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The Really Useless Thread

  • #135,941
  • Edited 9:36am Jul 5, 2015 9:23am | Edited 9:36am
Following the Greek drama in the background this weekend. Voting closed and all exit polls shows a "No" win. However, the "shame factor" of publicly admitting voting YES could play a roll according to the experts on the official result.

Whatever the case (this vote is irrelevant for a deal as they are voting for an expired issue), the current government pretty much have everything under control to keep the drama flowing until they default to the ECB in a couple of weeks.

A "No" vote will only confirm the new deal proposal that is pretty much done and on the table since last week. Failure to reach an agreement (not expected for now) and Greece will get kicked out of the Euro by "default".

A "Yes" vote will only be important if the current government doesn't withdraw quickly without making further problems, allowing banks to be open quickly before they run out of cash and violence and anger start igniting in the streets ....

For the euro, the only result that markets wont like is panic, looting or violence in the streets if the economy and banks don't reopen very soon.... any other outcome will end with a new deal and kicking the can for at least 2 years.

Nothing to see here, expecting lots of talking heads, contradictions like usual and noise whatever the result until the official results are confirmed and especially for the Monday european opening....

Tracking 1.114x for the W open today ....

sisse
Pending conversations? PM for a chat...I am mainly in OTM now
  • #135,942
  • Jul 5, 2015 10:05am Jul 5, 2015 10:05am
Quoting sisse
A "No" vote will only confirm the new deal proposal that is pretty much done and on the table since last week. Failure to reach an agreement (not expected for now) and Greece will get kicked out of the Euro by "default".
https://en.wikipedia.org/wiki/Pyrrhic_victory

Oh boy, more drama. But the Final Act is coming. Greece is gonna fall out the backend of the EMU any day now as the banks there run out of cash without the ECB pipeline open. Are we still waiting to see who blinks first? OMG, I fully expect to see Yanis Varoufakis on "Dancing With the Stars" soon.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #135,943
  • Jul 5, 2015 10:30am Jul 5, 2015 10:30am
Quoting The Fool
{quote} https://en.wikipedia.org/wiki/Pyrrhic_victory Oh boy, more drama. But the Final Act is coming. Greece is gonna fall out the backend of the EMU any day now as the banks there run out of cash without the ECB pipeline open. Are we still waiting to see who blinks first? OMG, I fully expect to see Yanis Varoufakis on "Dancing With the Stars" soon.
JE JE JE ....

You couldn't find a better term: A pyrrhic victory indeed mate !!!. I bet this phrase will catch up with the mainstream media lurking the interwebs ...

The other 18 EZ governments wont be really happy with a NO vote.There will be one more chance for negotiations on the new proposal last week but after this vote (if confirmed NO), the EZ has NO alternative than threating to pull the trigger via the ECB...and that's when markets will put an end to the Greek political circus ...

If we get the confirmation of the NO vote in a few, everything will fall out again on the ECB. The "rain maker" has the actual lethal trigger in all this. If it gets the go ahead to pull the plug on Greek banks, Greece will technically has 72 hours before collapse ....

we'll see

sisse
Pending conversations? PM for a chat...I am mainly in OTM now
  • #135,944
  • Jul 5, 2015 10:35am Jul 5, 2015 10:35am
Quoting sisse
{quote} JE JE JE .... You couldn't find a better term: A pyrrhic victory indeed mate !!!. I bet this phrase will catch up with the mainstream media lurking the interwebs ... The other 18 EZ governments wont be really happy with a NO vote.There will be one more chance for negotiations on the new proposal last week but after this vote (if confirmed NO), the EZ has NO alternative than threating to pull the trigger via the ECB...and that's when markets will put an end to the Greek political circus ... If we get the confirmation of the NO vote in...
320 + 90 (ELA). Explain that to taxpayers who will have to bear it since their gov't transferred the debt to them from private holders. Draghi can't bear such decision. Nor is the ECB in position to enforce Greece to repay. Result will be 61%+ for 'no', just announced from Ministry of Interior.
  • #135,945
  • Jul 5, 2015 10:50am Jul 5, 2015 10:50am
Quoting sakisf
{quote} 320 + 90 (ELA). Explain that to taxpayers who will have to bear it since their gov't transferred the debt to them from private holders. Draghi can't bear such decision. Nor is the ECB in position to enforce Greece to repay. Result will be 61%+ for 'no', just announced from Ministry of Interior.
I have been waiting for the slow motion explosion to be done & the smoke to clear - little skin in the game but been sleeping well anyway. Will the euro rally if Greece is let go? And equities, bonds? I have been thinking that the true "relief" rally would be on relief that Greece would no longer be a drag on the EU, and that the fears of "contagion" were just red herrings. But we'll see soon enough, I suppose.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #135,946
  • Jul 5, 2015 10:51am Jul 5, 2015 10:51am
Quoting sakisf
{quote} 320 + 90 (ELA). Explain that to taxpayers who will have to bear it since their gov't transferred the debt to them from private holders...."
....ehhh well the same on the other side of the equation: 220 billion on EZ loans to Greece since 2010 that are going to get flush in the toilet. Explain that to taxpayers?


