On December 6th, I naively wrote that Greece would require a 4th bailout prior to German elections in the fall due to falling tax revenues in the face of an ongoing depression:
ZeroHedge has pointed out that insolvent Greek banks will necessitate a fourth bailout before then. Bad loans in the Greek banking system are an obscene €55bn. Additionally, the forced bond exchange to bring Greece’s debt down to “sustainable” levels cost the Greek banks €37bn in capital. Then, Greek banks must add €92bn in capital to become solvent, and only €50bn has been allocated for bank recapitalizations.
Add in a €500mm to €1bn in monthly revenue shortfalls for government spending, and you can see that Greece will be asking for another bailout sooner rather than later. I do not believe that the Merkel makes it through elections without the Greek problem rematerializing.