‘Grexit’ was an overused term–mostly in 2012–that referred (shockingly) to a “Greek exit” from the Eurozone. I hate overused fad jargon just as much as the next person, but even I gave in. In fact, it was more like ‘in for a dime, in for a dollar” in this mid-June post which now incidentally serves as an excellent and quick history lesson for the current round of Eurodrama. Please read it HERE if you’re at all interested in what’s moving markets these days.
Fast forward to today, and Tsipras is back–now poised to be elected president. Last time we knew he was stupid or crazy or bluffing because he wanted Eurozone bailout cash but didn’t want to play by their rules. This time, he’s flat out dangerous because he still doesn’t want to play by the EU’s rules, but couldn’t give a damn about the cash.
In fact, Tsipras and co have already given up the bailout. He’s not planning on getting any more money from the EU. The catch is that he’s also planning on asking the EU (very very nicely, one would have to imagine) to pretty please cancel Greece’s gigantic debt burden. His reasoning? They did it for Germany in 1953.
But hey… at least the guy has some semblance of a plan this time. He’s not the same recklessly insane Tsipras we saw back in 2012–the one referred to by some as “the most dangerous man in Europe.” And that absence of reckless insanity is evident in the tamer market reaction compared to the Grexit’s salad days.
Bottom line, it’s obviously having an an effect, and that effect is obviously not very big. It’s a diversion, but valid.