Quote
Draghi can't bear such decision. Nor is the ECB in position to enforce Greece to repay. Result will be 61%+ for 'no', just announced from Ministry of Interior.

Yeap seems like a clean sweep.

The ECB only needs to receive the political go ahead and apply the technical rules to stop injecting euros to the Greek banks. Greece already defaulted and voted no to any bailout. Sadly, there is no much the ECB can argue in favour ....

We'll see, bun talking head and politicians in full control for the circus in the next few hours. ..

sisse
Pending conversations? PM for a chat...I am mainly in OTM now
  • #135,947
  • Jul 5, 2015 10:52am Jul 5, 2015 10:52am
Quoting The Fool
{quote} I have been waiting for the slow motion explosion to be done & the smoke to clear - little skin in the game but been sleeping well anyway. Will the euro rally if Greece is let go? And equities, bonds? I have been thinking that the true "relief" rally would be on relief that Greece would no longer be a drag on the EU, and that the fears of "contagion" were just red herrings. But we'll see soon enough, I suppose.
too many arguments either way I think. Greece leaving is good, but then one could argue other countries might want to join the club. everyone is trying to keep the union together at all costs, but Greece is not making it easy

ah we wait and see. looks like NO is in the clear so far.
  • #135,948
  • Jul 5, 2015 11:00am Jul 5, 2015 11:00am
Quoting darimik
{quote} too many arguments either way I think. Greece leaving is good, but then one could argue other countries might want to join the club. everyone is trying to keep the union together at all costs, but Greece is not making it easy ah we wait and see. looks like NO is in the clear so far.
"Whatever doesn't kill you only makes you stronger." ... is a saying I never really agreed with. If Greece goes and that becomes a success story, even marginally, then that could be a problem for the EU...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #135,949
  • Jul 5, 2015 11:01am Jul 5, 2015 11:01am
Quoting sisse
{quote} ....ehhh well the same on the other side of the equation: 220 billion on EZ loans to Greece since 2010 that are going to get flush in the toilet. Explain that to taxpayers? {quote} Yeap seems like a clean sweep. The ECB only needs to receive the political go ahead and apply the technical rules to stop injecting euros to the Greek banks. Greece already defaulted and voted no to any bailout. Sadly, there is no much the ECB can argue in favour .... We'll see, bun talking head and politicians in full control for the circus in the next...
Unfortunately the majority of this money has gone into the banks. Hardly any of it ended into people's pockets - other than some friends of the previous regime - or infrastructure. They just bailed out the Greek banks as they did with their own and transferred all this debt to the people. EZ is just a mess. Greece should have defaulted in 2010 and then supported with less than the bailout funds to bring up a smaller economy with GRD. All these bailouts and new debts added just made the mess bigger.
  • #135,950
  • Jul 5, 2015 11:20am Jul 5, 2015 11:20am
Quoting The Fool
{quote} "Whatever doesn't kill you only makes you stronger." ... is a saying I never really agreed with. If Greece goes and that becomes a success story, even marginally, then that could be a problem for the EU...
Looks very far and wishful thinking. A country who "...has spent a combined 90 years — almost half of the time since its independence in financial crisis" with such a deep structural problems (from corruption, unemployment, to very low productivity and with a mammoth unsustainable public sector and very little private initiative with in the economy) the odds are very low with or without the euro....

Quoting sakisf
{quote} Unfortunately the majority of this money has gone into the banks. Hardly any of it ended into people's pockets ....
Agree but that doesn't address the question for the population of the other 18 countries in the EZ that are tired of the drama, annoyed about getting insulted and middle finger by the Greek politiicans ever day in the press and especially sick of pouring good money after bad without any results ....

