Η χρεωκοπία έρχεται, μόνο που δε θα γίνει με τους δικούς μας όρους

Η χρεωκοπία έρχεται, μόνο που δε θα γίνει με τους δικούς μας όρους

Posted on 22/05/2010 by imwrong

Εκτός αν η κοινωνική αναταραχή γεννήσει μια νέα πολιτική δύναμη. Ας έχουμε τα μάτια μας ανοιχτά.

επισκεφθείτε το site

http://blogs.wsj.com/economics/2010/05/22/number-of-the-week-75-chance-of-greek-default/

WSJ BLOGS

Real Time Economics

Economic insight and analysis from The Wall Street Journal.

Developers Tax Themselves to Build Infrastructure

MAY 22, 2010, 5:00 AM ET

Number of the Week: 75% Chance of Greek Default

75%: The probability of a Greek default by 2015, according to the credit markets.

Financial markets around the world are gyrating as investors try to assess the likelihood and potential repercussions of a Greek default. But if you believe the signals coming from one corner of the credit markets, that default is all but a matter of time.

The 750-billion-euro rescue package put together by euro-zone governments and the IMF is more than adequate to cover the

immediate needs of Greece, Portugal, Spain and other fiscally challenged European governments. All together, those governments need no more than about 288 billion euros through the end of this year even if investors refused to lend them

another cent.Beyond that, though, the situation gets dicier — a reality reflected in the market for sovereign credit-default swaps, where players bet on the likelihood of defaults by buying and selling insurance contracts that pay off if a government reneges or restructures its debt.

As of Friday, indicative prices in the credit-default-swap market suggested it would cost about $830,000 a year to insure $10 million in Greek debt through July 2011. If the loss in the event of a default would be about $3 million — i.e., bondholders would get back 70% of their money in a debt restructuring –– that means the market sees a 26% chance that Greece will renege by July of next year. By July 2015, that market-implied default probability rises to about 75%, compared to about 4% for cash-rich Norway.

AFP/Getty Images

Greece has seen protests of austerity measures needed to reassure investors.

To be sure, credit-default swaps are far from a perfect indicator. For one, very little trading occurs in the market,

allowing a few players to have a big impact on prices. Also, there are many so-called “technical” factors, such as banks’ hedging needs, that can push prices to levels that do not reflect actual default risk.Still, credit-default

swaps have done a pretty good job of predicting trouble in the past. They started flashing warning signs, for example, even as the stock market kept rising in early 2007. This time around, they could again be telling us something we need  know.