28 June 2015

Crunch time?

Is the Greek crisis nearing resolution?  I am beginning to doubt if there is a means by which the Greeks can avoid default.  And Tsipras' decision to hold a referendum next Sunday seems more like an act of defiance to throw in the teeth of EU finance ministers.

Meanwhile, Draghi and the ECB are between a rock and a hard place:
The ECB has been providing life support to Greece for months by supplying billions in liquidity to the Greek banks. If Draghi pulls the plug, he could be held responsible for potential riots on the streets of Athens and national unrest. If he keeps the funding channels open, he will be accused of acting illegally and overstepping his mandate by financing a eurozone government.
In all the circumstances, it is increasingly difficult to see how some kind of agreement could be patched together.

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