Greek elections are set for June 17th following the impasse of the last election where no majority government formed.
The "Destroy Greece to Save the Euro" clowns led by German Chancellor Angela Merkel are out in force hoping to turn the vote into a direct referendum on the Euro. The election is of course a direct referendum on the Euro, but Greek citizens are under three Fantasyland ideas.
Three Fantasyland Ideas
It would be quite ironic and rather fitting if Germany and France fail to ratify the Merkozy treaty. 25 Nations have ratified the treaty but France and Germany still have not.
French president Francois Hollande has already threatened non-ratification unless the treaty is revised.
The Leader of the Social Democrat Party (SPD)in Germany, Frank-Walter Steinmeier, is making similar threats for the first time.
BRUSSELS — Within minutes of eurozone finance ministers reaching a deal to cut Greece’s debt late on Monday, commentators on Twitter were dismissing it as another exercise in “kicking the can down the road”.
To an extent that is true. Under the agreement, the euro zone and the International Monetary Fund will give Greece two more years to reach its budget goals and will find another 44-billion euros (US$57-billion) to keep the country afloat in the meantime.
As I watch the implosion of Greece, with shops closing everywhere and GDP plunging like a rock, I cannot help but wonder if we are witnessing the start of a similar trend in Italy.
To be sure, Italy has a manufacturing base that Greece does not have, but retail aspects and shop closings in Rome as compared to Athens seems rather similar.
If that sounds far-fetched, please consider Summer of gloom for crisis-hit Rome shops
By Peter Boone and Simon Johnson
The EU, led by France and Germany, appears to have some sort of financing package in the works for Greece (probably still without a major role for the IMF). But the main goal seems to be to buy time – hoping for better global outcomes – rather than dealing with the issues at any more fundamental level.
The Mole submits: In a session yesterday that was largely devoid of economic data, most of the focus was again on Europe’s fiscally troubled sovereigns. Whilst ECB President Trichet noted that he was confident that negotiations on the Greek fiscal package would be “concluded soon and rightly,” Greek 2-year bond yields surged 294bps to 13.16% with the 10-year yield up 91bps to 9.56%.