European Economy

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Greek polling backs “no” vote

Breaking from Reuters: 01-Jul-2015 12:25:33 PM – GREEK BAILOUT REFERENDUM OPINION POLL (RESPONSES BEFORE BANK CLOSURE) – YES 30 PCT, NO 57 PCT, DON’T KNOW 13 PCT 01-Jul-2015 12:25:33 PM – GREEK BAILOUT REFERENDUM OPINION POLL (RESPONSES AFTER BANK CLOSURE) – YES 37 PCT, NO 46 PCT, DON’T KNOW 17 PCT Grexit!

3

Greece defaults, sorta (updated)

From RT: International Monetary Fund has confirmed it didn’t receive €1.5 billion from Athens that were due by the end of June 30, Brussels time. Greece becomes the first developed country to default on its international obligations. IMF spokesman Gerry Rice said in a statement that Greece had asked for a repayment extension earlier on

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It’s all good in Greece!

All day I’ve been reading feel good pieces about Greece. At Dad’s Army first Alan Kohler and then old man Gotti, at Fairfax it’s Phil Baker,  The Pascometer and even Chris Joye is into it this afternoon: If Greece votes to accept the troika’s deal there will likely be a prompt settlement given the collateral damage

8

Grexit is upon us

Greece is set to default on its IMF loan: And from Yanis’ own blog The Eurogroup Meeting of 27th June 2015 will not go down as a proud moment in Europe’s history. Ministers turned down the Greek government’s request that the Greek people should be granted a single week during which to deliver a Yes or No answer

21

Greece at the brink

Courtesy of FTAlphaville comes more views on Greece. Beat Siegenthaler of UBS: According to media reports the ECB has issued a statement saying that ELA would be kept at current levels as of last Friday. This means that Greek banks may not have sufficient cash to open tomorrow Monday as normal. As a result, there

17

Greece blinks

I’ve been waiting for some clarity after the winding up of the Greek Eurogroup emergency meeting before posting and it appears we the following from AP: Greece has accepted the principle of extending its current bailout programmewhich expires at the end of the month so as to keep it afloat while a long-term debt solution

5

Goldman on Greek scenarios

From Goldman Sachs: Our central case that a deal will come only after (or thanks to) the introduction of capital controls, a technical default on the IMF and issuance of IOUs/and a further build-up of arreas. The logic is that it is only when the cash constraint is fully binding and associated economic and financial

21

Greece to see return of the Colonels?

by Chris Becker Talk of Grexit seems to be turning into reality as the days and hours go on towards the June 30 deadline. One of the major reforms enacted by Athens was to turn the large deficit into a surplus (admittedly, a surplus sans interest payments), but interestingly one area not touched in the

12

Greece reaches the end game

by Chris Becker For almost five years, MB has been calling for an inevitable default in Greece, not borne out of bearishness but the realpolitik of the situation that was at hand and has now unfolded. Delusional Economics wrote this earlier in the year as the new Syriza government was installed: Nearly 4 years ago I

0

Another Greek deadline upon us

From BofAML: The European proposal is asking three times more fiscal measures than what the former Greek government was willing to accept, despite a much lower primary surplus target. The Greek proposal is not specific enough on reforms, while insists on pre-election promises that we believe are unacceptable to the other side—reversing labor market reforms

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Weekend Links May 23-24, 2015

China A cautionary tale from the muddy waters of Chinese business – FT.com Weak Chinese Demand Is Pummeling Mining Stocks Everywhere, Except in China – Bloomberg China pushing ‘build now, pay later’ model to emerging world – Bruegel Development Finance with Chinese Characteristics? – Project-Syndicate The Irresistible Rise of the Renminbi – Project-Syndicate China getting

1

The long path to Greek resolution

Courtesy of James Shugg and Sean Callow at Westpac Global Economics: The Eurogroup of finance ministers and central bankers met in Riga last Friday amidst (accurate) speculation that little progress would be made towards reaching an agreement between the Greek government and its creditors on the measures Greece must (re)commit to in order that the long-delayed

10

Greece folds

Greece blinked first then: Eurogroup statement on Greece The Eurogroup reiterates its appreciation for the remarkable adjustment efforts undertaken by Greece and the Greek people over the last years. During the last few weeks, we have, together with the institutions, engaged in an intensive and constructive dialogue with the new Greek authorities and reached common

52

Grexit talks break down

From the FT: …A high-stakes meeting of eurozone finance ministers over the future of Greece’s bailout unexpectedly broke down early in deliberations after Athens angrily objected to a proposal that it continue with the terms of its current €172bn bailout, calling it “absurd” and “unacceptable”. The draft text, obtained by the Financial Times, states that

9

Greece vs Germany death match

Cross-posted from Yves Smith at Naked Capitalism. Even though the US has waded into the Greece versus Troika impasse to press Eurozone officials to soften their position on austerity, the battle lines seem only to get harder. Today, February 11, an emergency meeting of the Eurogroup, a committee of 19 Eurozone finance ministers, officially begins

6

Why are markets ignoring the Grexit?

From Goldman Sachs: EMU Peripheral Yields Have Decoupled from Greece in Levels … Greek sovereign bond yields have been going up since last September and, since January, the term structure has become inverted. Explaining the divergence with the rest of EMU have been a number of factors including: the approaching end of the ‘troika’ funding

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What will a Grexit do to Australia?

There’s no better illustration of the coma cast over markets by central banks right now than Grexit insouciance. Equities are blase and bonds much the same with only small moves higher in peripheral European bond yields. UBS sees breaking this spell as a key step in preventing the worst case outcome: The terms of a

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Pettis: Europe is a war of bankers not nations

Cross-posted from Michael Pettis‘ blog: European nationalists have successfully convinced us, against all logic, that the European crisis is a conflict among nations, and not among economic sectors. Today’s Financial Times has an articlediscussing the travails of Greece’s new Finance Minister, Yanis Varoufakis as he takes on Germany: In a small but telling sign of the

12

Greece’s next act

Nearly 4 years ago I authored a post on MB titled “Greece’s inevitable default” in which I outlined why I suspected that Greece would continue to stumble from bailout to bailout while the economy slowly imploded. … I am simply going to explain what has happened so that I can explain why under the current

6

Greek election looms as ECB weighs QE

by Chris Becker It’s getting close to three very important dates on the economic calendar that all investors should watch and prepare their risk management accordingly. First, the German 2014 GDP print later this week will precede the first ECB meeting of 2015 on the 22nd of January where some sort of QE program is likely

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Can Germany save the Euro?

Cross posted from The Conversation by Gregory T. Papanikos Honorary Professor, Department of Economics at University of Stirling Germany has sent the message that a Greek exit from the eurozone might be the lesser of two evils. It has been interpreted as a warning to the Greek electorate ahead of its January 25 election as

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Eurozone slips into deflation

by Chris Becker Normally, you should cheer on lower inflation as your disposable income becomes more valuable. And with oil prices falling and mortgage rates at record lows, its doubly cheerful! But in Europe, unless you’re German, tough luck. Overnight we saw two very important prints that will shake the ECB up when it meets

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Will the Grexit happen this time?

by Chris Becker We’re seeing two stories emerge from yet another Greek crisis over the weekend, as the people head to the polls for what is likely to be a lose-lose election outcome. First, the real occupiers of power in Greece, the Germans, publicly contend that they want the beleagured nation (or is it dominion?)