Archive - Jun 6, 2011

It seems that some Germans are finally realizing that the way the second Greek bailout package is proposed, will likely never work due to the required voluntary acceptance of 100% of bondholders which gives an essentially infinite value to the nuisance factor of holding out. We were thus not surprised to read overnight that Germany has now once again directly contradicted Juncker's comment from Friday that Bailout #2 was agreed upon "in principle." As Goldman explains: "CDU/CSU floor leader Kauder said in an interview with Bild Zeitung that "it has not been decided yet whether there will be another help package or not". CSU head Seehofer said over the weekend that the approval of the Bundestag was not a given; though it is not even clear whether the Bundestag has to approve another package, depending on which sources are tapped for the program." Look for many more such headline whipsaws as one after another piece of news comes out, now that the troika realizes its last ditch house of cards has finally toppled.

A snapshot of the European Morning Briefing covering Stocks, Bonds, FX, etc.
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