Looks like the govt is reducing the amount of euro they owe themselves,

But not reducing the liabilities those govt pension funds and other agencies owe others?

Greece to Restructure Debts of Pension Funds, Isotimia Reports

By Marcus Bensasson

January 17 (Bloomberg) — Greece’s Finance Ministry is planning to restructure debts of 30 billion euros ($39.9 billion) held by social security funds and state-run enterprises, Isotima said in a report, without saying where it got the information.

The government will replace existing debts with medium and long-term bonds with lower rates of interest than market rates, the Athens-based weekly newspaper reported yesterday.

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>   On Sun, Jan 16, 2011 at 12:34 PM, qrote:
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Central Bank steps up its cash support to Irish banks financed by institution printing own money

Yes and no:

“A spokesman for the ECB said the Irish Central Bank is itself creating the money it is lending to banks, not borrowing cash from the ECB to fund the payments. The ECB spokesman said the Irish Central Bank can create its own funds if it deems it appropriate, as long as the ECB is notified.”

My understanding is that rather than keep all the member bank accounts themselves, the ECB utilizes the existing member nation Central Banks as their designated agents for transactions purposes.

So the member banks in the euro zone have their clearing accounts with their national banks.

That means funding for the member banks comes via credits to their accounts at their local central bank, and it’s the personnel at those local central banks, like the Irish Central Bank, who enter the actual debits and credits for the member bank accounts.

In the case the ‘money that’s being created’ is describing secured lending to the member banks as per ECB policy and directive, with the Irish Central Bank making the actual debits and credits to the Irish commercial bank accounts on their books.

It’s somewhat like the US where the NY Fed, for example, keeps the books for it’s member banks.