in, at the port of Piareus near Athens April 10, 2013. Alexandros owned a plant shop in Athens until 2010, when it was forced to close, he became homeless soon after.
Stephanos became homeless in late 2012 when the clothes shop, where he had worked for over a decade, closed down and he had no income to pay for his flat. He now lives next to a church in central Athens and eats in soup kitchens. Stephanos smokes a cigarette as he sits on a rug in central Athens May 16, 2013.
36-year-old unemployed clerk Michael sits in the sun near a bridge in central Athens May 24, 2013. Michael worked as a hotel clerk for over fifteen years but when the hotel closed he was unable to find work and in late 2011 became homeless, two months later he was diagnosed with lymph node and thyroid cancer. He now lives outside a church.
51-year-old Romanian truck driver Adrian, who lost his job in 2010 when the lorry company he was working for closed down, sits with his head in his hands in central Athens January 18, 2013. Adrian survives by collecting scrap and lives in an abandoned warehouse in Athens central vegetable market.
50-year-old Giorgos sits with his belongings under a bridge, where he lives with a group of other homeless people, in central Athens May 25, 2013. Giorgos was forced to close down the billiard hall he owned in 2006, and spent time in prison for not paying his social security debts.
Michael, a 36-year-old unemployed man, poses by an abandoned open-air cinema in central Athens February 8, 2013. Michael worked as a hotel clerk for over fifteen years but when the hotel closed he was unable to find work and in late 2011 became homeless. Two months later he was diagnosed with lymph node and thyroid cancer. He now lives outside a church.
Marialena, a former drug addict who is on a methadone rehabilitation program, pushes away her boyfriend Dimitrios who is trying to clean up her self-inflicted wounds, under a bridge in central Athens May 15, 2013.
42-year-old Marialena, a homeless AIDS sufferer and former drug addict who is on a methadone rehabilitation program, drinks coffee after waking up next to her boyfriend Dimitrios in central Athens May 26, 2013. Dimitrios, 51, was a dancer in a famous Greek folk dancing troupe until he lost his job three years ago and became homeless.