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Here we go: German government spokesman says reports about decision on aid for Greece are...

Here we go: German government spokesman says reports about decision on aid for Greece are "unfounded." (Reuters) S&P down 9 points in two minutes.
Comments (14)
  • songcatcher
    , contributor
    Comments (6) | Send Message
     
    Look out below.....
    9 Feb 2010, 12:44 PM Reply Like
  • nightfly
    , contributor
    Comments (1017) | Send Message
     
    No no, the bulls don't care, they have their ignore filters on full and this market will not retrace the bounce - also, since the EU markets are closed this morning's buyers are mostly eating dinner now.
    9 Feb 2010, 12:48 PM Reply Like
  • Tack
    , contributor
    Comments (13401) | Send Message
     
    Only fools would conclude that the EU will allow Greece to go belly up. But, the world's full of them, apparently.
    9 Feb 2010, 12:53 PM Reply Like
  • Harry Tuttle
    , contributor
    Comments (2221) | Send Message
     
    It is not only a matter of will.
    9 Feb 2010, 01:34 PM Reply Like
  • Tack
    , contributor
    Comments (13401) | Send Message
     
    You're serious, right?

     

    Greece's entire economy is smaller than Citibank's depressed market cap, or less than the state output of Kentucky. You think it's beyond the ability of the EU to bail it out?

     

    It's these kinds of detached-from-reality apprehensions and fears that lead to market silliness.
    9 Feb 2010, 01:59 PM Reply Like
  • Harry Tuttle
    , contributor
    Comments (2221) | Send Message
     
    I am very serious. Greece owes $300B financed at German-level rates which is as ridiculous as lending people with no income and no assets $300k to buy a house worth $290k.

     

    In addition, once they guarantee Greece, they will have to guarantee Portugal, Spain, and maybe Italy and Ireland as well. Not to mention Latvia, Hungary and all the other minions they have subsidizing through the multilateral institutions.

     

    Thailand was also once the smallest economies in Southeast Asia and the subprime market was a rounding error in the total mortgage market.
    9 Feb 2010, 04:15 PM Reply Like
  • Tack
    , contributor
    Comments (13401) | Send Message
     
    As I have posted in other threads, nothing can prevent a workout because the EU controls the printing presses for that debt, as we do here for dollar-denominated debt. It's when you have an Argentina-like situation that trouble becomes insurmountable. There, dollars were borrowed, but traders shorted the peso to zero, so it was impossible to renegotiate the debt.

     

    With Greece and others all dealing in Euros, it's a political question, not one of feasibility. The EU will not commit suicide.

     

    P.S. It's also why the death of the dollar --like Mark Twain-- has been exaggerated.
    9 Feb 2010, 05:18 PM Reply Like
  • youngman442002
    , contributor
    Comments (5131) | Send Message
     
    It is the play of the week though....the greece bond play...bailout play..Euro play...its all about greece
    9 Feb 2010, 01:32 PM Reply Like
  • Sumit Batra
    , contributor
    Comments (65) | Send Message
     
    Who will bail out usa?
    9 Feb 2010, 01:35 PM Reply Like
  • TXBankingExec
    , contributor
    Comments (123) | Send Message
     
    Isn't China already in the process of bailing us out by continuing to be a net purchaser of treasuries? Think of what would happen should those purchases grind to a complete halt, or if China were to become a net seller?
    9 Feb 2010, 01:47 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3080) | Send Message
     
    Many Greek labor unions have scheduled a 24 hour general strike for 10 February. It will be interesting to see what action that may prompt, if any, from the European Central Bank.
    9 Feb 2010, 02:29 PM Reply Like
  • mannettino
    , contributor
    Comments (1065) | Send Message
     
    I think few analysts are accurately looking at the economic situation and coming decisions in Europe. One exception is Stratfor (i am not affiliated, just a paying subscriber). Germany will do nothing to help Greece without extracting some serious benefits tantamount to a economic (vs military) takeover. This deal is far from done, since the Greeks know that their citizens aren't just going to become de-facto subjects of Berlin and Heir zu Guttenberg without making some noise. Germany, on the other hand, can make an offer to Greece that will be very difficult for them to accept, and then can still walk away if the noise level gets too high. That wil enable them to say 'we tried, they wouldn't listen' and still embellish their standing in Europe and the world. Make no doubt about this - this situation is ALL about a rising Germany emerging to lead greater Europe again....mark my words!
    9 Feb 2010, 06:57 PM Reply Like
  • Tack
    , contributor
    Comments (13401) | Send Message
     
    If Germany walks away, they control nothing and nobody, and they get themselves and the rest of Europe into an instant panicky crisis. It's hard to imagine what hegemony they'd enjoy over more dependent members of the EU if they allowed Greece to collapse and go back to its own currency. That might start a parade of others doing likewise.

     

    In the old days, Germany would have just sent out its army to run Europe; now, they have to be a bit more clever if they wish to maintain influence. If they want to be king of the hill, but with nobody playing anymore, then, walk, but, if they want to exert wider economic power, then, they have to play it smarter.

     

    I think they will.
    9 Feb 2010, 11:58 PM Reply Like
  • mannettino
    , contributor
    Comments (1065) | Send Message
     
    We shall see. The impact of "losing" the weakest members of the EU is overestimated. The argument could be made that a stronger, central core of EU states is a better solution. In the end they (the EU) could very well create a situation where the requirements for Greece are so difficult to accept, that the situation deteriorates. Keeping in mind that Greece's GDP & role in the world is not significant, this is not out of the question. However, you are right about the implications of such a direction given the other members of the so-called "PIIGS". There again, though, with the exception of Italy, the strategic relevance of the "club med" states is much lower, so things could still go in a different direction. Going to be interesting regardless. For sure, the Germans will give NOTHING without extracting something very meaningful in return.
    11 Feb 2010, 11:03 AM Reply Like
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