These investors are getting killed in Greece

By Ivana Kottasova

 CNN Money

http://money.cnn.com/2015/05/21/investing/greece-investors-losses/

Meet the Greekoholics: The investors who are losing big money in Greece but can't kick the habit.

Most international investors shunned Greece a long time ago, scared off by its never-ending debt crisis. But a bunch of brave -- or possibly shrewd -- fund managers have defied the consensus and bet big on the country, which continues to flirt with default and exit from the euro.

They love it when things are not looking rosy.

The Way Out for Greece

21 MAY 21, 2015 12:01 AM EDT

By Konstantine Gatsios & Dimitrios A. Ioannou

Bloomberg

A widely told narrative of the economic crisis in Greece holds that it is the product of excessive austerity, imposed by arrogant outsiders who misread the situation. The only way out, the story goes, is to break the resulting recessionary spiral with a policy of fiscal stimulus.

This account doesn't stand up to scrutiny and needs to be countered if the current brinkmanship over Greece's bailout is to end well.

Greece should quit euro 'temporarily': Ifo's Sinn

Dhara Ranasinghe

2 Hours Ago

CNBC

Cash-strapped Greece should be allowed to leave the euro zone temporarily, the president of Germany's influential Ifo Institute for Economic Research told CNBC on Thursday.

Talk that Greece is on the brink of a debt default that could trigger its exit from the euro zone has grown this week. A senior ruling party official said on Wednesday that Greece would be unable to make a payment to the International Monetary Fund on June 5 unless it received more aid from its creditors.

Greek Finances to Stagger On Longer Than You Think

While Greece says a deal is near, the country has enough money to last weeks, maybe even two months.

 Bloomberg

by Ben Sills

1:16 PM EEST

May 19, 2015

Greece will probably struggle through June before finally running out of money in early July.

That's the assessment of economists at Bloomberg Intelligence, who concluded that Greek lenders have enough collateral to keep emergency funds flowing from the European Central Bank for another eight weeks, so long as policy makers don't tighten the terms of liquidity. Tax revenue may be enough to keep the government afloat for about the same amount of time, economists Jamie Murray and David Powell said in a research note. The 3.5 billion-euro ($3.9 billion) payment due to the European Central Bank on July 20 may be the end of the road.

Euro, bond yields tumble as ECB hints at faster pre-summer buying

LONDON | BY MARC JONES

Tue May 19, 2015 7:27am EDT

Reuters

The euro tumbled on Tuesday and the region's stocks and bonds jumped after the European Central Bank signalled it would speed up its 1 trillion euro bond-buying programme for the next two months ahead of an expected summer lull.

World stocks were already testing all-time highs after another jump in Chinese stocks and a record close on Wall Street, and European markets shot up after top ECB policymaker Benoit Coeure talked of adjusting the bank's buying programme.

Greece's Turn to Resist a Referendum

MAY 18, 2015 2:00 AM EDT

By Mohamed A. El-Erian

Bloomberg

In 2011, overwhelming opposition from Greece's European partners forced Prime Minister George Papandreou to withdraw a proposal for a referendum seeking a “clear mandate” from voters to carry out European Union-backed policies. Last week, the opposite scenario unfolded: Germany suggested that the Greek government hold a plebiscite on whether to accept creditors' demands for economic reforms or ultimately leave the euro zone. This time, however, it was Greece that demurred.

This role reversal reveals at least three consequential aspects of the changes, real and perceived, in the interactions between Greece and its European partners:

Greece’s Debt Battle Exposes Deeper Eurozone Flaws — Horizons

4:32 pm ET

May 17, 2015 EUROPE

By  MICHAEL J. CASEY

The Wall Street Journal

To understand why Greece and its creditors have failed to put its debt burden on a sustainable path, look beyond the headlines about the intransigence of the left-wing government in Athens and the tested patience of officials in Berlin and Brussels.

Blame lies with the monetary union’s flawed political structure, where a highly integrated financial system coexists with fragmented and unpredictable governance. That structure means it’s dangerous to assume that bigger eurozone economies such as Spain or Italy won’t also see a revival of investor concerns about their own debt levels when the European Central Bank ends its monetary support for the region’s bond markets.

Greece must choose between 2 catastrophes

The Guardian

LARRY ELLIOTT, THE GUARDIAN

MAY 17, 2015, 10:03 AM

Yanis Varoufakis rues the day when Greece joined the euro.

The Greek finance minister says his country would be better off if it was still using the drachma. Deep down, he says, all 18 countries using the single currency wish that the idea had been strangled at birth but understand that once you are in you don't get out without a catastrophe.

