Breakingviews

Hugo Dixon: Greeks choose between bad and terrible

By Hugo Dixon
July 2, 2015

Voting “Yes” in Sunday’s referendum would mean Greece suffers at least two years of recession. Voting “No” would bring financial havoc in the short run followed by the return of the drachma, hyperinflation and deep-seated economic depression. The right answer is “Yes”.

Capital controls hit Greek economy at worst time

June 29, 2015

Closing the stricken state’s banks would be a disaster at any time of year. But Athens’ capital controls are kicking in just as one of Greece’s main drivers – tourism – hits peak season. Even if Greeks don’t leave the euro, 2015 will be a writeoff.

Euro is poor yardstick for euro existential stress

June 22, 2015

The Greek crisis is compromising FX traders’ reputation for being the first and fastest to react to big news. Currency market signals are currently so muddied that stocks and bonds are better barometers of investors’ views on how close Athens is to default or euro exit.

Hugo Dixon: The big fat Greek blame game

By Hugo Dixon
June 22, 2015

If Greece collapses, the biggest chunk of the blame will go to whoever behaves most unreasonably in the final stages of the current game of chicken. So both sides have an incentive to accommodate each other’s reasonable positions. Hopefully, they realise this.

Greece and creditors are not really far apart

By Edward Hadas
June 15, 2015

The brink keeps getting closer, but there’s agreement on broad principles. The fight is over 2 bln euros, 1 pct of Greek GDP and 0.02 pct of euro zone GDP. The damage from failure is many times larger. A deal can be done - if only politics and pride can be overcome.

Hugo Dixon: What sort of man is Tsipras?

By Hugo Dixon
June 8, 2015

The next days will define Greece’s PM. He must choose between saving his country and sticking with a bankrupt ideology. If he is brave and smart, he can secure a few more concessions from creditors and a goodish deal for Greece. If not, he will drag Greece into the abyss.

For bonds, crowds are more dangerous than Draghi

June 4, 2015

The ECB chief’s relaxed attitude to volatility is fuelling gyrations in euro zone debt markets. But Mario Draghi is only stating the obvious. Supposedly risk-free assets have become some of the most perilous. The biggest hazard for investors is being part of too big a herd.

Cult of central bank transparency is too powerful

May 26, 2015

Rate-setters around the world are in a bind. The zeitgeist demands they share every twist and turn of their deliberations. But too bright a light can be blinding. Hard talk is often best done in private. While some transparency is good, more is not always better.

Bankers get ammo but no ally in regulation tussle

May 22, 2015

Financiers unhappy with tougher regulation can cite new analysis from the BIS. The central banks’ own central bank says new standards will probably change how economies and markets work. But the BIS is firmly focussed on coping with the new paradigm, not returning to the old one.

EU growth surprises hide clear pattern

By Edward Hadas
May 13, 2015

Recovering Spain was still the GDP star in the first quarter, but traditionally strong Germany did no better than perpetually stagnant Italy, while France defied gloomy predictions and the UK disappointed. Behind the mix-up, the recoveries are real, but mostly slow and unsteady.