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| Greek decision tree from Barclays via alphaville / FT |
Main news of the day – IMF is suggesting that the ECB should also participate in the Greek restructuring, as possibly the debt level cannot be lowered enough with only haircutting private investors’ holdings. ECB does not like the idea one bit, but hey, IMF is more senior. The market week surprised just when I least expected it.
Attention all European national central bankers! Prepare to recap your holding company on three! One….Two….Recap!
Apple and FOMC – go read Seeking Alpha or Stocktwits. In here, real men discuss collateral shortages, ECB balance sheets and anything that can be stated in acronyms, as it will make us sound like Apollo astronauts – or at least McKinsey consultants. Just a short briefing list tomorrow morning, a full linkfest later in the evening.
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News (evening) – BTH
Recap – GMT
FX option vols – Saxo
Debt crisis: live – The Telegraph
Europe Crisis Tracker – WSJ
EURO CRISIS
George opens up on Germany, how euro bonds of some sort are needed to solve the crisis.
EURO CRISIS: GREECE
There are official creditors, and there are “official” creditors – alphaville / FT
IMF warns that even public creditors of Greece could have to participate in the restructuring, while ECB is (obviously) against it. IMF will not give more money before restructuring, so ECB will have to cave in, sooner or later.
IMF warns that even public creditors of Greece could have to participate in the restructuring, while ECB is (obviously) against it. IMF will not give more money before restructuring, so ECB will have to cave in, sooner or later.
Will the ECB take a haircut? – Credit Writedowns
While the ECB formally demands full repayment, since it bought the bonds at a discount, it could take some haircut notional and still be kept whole. The IMF, however, is less likely to accept a haircut, as it would likely fear the precedent.Oups, Just a small thing – Alea
Greece’s bilateral EU loans become immediately due and payable if it defaults on any bond.
OTHER
Just How Much Control Over Central Banks Do The People Have? – ZH
Morgan Stanley: The prohibition to buy at auction exists across the board but is practically not a very meaningful constraint on government financing, since the ability exists to buy in the secondary market.
Koo Concerned Keynesian Class Contracting – ZH
Nomura: Still, those calling for fiscal stimulus and not fiscal consolidation remain in the minority. When future historians write about this era, will they say that governments implemented mistaken policies that crushed their economies out of a fear of following in Greece’s footsteps, when in fact their circumstances were entirely different from those of Greece? The answer depends on whether we can free ourselves from the power of the Greek spell.
Everything You Wanted to Know About Credit Trading, But Were Afraid to Ask – TF Market Advisors
Very good article written in the form of a narrative story.
DIVERSION
The Machine-Tooled Happyland – Holiday Mag
Author Ray Bradbury visits the Disneyland, from Oct 1965
Greetings from Davos!!! – The Reformed Broker
Parody, at least I hope so!