MORNING BID EUROPE-A daily note from our Economics/Politics Editors

* A daily view from European Affairs Editor Paul Taylor. The views expressed are his own.

LONDON, June 30(Reuters) - It's doomsday for Greece.

Today's the day Greece defaults on a 1.6 billion euro payment to the International Monetary Fund and its international bailout expires, removing any right to further funding for the state or bank recapitalisation.

With Greek banks closed for the week except for limited pensioner cash, ATM withdrawals capped at 60 euros a day, the stock market closed and the ECB still providing emergency liquidity assistance for the banks, there may not be much immediate panic in Greece.

Global financial markets had a rocky day on Monday, and the confirmation of Greece' default, even if it was largely priced in on Monday, may cause further falls in Europe today.

Most of the last minute agitation by the French, the European Commission and the Germans appears to have been aimed at blame avoidance rather than in any genuine belief that talks could be restarted now that Greek Prime Minister Tsipras has called a referendum to reject the creditors' terms.

A Berlin official used one of those wonderful German compound nouns to describe the motive behind the diplomatic agitation: "Taetigkeitsnachweis" (proof of activity).

However, there does seem to be a concerted effort to do everything possible to encourage the Greeks to vote "Yes" on Sunday despite Tsipras' repeated rejection of their terms.

It remains hard to discern Tsipras' strategy. He has called a short-notice plebiscite with a complex 90-word question full of acronyms and jargon, and with the "No" box placed above the "Yes" box, just in case any electors were in any doubt about which way the government wants them to vote.

Does he seriously believe he can negotiate from a stronger position with the euro zone having rubbished their proposals, got his voters at short notice to reject them, and defaulted in the meantime?

Perhaps he believes that faced with the risk of losing all their taxpayers' money, European governments will be more willing to contemplate taking a haircut on some of the loans to Greece.

Tsipras seeks to have locked himself into rejecting the deal, however Greeks vote. If they support it, he said on television last night, a different government will have to implement the austerity programme. Yet he and Finance Minister Varoufakis keep swearing they want to stay in the euro zone, and remember it's legally impossible to kick them out.

Some dissenting economists believe Greece needs to leave the euro and endure a massive devaluation to revive its economy. If Greece sold anything other than olive oil and holidays, that might conceivably make sense, although it would still cause brutal losses and economic dislocation. But the country's debts are in euros, it is a big net importer, notably of food, and while tourism to Greece would be cheaper, holidaymakers would surely be deterred by the likelihood of strikes, riots and closures.

Greece makes little else that the world wants to buy.

So far the blame game has been quite muted in the rest of Europe, with even centre-left media sympathetic to Greece criticising Tsipras for breaking off the talks and calling for fresh negotiations rather than blank cheques for Athens.

One way or another, there are likely to be further talks after the referendum, from a worse starting point on both sides.

EU partners will do everything they can in the next five days to make it clear to Greeks that the referendum is effectively an "in/out" vote on staying in the euro. Either you stay on our terms, or you exclude yourselves de facto.

Yet in reality, Greece is quite likely to stay even if electors vote "no".

Once again, the ECB is in the awkward, politically sensitive position of having to decide when to pull the plug on the Greek banks. Probably not after the IMF payment is missed, but perhaps after a "No" vote to the bailout deal, if there is one.

Or perhaps only if this drags on without a solution until July 20 and Greece defaults on government bonds held by the ECB itself.

At the latest at that point, it's hard to see how the central bank could go on propping up Greek banks whose collateral includes defaulted Greek government bonds.

Today's dramatic events are not the end of the line, but it's still worth drawing breath and considering the magnitude of what is happening. For the first time in the history of the IMF, an advanced economy is defaulting on the global lender.

After receiving nearly 240 billion euros in two bailouts - the largest international financial rescue ever mounted - the Greek state is bust. A leftist poster on a street corner in Paris last weekend said: "If Greece were a bank, it would already have been saved." Well maybe, but no other euro country has shown the same septic allergy to the harsh medicine of an international rescue. (Editing by Jeremy Gaunt.)