Default Now Or Default Later; Greece Still Withholding Critical Data

CDR’s Tim Backshall was on CNBC‘s “Strategy Session” this morning, discussing the key trends in sovereign products over the past few months, pointing out the declining liquidity in both sovereign cash and derivative exposure.

“Do they default now or default later.”

Tim Backshall


The most interesting observation by Backshall is the declining halflife of risk-on episodes, which much like the SNB‘s (now declining) interventions, are having less of an impact on the market, as ever worsening fundamentals can only be swept under the carpet for so long before they really start stinking up the place.

Tim Backshall

As Backshall points out in the interview, even the IMF now realizes that soon the eventual second domino will fall, and it is better the be prepared, than to have to scramble in the last minute as was necessary in May.

In other words, the storm clouds are gathering and only fools will invest in risk asset without getting some additional clarity on what is happening in Europe.

The bottom line as Backshall asks is: “do they default now or default later.”

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This is happening as Bloomberg report that “four months after the 110 billion- euro ($140 billion) bailout for Greece, the nation still hasn’t disclosed the full details of secret financial transactions it used to conceal debt” and that EuroStat still has not received the required disclosure about just how fake (or real) the Greek debt situation truly is.

One might certainly wonder just how bad – and unknown – the situation in Europe is…

EUR/USD (last 48 hours):

EUR/USD. (Red: On-balance Volume. Yellow: Relative Strength Index).

Related by the Econotwist:

Is Mr. Barroso Really Competent To Be President Of The EU?

Barroso: EU Has Survived The Economic Crisis

Dangerous Economic Misconceptions

Basel III And The Fawlty Towers

European Banks Hunting For EUR 1,65 Trillion

Morgan Stanley: Governments WILL Default

Brussels Tells Athens To Shut Up And Take The Pain

Flight to Mystery

Greece About To Enter The Death Spiral

Germany’s Manic Depression

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