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Tue Aug 11, 2015, 06:41 PM

Vindicated, while Lagarde emerges a loser? – David Marsh in MarketWatch, Yanis Varoufakis

Vindicated, while Lagarde emerges a loser? – David Marsh in MarketWatch

Posted on August 4, 2015 by yanisv

In his Monday column on MarketWatch David Marsh entitled his opinion piece: “Varoufakis vidicated, while Lagarde emerges as a loser”. Of course the point is not whether I have, or have not, been vindicated. The crucial issue concerns the viability, or otherwise, of the latest Greek deal. From day 1 I have been arguing that Ms Christine Lagarde has an interest in a negotiating impasse (between Greece and its creditors) so that she does not have to confess to the simple fact that the IMF’s staff will rebel if she signs another unsustainable loan agreement with a country whose debt is as unpayable as they come. For David’s analysis, read on…

Something is going badly wrong in relations between Christine Lagarde, the International Monetary Fund’s managing director, and the staff of the institution. Three times this month, in politically fraught negotiations over a Greek debt package, the IMF staff has disavowed its management over providing more loans to Greece as part of the third bailout deal of €82 billion to €86 billion that euro leaders stated they sealed on July 13.

As Oscar Wilde might have said, to show one such contradiction might be a misfortune, two appears like carelessness, while three looks downright hapless.

The fissures, as well as reinforcing uncertainty over the Greek imbroglio, cast doubt on Lagarde’s utility in attending European debt meetings, where she appeared to endorse decisions later rejected in Washington. The bizarre nature of IMF divisions may influence a top-level government decision about whether to renew Lagarde’s five-year term that ends in July 2016.

NOTE: Varoufakis includes transcript of
Telephone conversation between Yanis Varoufakis, Norman Lamont and David Marsh 16 July 2015


Just wanted to add that this is must read, if you have been following this situation as I have with much hope, it is absolutely revealing and offers perspective like nothing else. It makes me respect the man, Yanis Varoufakis, for the champion and man born for this time that he is, far more than I already do.

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