The market seems not to get this. For today it's simply celebrated the big 'aGreekment' with total credulity. Yet it's not clear that Grexit has been anything more than forestalled.
At the end of the day, the EU committed to next to nothing regarding debt restructuring which means at some point whether in a few months or a few years they will be back here again.
In any case this assumes that Greece actually implements this deal which is not a done deal. There is the question of whether the Parliament will pass this deal that basically abrogates its own sovereignty to the EU.
Even if it does it may not be in time. Implementing this all in time is far from a given.
http://www.cnbc.com/2015/07/13/mohamed-el-erian-warns-markets-on-messy-greek-deal.html
"Investors enjoying the afterglow of a putative deal that will keep Greece in the euro zone for now might not want to get too comfortable."
"Even after conquering seemingly insurmountable odds to strike a bargain with European authorities, the debt-plagued nation's biggest challenges await."
"Overcoming the political fallout from forced austerity and trying to generate the kind of economic growth that will make the deal's conditions sustainable present the very real possibility that a Greek exit, or "Grexit," from the euro zone remains an inevitability."
"The likelihood of short-term Grexit remains significant given the strong conditionality contained in the proposal," Citigroup analysts said in a note. ( Tweet This )
http://www.cnbc.com/2015/07/13/sorry-but-grexit-chance-is-still-significant.html
Meanwhile, as we speak, Greek banks are running out of money. The current banking crisis in Greece is setting historical precedents of totally the wrong kind.
"Now entering the third week of a bank shutdown, Greek depositors have been pulling an estimated 80 to 100 million euros a day from ATM machines that banks have been struggling to replenish with an emergency cash infusion from the European Central Bank. Additional transfers have been authorized for essential imports, according to Reuters."
"Bur even if Europe's central bank agrees to send more cash, the Greek banking system is a financial mess. The collapsing economy has created an expanding pile of bad debts that have further burned through Greek banks fragile capital cushion."
"Despite periodic banking crises around the world, there aren't a lot of precedents for the current Greek financial tragedy, according to Pew Research "
"Of the 147 banking crises identified between 1970 and 2012, only seven involved bank closures and asset freezes. Most of those were in Latin America. The most recent, in 2013, forced a bank holiday in Cyprus as part of an EU/IMF bailout."
http://www.cnbc.com/2015/07/13/greek-banks-starved-for-cash.html
Germany's 4th Reich seems to be working out better than the 3rd.
At the end of the day, the EU committed to next to nothing regarding debt restructuring which means at some point whether in a few months or a few years they will be back here again.
In any case this assumes that Greece actually implements this deal which is not a done deal. There is the question of whether the Parliament will pass this deal that basically abrogates its own sovereignty to the EU.
Even if it does it may not be in time. Implementing this all in time is far from a given.
http://www.cnbc.com/2015/07/13/mohamed-el-erian-warns-markets-on-messy-greek-deal.html
"Investors enjoying the afterglow of a putative deal that will keep Greece in the euro zone for now might not want to get too comfortable."
"Even after conquering seemingly insurmountable odds to strike a bargain with European authorities, the debt-plagued nation's biggest challenges await."
"Overcoming the political fallout from forced austerity and trying to generate the kind of economic growth that will make the deal's conditions sustainable present the very real possibility that a Greek exit, or "Grexit," from the euro zone remains an inevitability."
"The likelihood of short-term Grexit remains significant given the strong conditionality contained in the proposal," Citigroup analysts said in a note. ( Tweet This )
http://www.cnbc.com/2015/07/13/sorry-but-grexit-chance-is-still-significant.html
Meanwhile, as we speak, Greek banks are running out of money. The current banking crisis in Greece is setting historical precedents of totally the wrong kind.
"Now entering the third week of a bank shutdown, Greek depositors have been pulling an estimated 80 to 100 million euros a day from ATM machines that banks have been struggling to replenish with an emergency cash infusion from the European Central Bank. Additional transfers have been authorized for essential imports, according to Reuters."
"Bur even if Europe's central bank agrees to send more cash, the Greek banking system is a financial mess. The collapsing economy has created an expanding pile of bad debts that have further burned through Greek banks fragile capital cushion."
"Despite periodic banking crises around the world, there aren't a lot of precedents for the current Greek financial tragedy, according to Pew Research "
"Of the 147 banking crises identified between 1970 and 2012, only seven involved bank closures and asset freezes. Most of those were in Latin America. The most recent, in 2013, forced a bank holiday in Cyprus as part of an EU/IMF bailout."
http://www.cnbc.com/2015/07/13/greek-banks-starved-for-cash.html
Germany's 4th Reich seems to be working out better than the 3rd.
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