The Greek Elections

Miscellaneous Current Events
1

This is what democracy is all about :

The pro-bailout New Democracy party came in first Sunday in Greece’s national election and could gather enough support to form a pro-bailout coalition to keep the country in the eurozone.

As central banks stood ready to intervene in case of financial turmoil, Greece held its second national election in just six weeks to try to select a new government after an inconclusive ballot on May 6.

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The projections showed New Democracy winning 29.5 percent and 128 seats. The radical left Syriza party, which has vowed to repeal Greece’s international bailout deal, was expected to come in second with 27.1 percent and 72 seats. PASOK trails with 12.3 percent and 33 seats.

To form a majority government, a coalition would need at least 151 seats.

The parties vying to win have starkly different views about what to do about the €240 billion ($300 billion) in bailout loans that Greece has been given by international lenders.

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Syriza head Alexis Tsipras, a 37-year-old former student activist, has vowed to cancel the terms of Greece’s international bailout deal and repeal its austerity measures.

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Earlier, the exit polls projected seven parties in all beating the 3 percent threshold for seats in Parliament, including the extremist right-wing Golden Dawn party, which vehemently rejects the neo-Nazi label but has been blamed for numerous violent attacks against immigrants.

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Tsipras, has vowed to rip up Greece’s bailout agreements and repeal the austerity measures, which have included deep spending cuts on everything from health care to education and infrastructure, as well as tax hikes and reductions of salaries and pensions.

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“We have beaten fear. Today we open a road to hope,” Tspiras said, adding that he was confident of victory. “Today we open a road to a better tomorrow, with our people united, dignified and proud. In a Greece of social justice and prosperity, an equal member of a Europe that is changing.”

Samaras, meanwhile, cast Sunday’s choice as one between the euro and returning to the drachma. He has vowed to renegotiate some of the bailout’s harsher terms but insists the top priority is for the country to remain in Europe’s joint currency.

“Today the Greek people speak. Tomorrow a new era for Greece begins,” Samaras said after voting in southern Greece.

http://finance.yahoo.com/news/greece-pro-bailout-parties-could-184929628.html

2

The comment is best left to the markets: this morning all European stock exchanges opened in full bull mode, then tanked around 10AM (Central European Time) and are all presently taking a beating except for Frankfurt.

It’s funny. Last week I was at my bank discussing some investment options and the nice girl following my portfolio said “No need to worry, it’s just a speculative phase: Europe’s fundamentals are sound”. I was about to crack a Blackadder Goes Forth quotation (“If nothing else works a total pig-headed unwillingness to look facts in the face will see us through”) but it would have been wasted.

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The comment is best left to the markets

Could you kindly translate what they are saying?

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Could you kindly translate what they are saying?

I believe it’s something along the lines of “AGGGRRRHHH!!!. It’s not happeing, it’s not happening, it’s not happening. AGGGRRRHHH!!!”. But my Marketerian isn’t what it used to be, so that might be a bad translation.

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It’s not happeing, it’s not happening, it’s not happening.

What do you mean by “it”? Why is 'it" not happening a cause for concern?

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When ‘it’ is something likely to make you go “AGGGRHHHHHH!!!”, I’m guessing.

7

In short after the usual initial mindless euphoria they are saying: “This is hopeless”. It means more “austerity” measures and more “bailout packages” in one form or the other, meaning more capital being devoured at a much faster pace than it can be created because even the most greedy speculator knows where the money will come from one way or the other.

One particularly disturbing sign is the German industry has slowed down in the first quarter of the year and things will probably get worse from here. Even Angela Merkel had to admit “Our strength is not infinite”. The German boom of 2002-2009 was built on exports to Club Med countries. With Spain in a battered state, Italy on the brink of a serious financial crisis and France in the hands of a bunch of “Punch Candidate for Guzzledown” type populists they are understandibly uneasy.

At this point a serious devaluation of the euro (call it what you will) is becoming more and more likely. Not because it will do any good but because it’s the last arrow left to shot. The Italians and French are strongly pushing for it, oblivious to the fact we are experiencing serious bouts of price inflation (the fallout from QEI and the “unlimited liquidity to banks” plans) . The Germans will cave in. Resisting means exiting the euro and short term pain as exports to Club Med will drop dramatically. That’s as easy as that.

Now excuse me but I have to plan accordingly.

8

Spot on. I read The Tragedy of the Euro and it explains the whole situation really well. The Germany - Southern Europe situation has similarities to US/Europe and China situation. One country does all the production and the other countries do all the consuming.