(DE) Over in Germany, Fin Min Schaeuble has hardened his rhetoric on Greece, suggesting Athens government needs to stop asking for help and do more than it has.
(ES) Spain Econ Min De Guindos: Formally sends letter to Eurogroup to request recapitalization aid for its banking sector (Note: No specific amount listed).
How to interpret these new developments?
I mean the old saying “Give someone an inch and he’ll take a mile” is true in this case, especially with the Greeks. Just as the EU leaders were opening up for renegotiation just to avoid a “Grexit”, the new coalition Greek government drops a bomb and practically asking for the world, and in the process, prolonged the European Economic Uncertainty and drove the global market lower on risk aversion. A 2 year extension on jobless benefits? Who is going to pay for that? Do you think the Germans are going to be happy about that? Well, apparently the Greeks don’t care, and we shall see a very interesting EU Summit this week.
All in all I believe uncertainty is back in Europe. The situation has improved from an imminent Greek exit, but not for much better. With the negotiation possibly hitting an impasse, Euro could suffer in the progress… I’d be staying out of the Euro for the time being, waiting on more news… although I am still optimistic in the Euro as both Greece and Spain problems are solvable.
European Economic Uncertainty Looms Over The Market
June 25, 2012 by 2 Comments