All of that is true, and explains why Greece is involved in a game of chicken with all the other players in this drama: the International Monetary Fund, the European commission, the European Central Bank and the German government.

Greek Endgame Nears for Tsipras as Bank Collateral Hits Buffers

Bloomberg

by Nikos ChrysolorasVassilis Karamanis

12:00 AM EEST

May 18, 2015

Greek banks are running short on the collateral they need to stay alive, a crisis that could help force Prime Minister Alexis Tsipras’s hand after weeks of brinkmanship with creditors.

As deposits flee the financial system, lenders use collateral parked at the Greek central bank to tap more and more emergency liquidity every week. In a worst-case scenario, that lifeline will be maxed out within three weeks, pushing banks toward insolvency, some economists say.

Greece Remains Defiant as It Seeks Deal With Creditors This Week

by Paul TugwellRebecca Christie

4:09 PM EEST

May 17, 2015

Bloomberg

Greece’s government said it won’t back down on election pledges to end austerity even while seeking to agree on a deal with creditors as soon as this week to unblock financing and avert a default.

“We’re striving for a mutually beneficial agreement by Friday,” Nikos Filis, spokesman for the parliamentary group of Prime Minister Alexis Tsipras’s Syriza party said Sunday in comments broadcast on Mega TV. “Our mandate from the Greek people is to reach an agreement where we stay in the euro area without harsh austerity measures,” he said, adding that “tough negotiations” will take place before a summit meeting of European Union leaders in Riga, Latvia, on May 21-22.

Germany urges Greece to undertake reforms to unlock funds

Sun May 17, 2015 9:09am EDT

BERLIN | BY MICHELLE MARTIN

 Reuters

German politicians kept up the pressure on Greece over the weekend to implement reforms, with Economy Minister Sigmar Gabriel warning Athens in an interview that a third aid package would not be on the cards unless the Greeks made some changes.

Greece is fast running out of cash and talks with its lenders have been deadlocked over their demands for Greece to implement reforms, including pension cuts and labor market liberalization.

Greek Prime Minister Rejects Further Austerity or Labor Changes

The New York Times

By NIKI KITSANTONIS

MAY 15, 2015

ATHENS — Greece’s prime minister, Alexis Tsipras, said in a speech on Friday that his government wanted a deal with the country’s creditors but that it would not enforce additional austerity measures, like further pension cuts.

Mr. Tsipras said Greece wanted a “unified agreement” that would restructure its huge debt, a thorny issue not on the agenda of the current talks.

Greece Aid Accord Looks Elusive as Tsipras Sticks to Red Lines

Bloomberg

by Paul TugwellChristos Ziotis

2:16 PM EEST

May 16, 2015

An agreement between Greece and its international creditors to unblock financing and avert a default looked elusive after Greek Prime Minister Alexis Tsipras said he won’t strike a deal at any cost.

“There’s no doubt that an agreement must be reached,” Tsipras said late Friday at a conference in Athens. “But those who think that the Greek side’s resistance can be tested or that its red lines will fade as time passes, would do well to forget it.”

Greece offers privatisation concession as Germany stays tough

Thu May 14, 2015 6:04pm BST Related: BUSINESS, IMF

ATHENS | BY RENEE MALTEZOU AND LEFTERIS PAPADIMAS

Greece on Thursday offered a concession to its international lenders by pushing ahead with the sale of its biggest port, Piraeus.

Greece has asked three firms to submit bids for a majority stake in the port, a senior privatisation official told Reuters, unblocking a major sale of a public asset as the EU and the IMF demand economic reforms from Athens.

Despite the conciliatory move, Germany's Bundesbank showed no sign of easing off on its hardline stance towards Greece.

Why Syriza Will Blink

Project Syndicate

Anatole Kaletsky

MAY 14, 2015 6

LONDON – Once again, Greece seems to have slipped the financial noose. By drawing on its holdings in an International Monetary Fund reserve account, it was able to repay €750 million ($851 million) – ironically to the IMF itself – just as the payment was falling due.

This brinkmanship is no accident. Since coming to power in January, the Greek government, led by Prime Minister Alexis Tsipras’s Syriza party, has believed that the threat of default – and thus of a financial crisis that might break up the euro – provides negotiating leverage to offset Greece’s lack of economic and political power. Months later, Tsipras and his finance minister, Yanis Varoufakis, an academic expert in game theory, still seem committed to this view, despite the lack of any evidence to support it.