Sadly the current Greek government has polarise so much the issue, that its a matter of time the EZ put a hard stop and let Greece sink in their own drama .... I hope I, and most of the neutrals outside of Greece are wrong about this and suddenly Greece become a positive force in Europe and become the next Norway in no time ....

sisse
Pending conversations? PM for a chat...I am mainly in OTM now
  • #135,951
  • Jul 5, 2015 11:20am Jul 5, 2015 11:20am
Quoting The Fool
{quote} "Whatever doesn't kill you only makes you stronger." ... is a saying I never really agreed with. If Greece goes and that becomes a success story, even marginally, then that could be a problem for the EU...
Sidetracking from Greece, reminds me one tiny island discussed 2008. Namely Iceland. No bailouts, nationalized teh banks, went basically bankrupt, overthrown government, imprisoned crooked banksters....and tadaa.... riding out on winning wave. And everyone is silent. Is never mentioned in media, as such success stories are undermining bailouts and preserving current status quo. Noone needs to hear that.
"I know one thing, that I know nothing." Sokrates
  • #135,952
  • Jul 5, 2015 11:36am Jul 5, 2015 11:36am
Oxi... great news. Now for the next round of negotiations. I'm curious if we see anything substantial before the summerbreak. Unless Greece pulls the the chute of course.
A 'yes' would have putten the EZ under imense pressure to unshelf the rotten deal they presented to the greek government. This pressure is now gone.
Fail better.
  • #135,953
  • Jul 5, 2015 11:45am Jul 5, 2015 11:45am
Quoting LarryDarrell
.... A 'yes' would have putten the EZ under imense pressure to unshelf the rotten deal they presented to the greek government. This pressure is now gone.
... thats a intelligent way to see it from a different angle. I actually pretty much agree with you comment.

Quote
I'm curious if we see anything substantial before the summer break...

Oh yeah definitely.

Next week there is a small repayment due to Private holders. Failure will make a second default but this time the Rating agencies will qualify this as Default (so all major ratings will put Greece on death sentence putting all other private debt holders [small %] on default mode and triggering all the correlated issues of officially entering in private bankruptcy black list).

But more importantly, the week of the 20th we have the first large repayment to the ECB. A no deal, no payment will put Greece in a third default but this time with the biggest lender the ECB/EZ governments and that is the end of the game without a deal ....

...map is getting clearer by the minute and talking heads are starting to come in the media so we'll get the final map update for the coming days/weeks before the open today ....

sisse
Pending conversations? PM for a chat...I am mainly in OTM now
  • #135,954
  • Jul 5, 2015 11:59am Jul 5, 2015 11:59am
So what now, based on the NO vote to an expired offer. Rather disgustingly, Greece will want to negotiate further concessions from the creditors who Varoufakis called terrorists. Besides humanitarian aid, I'd rather Europe focus it's efforts on limiting contagion to other countries, as long as Greece does not take measures of political and socioeconomic reforms.

The European sweet talking will continue to save the rather rotten 'European project', as a single currency benefits stronger nations while penalizing weaker economies.

Expect pressure on stocks and a shaky market ahead, at least until the confusion is cleared.
  • #135,955
  • Jul 5, 2015 12:21pm Jul 5, 2015 12:21pm

  1. Jun 27, 2012 7:27am


Quoting gatorinla
{quote} the basic "rule of 72".. says the euro will not be around w/o devalue. german (e central bank) economics in sequence go from 69, 70, 71, 73, 74, 75. and wall street/London ect. sit back and ignore 72 is missing. the bond market sees it buy don't believe the rest are so stupid. ... the basic "rule of 72" says china will fail to live up to world expectations. in basic.. "a mule that shits fast, don't shit long"
http://www.forexfactory.com/news.php?do=news&id=547854

Quote
China rolls out emergency measures to prevent stock market crash

  • #135,956
  • Jul 5, 2015 12:26pm Jul 5, 2015 12:26pm
...and that was it for this weekend Drama. All cards on the table. It's official "NO" won by a landslide. The only real winner in the circus was the current government.
They are now free of sins if Greece leave (or get kick out) the euro.

In any case, for what it matter to the rest of us in the business 3 scenarios in play.

