"In 2013 Greek taxpayers borrowed from the
rest of Europe’s taxpayers €41 billion to pump into the Greek banks. This is well known. What is not known is that, also in 2013/4, the Greek banks received an
additional, well hidden, €41 billion bailout loan from Greek and European
citizens. This bailout was never authorised
by any Parliament or even discussed in public anywhere in Europe.
This is how it worked: Bank X would lend money to… itself. It would do this by issuing
a bond which it did not intend to sell. So, why issue such a phantom
bond? Why write an IOU and give it to one’s self? The answer is: In order to
hand this phantom bond over to the European Central Bank as collateral in
exchange for a cash loan. Normally, of course, the ECB would never
accept such a phantom bond as collateral. Accepting it would have
been to accept a loan it gave to Bank X as collateral for the said loan. It
would have been an assault on the meaning of collateral and a gross violation of
the ECB’s rulebook. So, bank X, knowing this, took its phantom bond
first to the Greek government and had it guarantee it. With the government’s
guarantee stamped on it, the ECB then accepted Bank X’s phantom bond and handed
over the cash. Why? Because the Greek taxpayer had, in the meantime, unknowingly provided
the collateral for Bank X’s loan."
