GREEK DEFICIT: How Berlin encouraged Papandreou to big-up the 2009 Greek deficit | The Slog.

Somewhere in the midst of these talks, Berlin requested a smaller meeting with the Greeks. At this meeting, three sources (two Greek and one German) allege, the small German delegation made an astonishing observation: the situation would “have to look more desperate” in order to justify a bailout to the other eurozone members. That is to say, only widespread fear of the entire eurozone being damaged would get the member States to pile in with bailout monies.What Berlin was really worried about, of course, was that the Franco-German banking system might collapse if Greece wasn’t saved. And at that stage, little or nothing had been done to make the sector better able to withstand a derivatives wave.

Source: GREEK DEFICIT: How Berlin encouraged Papandreou to big-up the 2009 Greek deficit | The Slog.

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