Brit Euro Shock Horror: Part II
A week ago we ran a post on MacroScope noting, in part, that Britons have a strange relationship with the euro, sometimes bordering on disbelief that it exists at all. Some new numbers from the monthly Bank of America Merrill Lynch fund managers poll underline the extent of UK scepticism compared with that of others.
For two months, BofA Merrill has asked fund managers around the world what they think will eventually happen as a result of the Greek debt crisis. Four choices are on offer:
1) The Greeks will sort it out themselves
2) The European Union will bail Greece out
3) Greece will default or restructure in an orderly manner and remain in the euro zone
4) Greece will default in a disorderly manner and exit the euro zone
Guess which region’s/country’s fund managers have been most likely to predict that Greece will leave the euro zone. You’re right — Britain.
Globally, the March poll shows 24 percent of respondents reckoning Greece will handle the debt problem itself , 52 percent seeing an EU bailout and 19 percent betting on an orderly restructuring. Only 2 percent predict default and euro zone exit.
Among British fund managers, however, 11 percent reckoned Greece was headed out of the euro zone. Back in February, this number was 22 percent. No other region/country comes close. No U.S. fund managers, for example, voted for the exit outcome.
It begs the question whether British investors and analysts know something that others do not. Or perhaps they are being influenced by decades of political and media scepticism. If the latter, is there not a danger of making the wrong financial decisions?