Archives of “greece” tag

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EU, Germany deny Greek bailout plans

  
Analysis, Economy, Education
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just-say-no

Breaking News-ASR

The question of EU financial aid to debt-stricken Greece is marred by contradictory reports of a bailout. The European Commission and the German government both denied the existence of an alleged €20-25 billion bailout plan as an EU mission landed in Greece yesterday (22 February) to assess the country’s rescue plans.

A Commission official denied allegations that the EU is reviewing a bailout package for Greece to the tune of €20-25 billion after the Germany’s Der Spiegel magazine allegedly got hold of a paper from the country’s finance ministry detailing the terms of Berlin’s contribution.

The EU formalised its support for a Greek rescue, should the time come, at an EU summit two weeks ago, but member states refused to say how much a bailout could cost and how the money would be raised (EurActiv 17/02/10).

“Greece has not requested a single euro,” the Commission official told the press, rejecting claims that calculations of individual member states’ shares of a bailout were afoot.

German finance ministry denies ‘concrete plans’

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Sovereign Debt Estimates

  
Analysis, Economy, Education
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Sovereign debt is a key driver of the current economic jitters. The chart below shows next year’s sovereign debt estimates for the G-7 and other key global economies – the U.S. debt in 2011 would be about equal to GDP ($15 trillion), while the debt loads carried by Japan, Italy and Greece would exceed GDP.

Great NEWS :IMF to provide give €10 Billion to Greece

  
Analysis, Economy, Education
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The International Monetary Fund is looking at raising its share of Greece’s financial rescue package by €10bn ($13.2bn) amid fears that the planned €45bn bail-out will fail to prevent the country’s debt crisis from spiralling out of control.

Senior bankers and officials in Washington and Athens told the Financial Times that the IMF was in talks to increase its aid contribution by €10bn. The fund could make that sum available under a planned three-year loan, according to an Athens-based analyst familiar with the talks.

Investors and policy specialists said that expectations of the size of the three-year package in Washington policy circles had increased to at least €70bn. The EU has so far proposed to provide €30bn and the IMF €15bn. “The fund’s current ceiling for Greece is €25bn and the release of the extra amount is under discussion,” the analyst said. The IMF declined to comment on the size of the package.

Dear Readers & Traders ,We are again first in India to give this NEWS.And in afternoon or late by evening once this NEWS will be out.Then watch huge short covering across the Globe.

Technically Yours

ASR Team

Baroda ,India

A little European Geography lesson

  
Analysis, Education, Humour
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“Spain is not Greece.” Elena Salgado, Spanish Finance minister, February, 2010.

“Portugal is not Greece.” The Economist, April 2010.

“Greece is not Ireland.” George Papaconstantinou, Greek Finance minister, November, 2010.

“Spain is neither Ireland nor Portugal.” Elena Salgado, Spanish Finance minister, November 2010.

“Ireland is not in ‘Greek Territory.’”Irish Finance Minister Brian Lenihan. November 2010.

“Neither Spain nor Portugal is Ireland.” Angel Gurria, Secretary-general OECD, November, 2010.

“Spain is not Uganda” Spanish PM Rajoy. June, 2012.

Portuguese Bank Borrowings From ECB More Than Double In May, Hit All Time Record of €35.8 Billion

  
Analysis, Economy, Education, Forex
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Alas, the deteriorating funding environment in Portugal is not a fluke – according to the Bank of Portugal, bank borrowings from the ECB surged in the past month, and doubled from €17.7 billion to €35.8 billion in May. As Steven Major from HSBC said, quoted by the FT: “These yields are approaching that magic number of 5 per cent that is likely to be charged by the European stability fund. If the yields keep going up at this rate, then they will be paying much more than 5 per cent next month, which is arguably unsustainable.” And confirming the non rose-colored glasses reality was another banker who said: “These yields are not sustainable. Portugal will have to access the emergency stability fund if they continue to rise at this rate.” Elsewhere, Greece continue to be bankrupt.

The chart below shows total borrowings from the ECB by Portuguese banks…

Bank Exposure To Bulgarian And Romanian Sovereign Risk

  
Analysis, Economy, Education
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There’s been a lot of talk recently about Hungary following in Greece’s footsteps and potentially defaulting on its debt. Bulgaria and Romania are two other weak economies in Eastern Europe, and the chart below shows bank exposure by country to Bulgaria, Romania, Hungary and Greece (source):

It’s interesting to note the exposure that Greece has to Bulgaria and Romania. Romanian and Bulgarian debt comprise more than 25% of the foreign debt that Greek banks hold. Austria also has a high concentration of risk in these four countries, at 29% of total foreign claims outstanding.  When investors talk about contagion, what they are really referring to is positive feedback loops.  We can see from the chart above how trouble at one country can quickly develop into a concern for other countries.  The situation in Greece could make it difficult for Bulgaria and Romania to roll over their debt, an event which would in itself reduce the value of Greece’s assets, creating further difficulty for Bulgaria and Romania.

Is the U.K. the Next Greece?

  
Analysis, Economy, Education, Video
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A day after the EU has come to terms on a bailout to save Greece, this Bloomberg TV analysis is pretty interesting. First, they point out that the rates Greece got were still pretty punitive, despite the fact that they were below market rates. But even more interesting is the notion that the U.K., not Portugal, Spain, or Ireland, might be the next economy to be forced to the brink because they’re not part of the Euro Zone and don’t have the partners to bail them out.



Greek crisis clouds EU summit

  
  Education
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crisisThe fiscal emergency in Greece and the turbulence in debt markets are threatening to overshadow this week’s EU summit on business competitiveness. The problem poses a leadership test for Herman Van Rompuy, the EU’s first permanent president, who called the meeting. Greece’s debt crisis, and the risk of eurozone contagion,  are not on the summit’s official agenda, but leaders fear the impact on financial markets if the summit does not address the worst crisis to strike European monetary union since its launch in 1999.

Regulators to probe euro trades

  
Analysis, Economy, Education
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The regulatory fall-out from the Greek debt crisis grew on Wednesday as EU and US authorities said they would probe trades in the euro and the market in sovereign credit default swaps. European Commission officials said they would use a meeting as early as Thursday with banks and regulators to discuss regulation of trading in sovereign CDS, which have become politically contentious amid Greece’s financial crisis. The US justice department said it was also examining hedge fund trades against the euro.

What banks will be burned by Greece ?

  
Analysis, Education, Global Indices
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Greeceflag“At end-Q3 foreigners held EUR216bn of Greek government debt (72.3% of the total market, 90.2% of GDP), having doubled their position since end-04. Given recent downgrades and another round of revisions to budget data from previous years, a sharp slowdown or even reversal of inflows from foreigners into the local debt market has become an increasing risk.”

Read the full story on FT Alphaville’s blog, by Tracy Alloway

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