Greece also has the issue of having fudged its own economic data on top of the significant deficit to GDP percentage violations. This may be a rally based upon hope and intuition as the markets reached oversold levels, or it could be the start of a resolution. Unfortunately getting credible data on procedures of how the European Union will actually conduct a rescue is a journey with more questions than answers.
National Bank of Greece SA (NYSE: NBG) is up almost 9% at $3.72 in late morning trade despite a very late downgrade from Goldman Sachs. For whatever it is worth, this one has traded as high as $3.89 today and the 52-week range is $2.09 to $8.37. Spain’s bank ADRs are up as well. Banco Santander, S.A. (NYSE: STD) is up 3.2% at $13.30 and Banco Bilbao Vizcaya Argentaria, S.A. (NYSE: BBVA) is up 3.1% at $13.48. We are seeing a very mixed bag in the Irish banks…..The Bank of Ireland (NYSE: IRE) up 0.6% at $6.65 and Allied Irish Banks plc (NYSE: AIB).
These are just the reactions of the ADRs today. The EU major markets all came off their highs well, with the FTSE up 0.3% and the DAX up 0.3%. The CAC in France was up but that went into negative territory. The ECB has maintained that before this week that it was not needed to conduct a bailout and that Greece would get its deficits and finances to comply. You need only to look at the tape to determine that the world has doubts about an organic resolution here.
This still brings up the question about to handle real sovereign debt risk. Not just in emerging countries… After our deficit projections inside the U.S. under the existing and 2011 budget and after we raised our debt ceiling, some of the issues of afar are issues we need to be sounding much louder in our own front yard.
JON C. OGG
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