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Monday, December 29, 2014

Roger Farmer : "The Greek dance with debt"

Roger Farmer's Economic Window: The Greek dance with debt: If you thought that the Greek debt crisis was over; think again. Tomorrow, the Greek parliament will try, for the third time, to agree on w...

One hour ago Parliament decided to have an election by Feb. 1st

Most likely scenario (60% probability):

  1. SYRIZA tops the polls without a Parliamentary majority.
  2. Only potential, anti-MOU, coalition partner, right-wing ANEL party, does not enter Parliament by some 0.3 percentage points.
  3. Only possible coalition partner(s) are the conservative ND of incumbent PM, PASOK, or POTAMI.
  4. None of these three can, or will, stomach the programme of SYRIZA.
  5. The left wing inside SYRIZA will not stomach any compromise on the campaign programme.
  6. New elections are anounced for sometime late Feb or beginning March
  7. The bailout programme expires on Feb 28
  8. Rating agencies downgrade Greek debt and ECB cannot accept it as collateral. ELA is the only mechanism for financing Greek banks and the Athens bourse tanks; as I write, it is down 10%. 
  9. Armageddon for the Greek economy.
  10. Brussells, Berlin, and Frankfurt "shrug shoulders" and carry on "business as usual".
  11. EURO is saved(!!!) at a bearable cost.

Disclaimer: I am about to lose something like 50% of the purchasing power of my pension on top of the 45% I have lost since 2010

"Euro zone rattled as Greece braces for elections" : Reuters
"Greece's Presidential Vote Just Failed And Markets Are Crashing" : Business Insider

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