If you've followed European news at all then I'm sure you're aware that EMU-countries and the IMF are lending Greece quite an amount of money (basically meaning that my country for example is borrowing this money while in debt itself and then lending it to Greece...). The justification for this is that if Greece is not helped then the whole euro-area will once again dive into a recession and yaddayaddayadda...

Whether Greece will ever pay back.. At least I am very skeptical about that seeing how $#@!ed up their business and government is. A finnish politician had a great idea that Greece must give Rhodes as security for the loan, I've got nothing against that

But behind this farce seems to be, surprise surprise, the American investment-banks. Here's a roughly translated finnish article on this.

Banks helped Greece to cheat
Arto Huovinen

Especially in Germany people have paid attention to how the infamous American bankgiants are making big profits by helping Greece in it's continuing statisticshoax.

The German Der Spiegel and the american The New York Times published in February articles on how Wall Street's big investmentbanks, like Goldman Sachs and JPMorgan Chase, have given their contributions to at least Greece's and Italy's "creative bookkeeping".

Goldman Sachs had a significant role in getting Greece into Europe's monetaryunion EMUc and along that the euro currency when it began in 2002. The bank engineered a complicated arrangement by which Greece was able to hide billions of their debt from other eurocountries.

In reality Greece wasn't even close to fulfilling the limits pointed out in the Maastricht-deal. These limits say that public debt can't exceed 60% of GDP, and the budget deficit can't exceed 3% of GDP.

Debt masked as business

In the operation organized by Goldman Sachs in 2001 the weapon used was derivative-instruments (?), which you can use to defend yourself against fluctuation in interest rates or currency rates.

In Greece's case, a notable amount of debt taken as dollars and yens was exchanged into euros and then back to dollars and yens. This is completely normal and legal financing.

The gray area was, that in the exchanges completely false currencyrates were used. Greece officially took 10 billion dollars of debt, but on top of that one billion more which didn't appear as debt in statistics.

To Goldman Sachs the organizing was very profitable. They were rewarded with 300 million euros. This was to be paid with upcoming income of the Greece government.

So the deal named after Greece's wind-God "Aeolos" promised Greece's airport landing-fees to investmentbanks until the year 2019. The other part, Ariadne, promised the income of future government lotteries to the banks.

The only winner is the bank

The genius of this organizing is, that nothing illegal happened. Government borrowing and statistics -rules are ambiguous, also in the EMU.

Still external factions are mislead and the country resorting to cheating can keep on living over their funds.

The only true winner is the bank. For the country these deals are in the long run usually unprofitable.

Goldman Sachs sold these contracts to a big Greek merchant bank. The American bank although has been always ready for new deals, according to the NY Times.

For example in last November a Goldman Sachs delegation came into Athens to propose an arrangement to cover up the debt in Greece's health care. The Greek government didn't take this though.

Both big parties in the game.

Derivative-arrangements were not the only way to cover up the truth. Sometimes direct action was taken; for example one year the defense-expenses were simply not documented.

When Greece stepped into the euro in 2002, the budget deficit according to the official statistics fulfilled the criteria, it was only 1,2% of GDP. After an inspection in autumn of 2004 by EU's statisticsunit Eurostat, the figure was fixed to 3,7%. Nowadays it's estimated to have been 5,2%.

Either of Greece's biggest parties can't claim that only the other one was cheating. Years 1996-2004 the socialist Pasok was in power. Years 2004-2009 was the conservative Nea Demokratia. Now the socialist Pasok is once again in power.

Greece isn't the only one having "creative bookkeeping". It is known that at least Italy was able to "fix" their budget in 1996 with a similar derivative-arrangement. Their partner was another big American investmentbank JPMorgan Chase.
So, what's your take on this farce?