The Last Time Greece Did This, Its Stock Market Crashed 70%

Tyler Durden's picture

It was April 2014 and global equity markets were breathing a sigh of relief as Greece just returned to the international bond markets "proof that the country was recovering from the crisis." 18 months later, Greek stocks had crashed 70%, yields had exploded and bailout 3 (or 4) was necessary. Whichbrings us to today... WSJ reports that Greece Eyes Bond Sale Amid Optimism Over Debt Deal.

Here is the Boston Globe from April 11 2014:

Greece’s return to the financial markets with a five-year bond offering Thursday was met with overwhelming demand from investors, and government officials hailed the sale as proof that the country was recovering from a wrenching five-year economic crisis.


Greece raised $4.2 billion on an offering that attracted more than $27.77 billion in orders, the government said. The majority of buyers were foreign pension and investment funds, which received a 4.75 percent interest rate on the bonds.


The relatively low rate signaled a degree of renewed confidence in a country that only a few years ago was on the verge of exiting the 18-nation eurozone and saw the rates on its 10-year bonds exceed 30 percent. Ireland and Portugal, which also received international bailouts amid the crisis, returned to financial markets earlier this year.




The prime minister also thanked lawmakers in the governing coalition for having backed tough austerity measures despite their political cost, and Greek citizens for their sacrifices.


“Today, Greeks feel greater faith in themselves and in the future,” he said.

And then this happened...


And yields spiked from around 5 to over 17...

But Greek bond yields have collapsed to post-crisis lows in the last weeks as everyone and their pet rabbit is sure the bailout is a done deal..

Which brings us to today...

As Greek assets rally on optimism of a deal to restructure the country’s crushing debt, Greek government officials are planning a bond issue - the first by the country in three years - possibly as soon as July or September.


Earlier this month, Athens reached a deal with international creditors on fresh austerity measures that would unlock the next payment in its €86 billion bailout program ($93.48 billion).


But the bigger goal is a deal to restructure its €315 billion debt, possibly by stretching out maturities, capping interest rates and postponing interest payments.


The combination of a debt deal, Greece’s inclusion in the European Central Bank’s bond-buying program and a successful re-entry to capital markets could mark a turning point for the country’s economy, already nine years in depression.

Looks like Greek Creditors are about to find another set of greater fools...

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Raffie's picture

So don't do that if it caused a %70 crash.


Haus-Targaryen's picture

I remember back in the good-ol days of 2012 -- this kinda Greece story would generate 100,000 views (quite a feat for ZH at the time).  There would be 400 comments about what each and every piece of information means. 

Now everyone couldn't care less if they tried. 


Bill of Rights's picture

A crash they say....any day now.... 9 years later.



Sonny Brakes's picture

Who's writing these headlines? Is it Dave? Let's get into the...

medium giraffe's picture

Another summer BBQ in Syntagma Square?

Cordeezy's picture

It isnt crazhing just yet.


Cordeezy's picture

It isnt crazhing just yet.


debtor of last resort's picture

Time for "Belgium" to diversify.

Ghordius's picture

Greece is back online. A feat all for itself.
(Got to look what Varoufakis says about that. He supports Macron, I heard)

OverTheHedge's picture

If ever there was a country that had an overwhelming need for even more debt, that would be Greece.

GDP down by one quarter, and now running a primary surplus, which guarantees to kill the economy even faster. What could possibly go wrong?

I will be first in line for the new issuance. Not.

Ghordius's picture

< sigh > it's never enough. never

hello? it makes existing debt cheaper. and so it eases the issues

Haus-Targaryen's picture

Maybe you could talk about the primary budget surplus some more Ghordo?  

Keep talking about it -- maybe it sends some good vibes their way.  That is about all that figure does for the Greek state.  

JohnGaltUk's picture

It makes me laugh but not as much as the 100 year bonds that Portugal have been selling!!!

The average age of fiat currency is 63 years. The financial centres are full of young traders that have never seen a base rate higher than 5-6%, how will they know how to trade at 18 - 22%. Big lessons are coming to all concerned.

Wake up folks, governments are taking advantage of pension funds because by law they have to buy a certian amount of government bonds. This means they can sell pension funds any old shit. If its a government bond they stamp it AAA. Greece, Italy, Spain, France, Ireland and Portugal are NOT AAA, they are junk backed by a wink from Germany. This will NOT last.

dark fiber's picture

Greece will be online up until  the German election.  After that they pull the plug.

Haus-Targaryen's picture

I said the exact same thing 5 years ago. 

AnimalSpirits's picture

For those interested: Varoufakis has a new book out —- Adults in the Room.

rejected's picture

Another cuntry where the banks and 1% are doing well while the rest are in the poor house.

Sound familiar?

1.21 jigawatts's picture

Crack addicts sell crack to other crack addicts.

Tonterias's picture

Greece Up, for Dow Jones new record high