Will Greece become first developed country downgraded to an emerging market?
Wed, 06/20/2012 - 09:25 EDT - Financial Post
Greece is still at risk over the long term of becoming the first economy to be relegated from developed to emerging market status within investment indices, even if it has fended off any immediate exit from the eurozone
LONDON (Reuters) - Greece is still at risk over the long term of becoming the first economy to be relegated from developed to emerging market status within investment indices, even if it has fended off any immediate exit from the euro zone. The unprecedented switch, reversing a path Greece trod only 11 years ago, would cut the country off from investors in more sophisticated markets although it would open it up to fund managers who are more comfortable with risk. ...
A week ago we joked that Greece was rapidly sliding into the "fourth world" (and had the photos to prove it). Well, today Equity Index provider MSCI took our joke and made it into something way too serious when overnight it made Greece the first developed nation ever to be downgraded into "emerging market" status. Not quite fourth world, but that too will come.
Global financial markets are feeling quite apprehensive these days. Three of the four risk appetite indicators that Credit Suisse tracks are in panic territory, and the fourth is fairly close to it. But as is so often the case, the stampede is happening a little late – a reaction to a growth scare from five months ago, rather than a reflection of the future that leading indicators foretell.
Neil Woodford is the Head of Investment at Woodford Investment Management and was formerly Head of UK Equities at Invesco Perpetual was asked a number of things about what he thought was the greatest risks within the world economy right now?
Woodford said: “I see a lot of risk in the world economy. I think growth is the problem, and deflation, really. So I think the world is facing a structural absence of growth for all sorts of reasons…”
LONDON (Reuters) - Greece is still at risk over the long term of becoming the first economy to be relegated from developed to emerging market status within investment indices, even if it has fended off any immediate exit from the euro zone.
By R Sriram These days when you hear the word 'risk-off ', it is usually accompanied by a reference to emerging markets. Global investors — petrified by political crisis in countries such as Brazil, Turkey, the commodity price collapse and the looming spectre of a Chinese hard-landing — have been giving emerging markets a big miss in the past few years. It is not surprising considering that emerging markets (EMs) have been such woeful underperformers across asset classes.
Coordinated MeddlingEurozone leaders are pouring it on thick again today with warning after warning. Yesterday, German chancellor Angela Merkel, French president Francois Hollande, and European Commission president Jean-Claude Juncker were all I in on the Coordinated Meddling hoping to convince Greece citizens to accept the current offer.Rajoy Seeks to Save His Own Ass
“Much better than expected.”
That’s how John Derrick, Director of Research here at U.S. Global Investors, summed up his trip to Greece, the beleaguered country that hopes to put its financial woes behind it and rise again like the phoenix from the Mediterranean culture’s ancient mythology.
BRUSSELS/ATHENS — Greece has three days to reassure Europe and the International Monetary Fund it can deliver on conditions attached to its international bailout in order to receive the next tranche of aid, four eurozone officials said on Tuesday.
The lenders are unhappy with progress Greece has made towards reforming its public sector, a senior eurozone official involved in the negotiations said, while another said they might suspend an inspection visit they resumed on Monday.
ATHENS: Greece was officially declared in default on Friday, injecting even more urgency into a make-or-break weekend referendum that new polls suggested was too close to call. The fund providing Greece's financial lifeline declared "an event of default by Greece". The European Financial Stability Facility added, though, that it had decided to not immediately demand repayment of its loans -- a step that analysts say could have triggered sudden "Grexit", or Greece's exit from the eurozone.