Democracy and chaos are both Greek concepts http://t.co/rM8YS8CA
Democracy and Chaos are both Greek
It seems as if almost everyone was surprised by Prime Minister George Papandreou‘s decision to hold a referendum on the euro zone’s bailout package for his country. At the very least, it can probably be said that he is weary of being hammered from all sides — his own party, the opposition, the people on the street, Germany, the tabloid press, you name it.
A lot will obviously depend on what question is asked. Do you want an end to austerity, would get a clear yes vote. Do you want to leave the euro zone — perhaps not.
Financial markets, however, do not initially appear content to wait. Talk of an end-of-year rally is off the table (at least for now). It’s not exactly χάος (chaos) out there, but Papandreou’s experiment in δημοκρατία (democracy) has sent the whole euro zone project into a new, risky phase.
It was a typo, but RBS’s take on the Greek referendum this morning will have had some resonance:
“We view this as a major negative for Greece and the rest of the momentary union”.
Fabulous typo from RBS note on Greek referendum – “We thus view this as a major negative for Greece and the rest of the momentary union”.
Greek referendum send stocks tumbling. One broker says: “Kiss goodbye to the year-end rally”.
Έλα, Γεωργάκη. Τι έχετε κάνει; Τα χρηματιστήρια!
Greek vote plan sends world stocks tumbling
LONDON (Reuters) – Greece’s shock decision to hold a referendum on its euro zone bail-out package sent investors scurrying for safer investments on Tuesday, hammering stocks and punishing the euro.
It scotched any immediate expectations for an end-of-year stock rally.
An unexpected fall in PMI data for China’s manufacturers also hurt investor risk-taking sentiment as did Monday’s failure of U.S. trading firm MF Global Holdings Ltd due to euro zone debt exposure.
European stocks were down close to 3 percent and MSCI’s all-country world stock index .MIWD00000PUS shed 1.7 percent.
Greek Prime Minister George Papandreou’s announcement on Monday that he will put Greece’s bailout to a referendum immediately cast doubt on the euro zone’s plan to hand Athens 130 billion euros and arrange a 50-percent write-down on its huge debt.
It raised the possibility of a disorderly default on its debt if Greeks vote against the plan.
But more broadly it also threw into chaos the euro zone’s wider attempts to stop the debt crisis spreading to more significant economies such as Italy.
Greek vote plan sends stocks tumbling
LONDON, Nov 1 (Reuters) – Greece’s shock decision to hold a referendum on its euro zone bail-out package sent investors scurrying for safer investments on Tuesday, hammering stocks and punishing the euro.
It scotched any immediate expectations for an end-of-year stock rally.
An unexpected fall in PMI data for China’s manufacturers also hurt investor risk-taking sentiment as did Monday’s failure of U.S. trading firm MF Global Holdings Ltd due to euro zone debt exposure.
European stocks were down close to 3 percent and MSCI’s all-country world stock index shed 1.7 percent.
Greek Prime Minister George Papandreou’s announcement on Monday that he will put Greece’s bailout to a referendum immediately cast doubt on the euro zone’s plan to hand Athens 130 billion euros and arrange a 50-percent write-down on its huge debt.
It raised the possibility of a disorderly default on its debt if Greeks vote against the plan.
But more broadly it also threw into chaos the euro zone’s wider attempts to stop the debt crisis spreading to more significant economies such as Italy.
Investors cut stocks, buy U.S. debt in October: Reuters poll
LONDON (Reuters) – Investors were so concerned that euro zone leaders would not reach agreement on solving the debt crisis in October that they cut equity holdings to the second lowest level in 12 months, Reuters polls showed on Monday.
At the same time, bond holdings rose in October with most emphasis on U.S. debt, which is being boosted by the Federal Reserve’s new, quasi-quantative easing program.
Reuters surveys of 56 leading investment houses in the United States, Japan, Europe ex UK and Britain showed the average stock holding in a balanced portfolio was 49.5 percent, down from 50.5 percent in September.
Bonds rose to 35.9 percent from 34.6 percent while cash slipped to 5.9 percent, still the second highest level of the past 12 months after September’s 6.3 percent.
The polling was nearly all conducted before last week’s agreements by euro zone leaders on a three-pronged plan to attack the currency bloc’s debt crisis.
Given that U.S. economic data has been improving during the month and that stock markets are widely seen as offering value, the results reflect the extent of fear among leading investors that the euro zone would not act with enough vigor.
There remains residual concern even after the agreement, many of the details of which have yet to be hammered out.
PIMCO says portfolios should avoid longer dated issues where inflation premiums dominate performance
Reuters asset allocation polls also showed investors with large cash holdings in Oct — enough to feed a rally?
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