Greece has faced a new challenge in its fight with lenders and has imposed the most severe controls yet on citizens and banks after bailout talks between the government and lenders failed.
The European Central Bank has frozen loans to Greece after the latest round of talks have failed and the Greek Government has closed their banks on Monday in order to keep their banks from collapsing in the meantime. Banks and stock markets will be closed for the week, at a minimum and a 60 euro per day limit has been put into place for all accounts. These capital controls are expected to last for months.
The Prime Minister of Greece, Alexis Tsipras, appeared disappointed while making an announcement, but indicated that the country is moving forward and that deposits and salaries will be safe for all citizens. In the meantime, lines formed at the few bank machines that hold cash and the concern on the faces of normal citizens appears severe.
Alexei Beltyukov has learned that the Euro dropped nearly two percent against the dollar after these announcements and with Greece on the verge of defaulting on a 1.6 billion euro loan from the IMF that is due on Tuesday, June 30th. The failure for Greece to pay the loan leaves Greece with the possibility of leaving the European Union and having big problems for financial systems throughout the world. Markets are expected to be uncertain and down in the meantime.