OK, so now that the greek people have, by referendum, declined to accept the terms put forth by their creditors for another bail out (in essence anyway, the offer had already expired by the time the referendum happened) does that signal Greece's exit from the eurozone and/or the EU?

This could be the most important economic and political event since 2008 or it could be a whole lot of nothing. In any case it ought to be a very interesting next few weeks.

7/6/2015 1:29:28 AM

I don't think that it'll happen at this Point. I think that the ball is in the EU court now, and they will or at least should give in a bit to the Greeks in order to preserve the EU and prevent a possible door from opening to Russia and/or China.

Having said that, I think that it is time for politicians to seriously consider tweaking how the EU functions, because I don't understand how you can expect a Country like Greece to improve under harsh Austerity conditions and a fixed currency.

7/6/2015 6:10:35 AM

I don't know man, I'd say the exit is more likely than not. It wouldn't be so much of an issue for the IMF to issue another loan even with a default (they've done that before), but these loans are being funded directly by the taxpayers I'm other countries. Recent polling shows that another Greek bailout is incredibly unpopular across rest of Europe, especially in Germany. Approving another loan to greece looks politically suicidal.

7/6/2015 7:07:31 AM

No one needed to invent a new word for "Greek exit", saving one syllable is not worth sounding like an idiot

7/6/2015 10:52:34 AM

I prefer the silly portmanteaus to lazily throwing "gate" on the end of things.

Anyway, so far the economic impact globally has been minimal. Chinese troubles are having a much bigger affect on stock markets than Greece. It's a bit of a surprise, to me anyway, that gold isn't getting much of a pop on the euro's losses. I guess the dollar is still enough of a safe haven that there isn't a lot of push towards gold. I've also heard it said that this is a political crisis more than an economic one so gold won't get the same kind of safe haven bump that it has before. I guess we'll just have to see how damaging this all ends up being to the euro as a currency. If it gets bad enough a lot of european money could flow into gold to push the price up.

7/6/2015 1:13:29 PM

so how is the e pronounced in Grexit? Is it the sound of exit or Greece?

7/6/2015 4:28:37 PM

Not a candle to 2008. We are talking, what, 35 bps of world GDP? Greek is a nothing event aside from some short term volatility.

If I'm a citizen of countries that will have to monetize the debt I'd be pissed though..

^^ China contributes more to global GDP in a week then Greece does in a year. Of course anything involving China will create more global headwinds.

[Edited on July 6, 2015 at 6:34 PM. Reason : X]

7/6/2015 6:33:35 PM

Yeah, Greece itself is pretty unimportant, it's the potential for contagion in smaller neighbors and also the need to manage this carefully lest you piss off other countries who did agree to austerity measures in exchange for a bailout that you have to worry about. You might keep Greece in the Euro and then see Italy, Spain, and Portugal leave or renegotiate payments if this is handled poorly.

It's fine line to tow, ultimately I think the Greeks probably do leave, but it might not be without causing more turbulence first.

7/6/2015 7:36:12 PM

Personally, I've been hoping for an exit. That's easy for me to say, as I'm not going to have to deal with the repercussions.

I'm hoping that Greece exits, begins to INTELLIGENTLY manipulate their currency, and that it eventually leads to meaningful growth. Then we can finally drop the idea that austerity is a relevant solution to these kinds of debt problems, and all of the EU, ex-banker technocrats will finally be seen as the crooks and fools they are.

There are a million hurdles to overcome before they will come to that point though.

7/6/2015 11:20:11 PM

I would be all for that, it's a fucking shame that EU imposed Austerity is destroying parts of southern Europe such as Spain and Italy.

7/7/2015 6:10:23 AM

Quote :

"I would be all for that, it's a fucking shame that EU imposed Austerity is destroying parts of southern Europe such as Spain and Italy."

Austerity is a consequence. The EU didn't just decide to "impose austerity" for shits and giggles - they got tired of sending good money after bad.

7/7/2015 10:43:39 PM

I think Greece should default but stay in the monetary union. Greece would hopefully face a ruinously high interest rate and credit would dry up quickly. Thus, Greece would be long term stable, just that many government debts go unpaid now and then. Greek Banks might cease to exist, but banks from outside Greece can open branches within Greece to take over.

7/8/2015 12:07:29 AM

Quote :

"Austerity is a consequence. The EU didn't just decide to "impose austerity" for shits and giggles - they got tired of sending good money after bad."

They imposed Austerity because they were thinking in their own interest instead of putting forth the best Option that would get Greece running again, so they basically just put in mechanisms that would help them get their money back. I don't understand how you are going to secure a fixed, stable currency across the entire EU but then not work together for an equally broad, compromising Approach that is commiserate to the fact that Greece can't change its currency and play the deficit spending games that many other countries would do in this Situation.

[Edited on July 8, 2015 at 6:42 AM. Reason : d]

7/8/2015 6:41:46 AM

^This.
I'll add that we shouldn't forget the role big banks played in hiding Greek debt before the meltdown and while joining the union (and of course the banks got bailed out) and the role the ECB played in overheating the Greek economy in the mid-naughts (when the ECB was playing fast and loose to help speed up Germany).


All that being said, Greece still deserves a haircut, they've already taken some. It's just the cutting and cutting, while their GDP shrinks by 10% year over year is hopeless. It's punishment for punishment's sake with no hope of a resolution.

Personally I think they are trying to make an example of Greece so that other troubled countries bow to all demands.

7/8/2015 10:17:36 AM

http://www.newyorker.com/news/john-cassidy/grexit-an-indecent-proposal-from-germany

I guess things are rapidly getting out of hand. This leaked memo recommends offering a temporary (alleged) 5 year exit from the euro or some harsh austerity + the transfer of €50bn in government assets to a privatization fund. Folks on Twitter claim that the fund is chaired by the German finance minister. #thisisacoup trending now.

7/12/2015 8:55:41 PM

Greece should get out.

Everyone knows the sole purpose of austerity is to get the foreigners their money back. If they get out, the only incentives they have to worry about are their own.

7/13/2015 12:40:45 AM

Greece should get out.

Everyone knows the sole purpose of austerity is to get the foreigners their money back. If they get out, the only incentives they have to worry about are their own.

7/13/2015 12:40:45 AM

Greece should get out.

Everyone knows the sole purpose of austerity is to get the foreigners their money back. If they get out, the only incentives they have to worry about are their own.

7/13/2015 12:40:45 AM

deal done. They stayin.

#BanjoMan=PROPHET


[Edited on July 13, 2015 at 8:53 AM. Reason : h]

7/13/2015 8:36:18 AM

I would imagine there are going to be some nasty protests in Athens in light of this deal.

7/13/2015 9:49:40 AM

Fifty Cent has declared bankruptcy.

Not sure if it's related.

7/13/2015 11:45:14 AM

A general strike has been called for tomorrow in Greece. The government may face a revolt.

7/14/2015 10:03:08 AM

How would anyone be able to tell if there's a general strike in greece? Nobody there works.

I guess I'm both a bit surprised that Greece is staying in and simultaneously not at all surprised with the reaction to it. The ruling party made a bunch of promises that is could clearly not keep. There was not a single outside observer that believed anything Tsipras said during the campaign. No way he could deliver what he promised re: no more austerity measures.

What is a little bit startling is that the people of Greece actually bought it. Maybe that's why they're so angry now. They pinned their hopes on something that deep down they knew was bullshit and now it's been revealed to be bullshit.

7/15/2015 12:12:31 AM