Expecting lots of jitters and uncertainty for the open until the big fishes in the EZ (Merkel and Hollande meeting tomorrow evening confirmed) have their final saying and then all the eyes on the ECB.

As long as the scenarios in play are in the political side, markets wont do much but as soon as the circus is clear we'll have strong moves that have been on hold because the drama. For now:

 

  1. Priority is on the banks running out of cash as early as next Friday (that is when the no voters will have to face the consequences of their vote). Expecting technocrats and bankers all over the place making deals under the table to give more time to the politicians to resolve the issue until the end of July. More than probably we will get a short term deal on that front that will make the euro stay constrain in the current wide chop zone.

 

  1. The second issue is new negotiations for a deal that looks very grim so far. If no deal is agree until Greek banks run out of money expecting a partial expel of Greece from the EZ. In order to pay bureaucrats, doctors, teachers and etc and reopen the economy some kind of parallel currency to be used for some domestic transactions ("IOUs") in the short term (e.g Argentina) opening a relief rally in the euro (kicking the can till Dec) and smooth road to Grexit by next year if things hasn't turn around. Expecting euro to shake out the jitters after banks reopen and a relief rally to at least the 1.15xx handle before hikes get in play.

​​

  1. The third and least probable scenario is, a crash in the negotiations this week with the EZ/ECB pulling the plug on the Greek banks, and letting the dice roll when people start realising they just lost all the money in their banks (or going to be replaced by new drachmas with 1 / 100 of its value). This a dangerous scenario as it will trigger risk and panic in the markets. Expecting euro selloff on panic (via dollar too) to 1.073x in no time and the after the continuation moe to parity via FED later. However, this scenario will be v. positive for the long term in the euro....but that is for later...


Tracking 1.114x until the european open. Choose you posing time if you haven't. i already chose mine so GL all....

sisse

Pending conversations? PM for a chat...I am mainly in OTM now
  • #135,957
  • Jul 5, 2015 12:49pm Jul 5, 2015 12:49pm
Quoting Tom_D_Trader
{quote} Sidetracking from Greece, reminds me one tiny island discussed 2008. Namely Iceland. No bailouts, nationalized teh banks, went basically bankrupt, overthrown government, imprisoned crooked banksters....and tadaa.... riding out on winning wave. And everyone is silent. Is never mentioned in media, as such success stories are undermining bailouts and preserving current status quo. Noone needs to hear that.
yep, interesting comparison - as far as it goes. Iceland population much smaller than Greece - 330,000 vs 11,000,000, complete energy independence a plus for Iceland, too. I could see how anyone could go either nai or oxi in Greece, but, as hard as that was, the vote was the easy part. Now comes the hard....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #135,958
  • Jul 5, 2015 12:53pm Jul 5, 2015 12:53pm
Quoting The Fool
{quote} yep, interesting comparison - as far as it goes. Iceland population much smaller than Greece - 330,000 vs 11,000,000, complete energy independence a plus for Iceland, too. I could see how anyone could go either nai or oxi in Greece, but, as hard as that was, the vote was the easy part. Now comes the hard....
....dont forget to add a country was 3 time richer, 20 times more developed, no corruption, a tiny and very efficient economy, and structurally 1 mill times better in any economic, political and social aspect.

Iceland was a bank solvency VERY TINY collateral problem during the biggest financial crisis in the world in the last 100 years .... there is no point of comparing with Greece. Greek problems are beyond banks. They are deep and structural.

sisse
Pending conversations? PM for a chat...I am mainly in OTM now
  • #135,959
  • Jul 5, 2015 12:54pm Jul 5, 2015 12:54pm
Quoting LarryDarrell
. A 'yes' would have putten the EZ under imense pressure to unshelf the rotten deal they presented to the greek government. This pressure is now gone.
Yep, Varoufakis was right. I am going to start selling Yanis Varoufakis posters on ebay. 10% off for FF members. Order today and I will throw in a (smaller) free poster of Schnauezel. Just don't put it up in your children's room.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #135,960
  • Jul 5, 2015 12:58pm Jul 5, 2015 12:58pm
Quoting sisse
.... there is no point of comparing with Greece. Greek problems are beyond banks. They are deep and structural. sisse
yep, good points. But I still can not afford to go party with Nordic babes in volcanic hot tubs under the northern lights in Iceland.....
"If The Fool persists in his Folly he will become wise." - William Blake
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