Greece warned of public finances collapse

[dkf]

Greece's public finances could collapse as early as next month, leaving salaries and pensions unpaid unless a stable government emerges from the June 17 election, according to Lucas Papademos, the technocrat prime minister who left office after this month's inconclusive vote.

Mr Papademos warned that conditions were deteriorating faster than expected with cash flow likely to turn negative in early June amid a sharp fall in tax revenues and a loosening of spending controls during two back-to-back election campaigns.

Mounting anxiety that Greece is headed for further political instability and a possible exit from the euro has prompted many Greeks to postpone making tax payments, and has also accelerated outflows of deposits from local banks.

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The looming cash crunch was revealed on Sunday in an eight-point document published by the Greek newspaper To Vima. A senior government official confirmed its accuracy, adding that Mr Papademos gave the document to President Karolos Papoulias, who discussed it with political party leaders as part of a failed attempt to form a national unity government.

http://edition.cnn.com/2012/05/27/business/greece-public-finances-warning/index.html

[dipsydoodle]

1. Greek pro-bailout conservatives regain lead - polls

(Reuters) - Greece's conservatives have regained an opinion poll lead that would allow the formation of a pro-bailout government committed to keeping the country in the euro zone, a batch of new surveys showed on Saturday.

Greece was forced to call repeat elections for June 17 after a May 6 vote left parliament divided evenly between groups of parties that support and oppose the austerity conditions attached to a 130 billion euro bailout agreed with the European Union and International Monetary Fund in March.

Polls up to Saturday had showed pro- and anti-bailout parties running neck-and-neck ahead of the vote which could determine the country's future in the single currency.

Five polls published in the weekend press showed the conservative New Democracy party, which supports the bailout, with a lead of between 0.5 and 5.7 points over the anti-bailout leftist SYRIZA party - though analysts said the race was still too close to call.

http://uk.reuters.com/article/2012/05/28/uk-greece-election-poll-idUKBRE84R04820120528

SYRIZA talk of ditching the country's bailout deal looks to have spooked their own population who now may be aware that if the deal isn't followed through there may be no more funds released to them. Where that to happen then yes their public finances would collapse.