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  • 2015 - Greece drops Euro?

    Russia still survives despite food economic sanctions and ruble falling 50%. As did Iceland.

    Greece can't be in a worst position than Russia which faces food shortages.

    If plan A can't work, maybe it's time to consider plan B.

    http://money.cnn.com/2012/05/07/mark...eece-eurozone/
    Last edited by touchring; 12-29-14, 09:56 PM.

  • #2
    Re: 2015 - Greece drops Euro?

    Originally posted by touchring View Post
    Russia still survives despite food economic sanctions and ruble falling 50%. As did Iceland.

    Greece can't be in a worst position than Russia which faces food shortages.

    If plan A can't work, maybe it's time to consider plan B.

    http://money.cnn.com/2012/05/07/mark...eece-eurozone/
    I put the chances of a Grexit at virtually nil.

    Greece needs cash coming in to its economy. There would be no faster way to chase away investment, including Chinese and other international funds looking to invest in seaport, airport and other infrastructure improvements, than the uncertainty of some form of Greek exit. Nobody will touch the place in that scenario.

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    • #3
      Re: 2015 - Greece drops Euro?

      Originally posted by GRG55 View Post
      I put the chances of a Grexit at virtually nil.

      After exiting IRE, I've been watching NBG, it has been performing badly this year and is now at record low.

      But it could double in the matter of weeks if Grexit fears are gone. Or it could halve if sentiments worsen.

      https://www.google.com/finance?q=nbg...Oo_rkAXZ2ICgBg

      Comment


      • #4
        Re: 2015 - Greece drops Euro?

        Originally posted by touchring View Post
        After exiting IRE, I've been watching NBG, it has been performing badly this year and is now at record low.

        But it could double in the matter of weeks if Grexit fears are gone. Or it could halve if sentiments worsen.

        https://www.google.com/finance?q=nbg...Oo_rkAXZ2ICgBg
        Looks like a very interesting speculation touchring.

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        • #5
          Re: 2015 - Greece drops Euro?

          If history is any guide the best thing Greece could do for the share market to go skyward is, precisely, grexit followed by a steep devaluation of the Dracma or whichever name the new currency would get, a default on it's debt followed by a non amicable restructure with a haircut in the 70% (or even more) range.
          That was Argentina solution. Merval went from the 300 range around end of 2001-2003 (when Nestor Kirchner put in place the debt restructuring with a 65% haircut) to the 1700 range in 2005-2006. It reached about 12500 in sept. 14 and has now fallen sharply to 8500. Anyway in 3 years, more or less, it was a 5 bagger. Those who waited longer were fairly rewarded. Meantime mainstream economists kept talking about the Argentinian economic "disaster". Merval graph is on http://finance.yahoo.com/echarts?s=^merv+Interactive#{%22range%22%3A%22max% 22%2C%22scale%22%3A%22linear%22} to complicated for me to copy-paste. I checked GREK, still way up the 2012 low of about 9.

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          • #6
            Re: 2015 - Greece drops Euro?

            I don't expect Tsipras, if he wins, shall perform grexit. He doesn't seem to have Kirchner's balls.
            Last edited by Southernguy; 12-30-14, 07:32 AM.

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            • #7
              Re: 2015 - Greece drops Euro?

              Originally posted by touchring View Post
              After exiting IRE, I've been watching NBG, it has been performing badly this year and is now at record low.

              But it could double in the matter of weeks if Grexit fears are gone. Or it could halve if sentiments worsen.
              Not my cup of tea but the right play here for gambling on a quick up move with limited downside risk will be the Feb 20 $2 calls at 18 cents. For those that don't play Wall Street roulette, that would allow one to control 5,000 shares of NBG for $900 instead of putting nearly $9000 at risk. You could buy an extra month for an additional 4 cents a share.

              What I don't like about this idea is that the upside should be limited to revaluation at book which is only a bit over $3 a share or ~5:1 upside in this trade. I'd like to see 15-20:1 on something this risky.

