© Theglobalpanorama
The week after the leftwing Syriza candidate Alexis Tsipras was sworn in as prime minister, the ECB announced that it would no longer accept Greek government bonds and government-guaranteed debts as collateral for central bank loans to Greek banks. The banks were reduced to getting their central bank liquidity through "Emergency Liquidity Assistance" (ELA), which is at high interest rates and can also be terminated by the ECB at will.
In an interview reported in the German magazine Der Spiegel on March 6th, Alexis Tsipras said that the ECB was "holding a noose around Greece's neck." If the ECB continued its hardball tactics, he warned, "it will be back to the thriller we saw before February" (referring to the market turmoil accompanying negotiations before a four-month bailout extension was finally agreed to).
The noose around Greece's neck is this: the ECB will not accept Greek bonds as collateral for the central bank liquidity all banks need, until the new Syriza government accepts the very stringent austerity program imposed by the troika (the EU Commission, ECB and IMF). That means selling off public assets (including ports, airports, electric and petroleum companies), slashing salaries and pensions, drastically increasing taxes and dismantling social services, while creating special funds to save the banking system.
These are the mafia-like extortion tactics by which entire economies are yoked into paying off debts to foreign banks - debts that must be paid with the labor, assets and patrimony of people who had nothing to do with incurring them.
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