Parties on both sides still talk as if a deal over Greece is possible, but how realistic is that? And yesterday, the ECB voted to continue ELA, but did so with an amount less than Greece requested.

Last Minute Phone Talks

This morning, Reuters reported EU’s Juncker, Greek PM Tspiras Hold Telephone Talks.

European Commission President Jean-Claude Juncker spoke to Greek Prime Minister Alexis Tsipras on Saturday and will speak again on Sunday to seek a solution to Athens’ debt crisis, an EU official said on condition of anonymity.

Over the weekend, senior officials have remained in close contact ahead of a meeting of finance ministers and euro zone leaders scheduled for Monday, the official said.

Tomorrow, eurozone officials hold an emergency meeting to discuss Greece. However, France and Germany Insist Greece Needs to Table Offer Today.

France and Germany have told Greece it must have an agreement on economic reform measures with the trio of bailout monitors finalised and delivered before a crucial leaders’ summit between Athens and its creditors on Monday.

With the Greek cabinet meeting on Sunday to consider compromise proposals, François Hollande and Angela Merkel both telephoned Alexis Tsipras, the prime minister, to remind him that he needed a “staff level” agreement with the European Commission, IMF and ECB ahead of the summit.

If a deal is reached, the two leaders said the summit could start talking about the Greek debt and a third bailout. France is open to discussing debt relief and restructuring, Mr Hollande told Mr Tsipras, whose radical leftwing government won office in January setting Greece on a collision course with its creditors.

The Greek cabinet was summoned to a meeting at Mr Tsipras’ Maximos Mansion residence on Sunday morning for a last-ditch meeting to hash out the government’s strategy.

Ministers are expected to discuss how Mr Tsipras can bridge his two seemingly intractable electoral mandates: to end austerity and block further cuts in spending while also satisfying creditors’ demands for reform to keep Greece in the eurozone.

Yanis Varoufakis, Greece’s finance minister, writing in German daily Frankfurter Allgemeine Zeitung, has said German chancellor Angela Merkel faces “a stark choice” ahead of the crucial summit of European leaders in Brussels on Monday.

Ms Merkel could enter into “an honourable agreement with a government that opposes bailouts” and wants “a negotiated solution that ends the Greek crisis once and for all”. The second option was to “heed the sirens” from her government, which he said were “encouraging her to jettison the only Greek government that is principled and which can carry the Greek people along the path of genuine reform.”

Mr Varoufakis said the Greek government would come to Brussels on Monday willing to compromise. but it would only compromise as long as the Syriza-led government was not asked to take on new loans “under conditions that offer little hope that Greece can pay back its debts”.

“The choice, I am very much afraid, is hers,” he said.

In a sign of the growing anxiety in Greece, savers withdrew more than €1.6bn in deposits on Friday, according to two banking sources, the largest withdrawal in one day since Greece’s left-wing government took office in January. More than €6bn have left the system this week, and bankers fear the withdrawals could speed up when the banks reopen on Monday.

Syriza supporters will rally in front of Parliament on Sunday evening to urge the government not to give in to creditors’ demands.

By stating willingness to discuss debt relief and restructuring, while Greece offered little, it should be clear which side is willing to bend more. However, Merkel’s hands may be politically tied. A majority of Germans now favor Greece leaving the eurozone.

Those still expecting Merkel to cave may be in for shock therapy tomorrow.

It is Yanis Varoufakis, Greece’s finance minister, who signaled goodbye intentions stating Greece would not take on more debt, with both France and Germany talking about a third bailout.

This dance has gone on far too long already. A goodbye kiss is long overdue.

Mike “Mish” Shedlock