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              • #8
                Re: 2015 - Greece drops Euro?

                Originally posted by santafe2 View Post
                Not my cup of tea but the right play here for gambling on a quick up move with limited downside risk will be the Feb 20 $2 calls at 18 cents. For those that don't play Wall Street roulette, that would allow one to control 5,000 shares of NBG for $900 instead of putting nearly $9000 at risk. You could buy an extra month for an additional 4 cents a share.

                What I don't like about this idea is that the upside should be limited to revaluation at book which is only a bit over $3 a share or ~5:1 upside in this trade. I'd like to see 15-20:1 on something this risky.

                Hi santafe2, thanks for warning. I've been watching this stock for 3 years and it keeps dropping. It has been on a downward trend since the end of 2007! Is Greece becoming a second Japan?

                https://www.google.com/finance?chdnp...MsSxkAWZsYGwCA

                Comment


                • #9
                  Re: 2015 - Greece drops Euro?

                  Originally posted by GRG55 View Post
                  I put the chances of a Grexit at virtually nil.

                  Greece needs cash coming in to its economy. There would be no faster way to chase away investment, including Chinese and other international funds looking to invest in seaport, airport and other infrastructure improvements, than the uncertainty of some form of Greek exit. Nobody will touch the place in that scenario.
                  i think you've got it backwards. the uncertainty remains UNLESS greece exits the eurozone. once they've exited, they're in negotiations with the troika to write down their debt, their economy readjusts to its new, cheap currency, and the cost of operating in greece goes way down. not to mention, one need no longer worry about any pesky regulations emanating from brussels.

                  Comment


                  • #10
                    Re: 2015 - Greece drops Euro?

                    Originally posted by touchring View Post
                    Is Greece becoming a second Japan?
                    Greece would be happy to be a 2nd Japan.

                    Comment


                    • #11
                      Re: 2015 - Greece drops Euro?

                      Originally posted by jk View Post
                      i think you've got it backwards. the uncertainty remains UNLESS greece exits the eurozone. once they've exited, they're in negotiations with the troika to write down their debt, their economy readjusts to its new, cheap currency, and the cost of operating in greece goes way down. not to mention, one need no longer worry about any pesky regulations emanating from brussels.
                      "If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem." J Paul Getty.

                      Comment


                      • #12
                        Re: 2015 - Greece drops Euro?

                        Originally posted by jk View Post
                        i think you've got it backwards. the uncertainty remains UNLESS greece exits the eurozone. once they've exited, they're in negotiations with the troika to write down their debt, their economy readjusts to its new, cheap currency, and the cost of operating in greece goes way down. not to mention, one need no longer worry about any pesky regulations emanating from brussels.

                        I must admit that I'm not well versed with Greek politics. Let's say the anti-austerity party will win and it will be an excuse to try to renegotiate for the terms of the bailout, wouldn't it?

                        Comment


                        • #13
                          Re: 2015 - Greece drops Euro?

                          Originally posted by jk View Post
                          i think you've got it backwards. the uncertainty remains UNLESS greece exits the eurozone. once they've exited, they're in negotiations with the troika to write down their debt, their economy readjusts to its new, cheap currency, and the cost of operating in greece goes way down. not to mention, one need no longer worry about any pesky regulations emanating from brussels.
                          I live in Greece. I'll take the pesky regulations from Brussels over the Byzantine, expensive, and nonsenical Greek regulations any day. Heck, here in Greece, bureaucrats and white collar professionals never have a firm grip on the law because it's either constantly changing or its too nebulous. In that situation, it's well known that a payola usually clears things up... until the government changes yet again and you have a new set of bureaucrats (with their own interpretations of the law) to deal with.

                          I can't emphasize enough that Greece needs to be a ward of Europe. It's not ready to self govern. Period. And this view I'm espousing is from living here. My view has evolved over the past four years.

