It's kind of like selling goods to consumers with very bad credit and then being surprised when they don't pay.

But before I get into that, we all know Greece owes Germany, the ECB, and the IMF a lot of money.

Last week I explained that if they went the “Grexit” route, 75% of Greece's government debt would've been wiped clean. That's $90 billion to Germany alone and about $250 billion to the rest of the euro zone. It would have hurt, but there's no avoiding pain at this point, and now it's only going to be worse.

But there is another level of debt almost no one is talking about.

In fact, we have a harder time getting good information on it because the EU has increasingly hidden it.

However, this debt gets at the heart of why Germany and some of the strongest opponents to a Grexit were so desperate to keep Greece in the euro zone.

This not-much-talked-about debt are the TARGET2 loans Greece (and other euro zone importers) owes the rest of them.

It's a fancy way of saying “past due accounts receivables.” Another way of saying this: “The check's in the mail.” Or: “We'll pay you when we can.”

Fat chance.

The idea is that when German or other euro zone companies sell goods to Greek companies, the Greek companies hand off their payment obligations to the Greece central bank. That central bank then owes Germany's central bank, which then pays the German companies who sold the goods in the first place.

The problem is that the southern European countries – PIIGS, or Portugal, Italy, Greece, and Spain plus Ireland – import a ton. When Germany sells to Greece, Greece's central banks collects the money, but doesn't pay the German central banks. These are called TARGET2 loans.

They're not really “loans” in the sense that they are involuntary. The German central bank knows that if it pushes too hard for these payments on time, exports will slow or discontinue without such credit extension. It's either extend credit to these subprime borrowers or lose the sales!