Germany says Nein! to Greece's extension plan

Germany has turned down Greece's application to extend its loan agreement and renegotiate the terms of its bailout, spurring the very real threat of Athens running out of money in the coming weeks, says CNBC.

The Berlin authorities Thursday said Greece's application for a six-month extension of its loan and a renegotiation of some its terms was "no substantial solution."

In a statement German finance ministry spokesman Martin Jaeger said,

Earlier today, Greece had formally requested to prolong its "master financial assistance facility agreement."

In the proposal the left-wing Syriza Party had offered a series of concessions to the previous hardline stance that it would unilaterally eliminate the austerity measures imposed as part of the country's 240 billion euro ($270 billion) bailout.

However, the Greek proposal Thursday had pledged to work with the European Union and the International Monetary Fund in reworking the terms of the bailout and to not make any unilateral decisions when it came to the terms of the austerity package.

The Eurogroup of finance ministers from the 19 countries that use the single currency is due to meet on Friday to discuss the Greek plan.

At the same time, facing the prospect of Greece's banks running out of cash, the country has been allowed more provisions via a Emergency Liquidity Assistance (ELA) from the European Central Bank. This differs from its main bailout program and doesn't include the tough austerity policies which Greece policymakers are trying to negotiate over.

Moreover, Greece would stop importing agricultural products from other euro zone countries if it was using the drachma, as they would be more expensive, Sinn said.