Greece's politicians on Monday lurched towards a ninth day of talks to try and form a government that could handle the country's acute financial crisis, stave off default and ensure Greece stays in the euro.
ATHENS — Greek bank stocks fell by more than 22% on Wednesday as the Athens market suffered a third day of turmoil following the election of a government led by leftist anti-austerity Prime Minister Alexis Tsipras.
Fears that Greek banks, facing increased deposit outflows, could be shut out of European Central Bank liquidity assistance if their assets were no longer accepted as collateral led to a rout as investors dumped financial stocks. Bank shares have fallen by a total of 40% since Sunday’s vote.
Hold your horses on that "finalized" deal. There are still numerous austerity measures to implement, details to wrap up, ribbons to cut, and bows to tie. Thus, the Greek Race to Unlock Bail-Out is on.
The Greek government is racing to complete a lengthy checklist of reforms demanded by international lenders before the end of February to unlock a €130bn bail-out agreed in the early hours of Tuesday morning after months of high-stakes bargaining.
Those looking for a bit of humor in the European debacle can find it in statements from Jean-Claude Juncker, head of the eurozone finance ministers.
Juncker says "I don’t envisage, not even for one second, Greece leaving the euro area. This is nonsense. This is propaganda. We have to respect Greek democracy."
Bear in mind this statement comes from the same man who said "When it becomes serious, you have to lie."
Whether or not Greece stays in the Eurozone and for how long is still debatable, but Greek CDS contracts are set to trigger next month after Greek parliament retroactively inserts collective action clauses (CACs) forcing all debt-holders to participate in the next deal.
Bear in mind that forced restructuring is the trigger, not the insertion of the CAC language itself.
The Financial Times reports Greece sets date for €200bn debt swap
IT WAS about one year ago that yields on the debt of a few struggling European economies, Greece chief among them, began drifting steadily upward. Since that time, the loss of market confidence has generated a series of yield spikes, each of which has been associated with a brief period of crisis and a flurry of policy bandages sufficient to stave off an immediate meltdown. But through it all, yields have continued their long march upward.