Good Morning,
Greece come out of round one without even a bruise winning the poker
tournament. The EU couldn't even afford to call their bluff and go to the wire
the EU (Germany) knew what was happening. The FT Greece and Eurozone agree bailout extension Peter Spiegel in
Brussels.
The markets are now realising the agenda of Greece but aren't
acknowledging the risks, save for the euro being trashed, off near 5% since the
debacle began to unwind. When certain EU countries appear weighted to benefit
by any austerity within the Eurozone, the underdogs will become bitter. The EU
have added some more fuel to equities by a Chinese type of intervention saving
the bondholders, namely themselves.
Greece have in essence been given a cooling off period, any negotiations
were too close to the Greek elections. In at least putting some space between
the two events perhaps, although unlikely, just perhaps Greece will yield to
the EU demands and lose some steam, a possibility but not without giving
something in return.
What it does show is the commentators who thought Greece do not have a
strong hand were wrong. As mentioned at the time on FTML, Greece have an agenda
and that is its own backyard, unlike some of the European Union. With Greece's
win yesterday, its wise to consider those risks approaching and the small print
of the extension.
With the current Dutch finance minister and eurogroup chairman Jeroen
Dijsselbloem, stating “I think tonight was a first step in this process of
rebuilding trust. As you know trust leaves quicker than it comes. Tonight was a
very important, I think, step in that process.” It’s fair to say the entire
process has become disenfranchised from the "EU" collective. Trust?
Really...If one needs to establish trust between a union and partnership, its
time to leave.
If Greece feel they have been compelled to take "Satan's
Schilling" or not is immaterial. Greece had the money and now common-sense
means with political change and blame they’re reviewing the terms and thinking,
"what have we done." The problem is, the entire EU, contrary to the
assertions by those alleged better informed analysts, is at stake. There may be
a common-agenda or policy with the loss of a currency.
Greece's default will ripple through the EU, with those in hardship
likely to vote for similar political representatives to broker such deals.
Would it be best to forget EU QE and await the outcome of Greece, Spain,
Portugal and Italy await the knock on effects? I doubt it, but one might just
be throwing good money after bad...
There's some gossip doing the rounds about Wolf Minerals (WLFE). Its
certainly not the price of Tungsten APT US$292.5/MTU. Hmmm...The hilarity
was the contraction in the oil price with positions requiring to anti up more
margin or close on Thursday and Friday, so what happened to the price!?!?!
Those cheapskates sold their positions, thank you for making the Christmas card
list!
Its suspected Malcy is the cause of the gossip and reviews on Gulf Keystone
after his views on iii…
Short one as it was very busy Friday and Saturday even allowing for Manflu
and the like.
Atb Fraser
Fraser- Hi- Out all Friday too (Rutland trip to wine merchant and Olive Branch lunch- v decadent) so just catching up here. Can see a FTML so perhaps the techies failed there.
ReplyDeleteRe Greek- I will have to disagree as it looks to me like the Greeks have had to go home covered in bumps/bruises (shades of grey torture??) and with no real concessions, bar the few extra months to "go and do some homework and come back" threat from Germany in particular.
They could see their banks at home running out of cash rapidly so they backed down on all their anti austerity gibberish and the boot seems to be on the other foot now, as despite the sound bites, the Germans have the means to force a Grexit at their disposal and they have made it clear this is far preferable to having all the other southern states cancelling their austerity reforms if the Greeks get any real concessions.
The Syriza rock stars now have to sell this to their electorate, having promised the earth they have delivered zippo so far. And perhaps collect a few taxes too... the Greek tax system is based on a series of colanders at present.
Perhaps they can brag about the pens they nicked from the hotels.... Its clear that Greek debt is far too high but their approach so far has been childish so back to square one guys... engage brains next time....
Re WLFE- yes big move there, perhaps some disillusioned over ORM surrendering their tungsten mine in Spain in that mysterious deal mid week has helped and the fact they aren't far off commissioning now, with the capex looking a bit under budget so far. The tungsten price moves weekly in a clunky manner, the market is small and so difficult to call future moves as the Chinese dominate so much of the production. Im happy to hold long here, but if there is corporate action then lets see.
Re PVR- so their preannounce a fund raising, which isn't good news re their Sequa deal timescales or their share price. 25p is mooted re a placing, they did have producing assets in the past but sold them so jettisoning cashflow and lining up this particular problem. If they need cash, they should move quickly as they have close to zero credibility now and some v angry shareholders. (Not me fortunately)
Cheers. The Leggie
Leggie, I'd be inclined to agree with you "had the EU been not so certain" of no discussions, no extensions, zip zilch, now a delay in the inevitable. Greece conform or have what? There's a critical point of unemployment and Greece aren't far from it anyway. Greece's opportunity if I'm honest is akin to the bondholders of Afren, being in the ashes of the former self.
ReplyDeleteLets see what Greece does, there was an agenda from the onset, and this has so far proven all the Greece has no choice pundits, validating the view of agendas and hidden default. Near a month ago, the odds of Greece were leaving the Euro were 1:5 now they're near 50/50 hmmm and on Friday they hit 65% probability.
PVR, I saw but had little time, they statement about a fundraising surely contradicts the farm out/in exercise or perhaps gives credibility to the suggestion there's more risks than PVR want to admit.
Glad you had a good day, I was flailing on my deathbed in between meetings.
Cheers F
Fraser- "Flailing in deathbed"- great description- very Byronesque- good thing you are not a horse :-))
ReplyDeleteRe Greece- Syriza were elected on a All Our Debts Gone and Free Money For All mandate, which was completely unrealistic but I guess it shows what happens when youth unemployment goes over 50% and the IMF and ECB continue to lend them money in such an ignorant manner- the Greek can has been kicked down the road for over a century now. They probably need to default, take the pain and restart again, but without a credible tax raising system it wont work. I have Grexit (which would now be isolated given most of the commercial banks have low exposure) as an almost certainty now but low contagion as it will have been signalled so far ahead. The ECB/Germans want to create an example for the rest of Europe and so no forgiveness/concessions for the rock stars, soon to be taking their place in Greek history for all the wrong reasons.
Hope you are better soon- did they have a FTML on Friday??
Cheers. The Leggie