                          I said it before. In theory yes, a drachma would work. But Greece isn't ready for it. When China invests in Greece, it invests because Greece is strategicaclly located and it is part of the EU, not because of its faith in the Greek government.

                          Overall, yes, Greece has suffered immensely under the austerity paradigm. Nonetheless, Greece has also benefited from many requirements imposed by the troika - the breakup of monopolies (guilds), the ridiculous ever lowering of the retiree age, the money stuffed envelopes at hospitals, etc... Yes there is austerity, but yes, there is also a slow evolution to better, more honest and efficient government due to the troika.

                          Furthermore, Europe must be united - monetarily, militarily, culturally... in order for all the countries to succeed individually. It's a long process, but it needs to be done... for many reasons, although that's another topic...

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                          • #14
                            Re: 2015 - Greece drops Euro?

                            Originally posted by gnk View Post
                            I live in Greece. I'll take the pesky regulations from Brussels over the Byzantine, expensive, and nonsenical Greek regulations any day. Heck, here in Greece, bureaucrats and white collar professionals never have a firm grip on the law because it's either constantly changing or its too nebulous. In that situation, it's well known that a payola usually clears things up... until the government changes yet again and you have a new set of bureaucrats (with their own interpretations of the law) to deal with.
                            this is the way much of the world operates all the time. most of the world doesn't work like western europe, the u.s., etc. of course you have to pay off the new set of bureaucrats, that's their income stream. greece is ready to be more like a relatively democratic third world country. it isn't close to ready to be a first world country, where the graft and payoffs are systematized and officially run through the currupt political system in a more impersonal way.

                            I can't emphasize enough that Greece needs to be a ward of Europe. It's not ready to self govern. Period. And this view I'm espousing is from living here. My view has evolved over the past four years.

                            I said it before. In theory yes, a drachma would work. But Greece isn't ready for it. When China invests in Greece, it invests because Greece is strategicaclly located and it is part of the EU, not because of its faith in the Greek government.
                            and when china invests in zimbabwe or tanzania or nigeria, do you think they worry about the domestic political process, such as it is? they just make sure the right people are paid off.

                            Overall, yes, Greece has suffered immensely under the austerity paradigm. Nonetheless, Greece has also benefited from many requirements imposed by the troika - the breakup of monopolies (guilds), the ridiculous ever lowering of the retiree age, the money stuffed envelopes at hospitals, etc... Yes there is austerity, but yes, there is also a slow evolution to better, more honest and efficient government due to the troika.
                            good. those changes will help greece whether it's in or out of the eurozone.

                            Furthermore, Europe must be united - monetarily, militarily, culturally... in order for all the countries to succeed individually. It's a long process, but it needs to be done... for many reasons, although that's another topic...
                            that is indeed another topic, and a big one. the "convergence trade" of assuming that greek interest rates should close the gap with german ones made some people a lot of money. then it became clear that germany wasn't ready to pay greek debt, and we got the divergence trade. it's not at all clear that spain or italy, or even france, can be in some unified system with germany and holland. it would be an even greater journey for greece. i think greece entering the eurozone on the basis of [goldman flavored] cooked books was a big mistake. it appears to me that greece would do better now to admit that it made a mistake, withdraw from the eurozone and undergo its own political and economic evolution. perhaps the day will come when eurozone membership makes sense for greece. but i don't think that time is now.

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                            • #15
                              Re: 2015 - Greece drops Euro?

                              Originally posted by jk View Post
                              ...and when china invests in zimbabwe or tanzania or nigeria, do you think they worry about the domestic political process, such as it is? they just make sure the right people are paid off.


                              ...
                              Perhaps there is a difference? In sub-Saharan Africa the Chinese appear to be after what resources they can extract from those nations, and what equipment and surplus labour they can export and install to achieve that.

                              Unless the Chinese have suddenly developed a taste for olive oil over the traditional peanut oil in their woks, in the case of Greece it would seem they wish to invest in the infrastructure as one gateway for their products into the European market. A Grexit would seem counterproductive in that situation.

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