Market Trapped in Greek Tragedy

     I admit I'm relishing getting to speak of a 'Greek Tragedy'-I've been waiting to use that pun. The markets continue to react to conflicting news. 

    http://www.cnbc.com/id/102783602

    The futures are up right now and I think that may be due to over-optimism. 

     http://diaryofarepublicanhater.blogspot.com/2015/06/this-could-have-been-predicted-no.html

     Of course, that depends on what you think the optimal resolution of this saga is. I think it may well be for Greece to leave the euro. Dennis Gartman thinks the Greeks in their own interests should leave but won't because Germany won't let them go. 

    It seems that Tsipras wants to stay but he's taking some heat at home for it-he was elected on a platform of ending austerity. 

   "As Greek Prime Minister Alexis Tsipras embarks on a last-ditch effort to agree on a reform deal with creditors, a rebellion is mounting at home among his own Syriza party and the opposition.

Tsipras is in Brussels on Thursday to continue emergency talks with Greece's lenders after they rejected new reform proposals from his country earlier this week. Greece desperately needs further financial aid to avoid defaulting on its debt at the end of the month, but its creditors want an agreement on reforms before they release any more funds."

   "After the Greek delegation failed to produce a new set of proposals for discussion at a meeting of euro zone finance ministers Thrusday, the country's creditors -- the International Monetary Fund, the other euro zone countries and the EuropeanCentral Banks --presented their own set of reform plans."

   "Also on Thursday, newswires reported that ECB had maintained its limit of emergency liquidity available to Greece's banks."

   "Read More Live Blog: Greece nears default as European leaders meet"

    "Even if a deal is made, however, the prime minister faces a challenge getting it through the Greek parliament."

    "There's rebellion rumbling among the hardliners within his own Syriza party, who are expected to reject any measures which add to the burden on pensioners. The party's coalition partner, the right-wing Independent Greeks party, has also vowed to oppose any rise in the lower VAT (sales tax) on Greek islands – something proposed by Syriza in a bid to appease creditors."

     "Speaking to CNBC in Athens Thursday, Greek Minister for Administrative Reform, Giorgos Katrougalos, said that either there was going to be a "fair and equitable agreement, or none at all."

     "And if we have a fair agreement, a fair compromise, everybody's going to back it up," he said, although he warned that there was a limit to how much Greece would concede to lenders."

    "We want to pay back the money (that Greece has borrowed), but not a pound of flesh on top of that," he added. "We don't want the burden again to be on the weakest and the poorest and we have proposed equivalent measures to what the lenders demand."

     http://www.cnbc.com/id/102786706

     You wonder if they would consider the deal that Trispras offered this week as fair. Because any agreement they do get will be worse than that apparently. 

     "The Eurogroup meeting of euro zone finance ministers ended without any agreement on Greece on Wednesday, after the country's latest reform proposals – based mainly on tax rises rather than the spending cuts which creditors want to see - were rejected."

     "Greece's calls for its debt to be restructured also fell on deaf ears, as creditors said they would only consider this once Greece had implemented reforms and the remainder of its bailout program."

     "On Thursday, a Syriza party parliamentary spokesman said lenders' proposals were "annihilating" and showed that the "blackmail" was continuing, Reuters reported. All eyes are now on a two-day European Union (EU) summit starting on Thursday."

     Yet the markets remain optimistic at least at this moment with the Dow futures up over 80 points.