Opinion: Why stock investors shouldn’t worry if Greece exits eurozone

MARK HULBERT

Published: May 13, 2015 5:01 a.m. ET

Market Watch

CHAPEL HILL. N.C. (MarketWatch) — Investors are needlessly worrying about the prospect of Greece defaulting on its debt and withdrawing from the eurozone.

Consider: If a Greek exit from the euro a “Grexit,” as this possibility is being called — were really a cause for worry, then why aren’t the recent British elections causing a huge panic? After all, the Tory Party’s resounding victory, along with its anti-European Union stance, is leading some to speculate that the U.K. could leave the European Union as soon as next year — a so-called Brexit.

Euro Pares Gains, Stocks Rise

Germany’s DAX, which is stocked with exporters, jumped as the euro slipped from its high

By JOSIE COX

Updated May 14, 2015 1:18 p.m. ET

The Wall Street Journal

The euro pared gains against the dollar in late trade Thursday, sparking a stock rally led by Germany’s DAX index, which is packed with exporters.

The Stoxx Europe 600 ended the day 0.6% higher, led by a more than 1.8% gain on Germany’s DAX and a 1.4% gain on France’s CAC.

The euro weakened slightly after European Central Bank President Mario Draghi said that the ECB’s vast stimulus efforts will remain in place “as long as needed” until officials are confident they will meet their inflation objective on a sustained basis. The ECB’s bond-buying program has sent the euro sharply lower since it was first announced in January.

The euro was trading around 0.2% higher at $1.138, but was down from $1.145 earlier in the day—its highest level since late February.

A stronger euro is generally seen as bad for companies in the eurozone that generate a big chunk of their revenue overseas. The dollar enjoyed a stellar start to the year but has reversed direction in recent weeks amid a number of disappointing U.S. data releases.

“There is no denying the performance of the U.S. economy is falling well short of expectations” and is pushing back bets for when the Federal Reservewill raise rates, which is weighing on the dollar, said Lee Hardman, an economist at Bank of Tokyo-Mitsubishi UFJ.

BNP Paribas strategists also said the dollar weakness was likely to continue in the near term but added they broadly expect the buck to recover as the Fed gets closer to raising rates.

Eurozone bond markets were mostly stable Thursday after a selloff in recent weeks.

The yield on the German 10-year government bond, or Bund, edged slightly lower on the day to trade at about 0.70%, having risen from its all-time low of 0.05% in late April. Yields rise as bond prices fall.

“The bond rout isn’t going away for the summer and will weigh on all asset classes,” said Nick Lawson, a senior trader at Deutsche Bank.

Peter Chatwell, a rates strategist at Mizuho, said investors were unlikely to start buying bonds again in a big way until the current patch of volatility subsides. “They are on the sidelines waiting for the market to calm down,” he said.

In commodity markets, Brent crude was around 1% lower in late trade at $66.65 a barrel. Gold was up 0.3% at $1,222 a troy ounce.

Write to Josie Cox at josie.cox@wsj.com

This may be a greater risk for Greece than default

CNBC

Dhara Ranasinghe

Greece's anti-austerity government may think it's being squeezed by its international lenders but that could be nothing compared to the pressure it faces from the country's voters, experts warn.

The left-wing Syriza-led government under Prime Minister Alexis Tsipras has said it would not rush into a referendum or snap election to secure public support for the unpalatable reforms it may need to introduce to secure more funds. But analysts say neither can be ruled out as Athens desperately tries to avert a bankruptcy.

Greece's Varoufakis says debt swap fills Draghi's 'soul with fear'

 May 14, 2015 10:10am EDT

ATHENS

Reuters

Repayment of what Greece owes to the European Central Bank should be pushed into the future, but it is not an option because it fills ECB chief Mario Draghi's "soul with fear", Greece's finance minister said on Thursday.

Yanis Varoufakis said Draghi, president of the European Central Bank, cannot risk irritating Germany with such a debt swap because of Berlin's objection to his bond-buying program.

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Και για να έχουμε το καλό ρώτημα στη φιλοκυβερνητική «Εφημερίδα των Συντακτών»: πότε ακριβώς έπρεπε να μάθουν οι Ελληνες ότι «φυγή καταθέσεων που κινήθηκε σε ομόλογα του εξωτερικού ή προς τα “στρώματα” ανέρχεται σε 30 με 35 δισ.»; Πριν χρεοκοπήσει η χώρα ή μετά; Δεν όφειλε να ενημερώσει η Τράπεζα της Ελλάδος έναν δημοσιογράφο, που έθεσε το ερώτημα, ότι «λείπουν 20 δισ. από τα χαρτονομίσματα που είναι σε κυκλοφορία»;