Economic Collapse: Greeks Hoarding Hard Assets to Preserve Savings

Economic CollapseGreeks are rushing to buy hard assets—from ovens, to refrigerators, and dishwashers—any hard assets that can hold their value to protect their savings, according to a recent report in The New York Times. (Source: Greeks Spend in Droves, Afraid of Losing Savings to a Bailout, July 9, 2015.)

Greek banks have been shut down since June 29th, and are expected to remain closed until Friday. The government-imposed capital control of how much each citizen is allowed to withdraw remains at a maximum of 60 euros (roughly USD$66.00) per day.

Although Greece’s officials and its creditors have returned to negotiations, Greeks fear that consequences of being kicked out of the eurozone will be severe.

As Greeks are struggling with growing fear along with banks losing their credibility, people are being pushed to spend their money on unnecessary goods rather than put it in banks. As a result, it is believed that banks are out of cash.

People have become furious; many of them are walking the city in search of ATMs that have not been emptied of cash. Others desperately try to spread their money into different accounts, lowering their money in each bank.

Creditors demand the request for more aid to follow up severe pension cuts, tax increases, and other austerity measures.

Greek authorities said lawmakers would be asked to authorize the leftist government to negotiate a list of so-called “prior actions” it must take before aid funds are provided for banks. The announcement just came out after Prime Minister Alexis Tsipras sent an economic reform proposal to Europe ahead of the summit on Sunday about a possible bailout.

Whether or not European leaders accept the application for more emergency loans at a crisis summit on Sunday, Greeks will continue to witness tough circumstances in their banking sector.

Also Read: Marc Faber: Greece Could Spark an Economic Collapse in 2015