GREEN GREEN GREEN IN EUROPE ON MARKETS, AND GREEK RED RED RED.
Stock markets have been showing good numbers Globally the last couple of days.
In the London Stock Exchange, the FTSE-100 index gained 1.18% to close at 5447.79 points. The Frankfurt Stock Exchange also ended with a rise of 0.82% to 6144.22 points. The IBEX 35 of the Madrid Stock Exchange rose 0.30% to close at 6438.10 points. In Paris the CAC 40 gained 0.42% to 3071.16 points. In Milan, FTSE MIB index gained 0.88% to close at 13,545.32 points.
A number of reasons explain this behavior. First, after Mr Montoro, minister of Budget of Spain making an scandal on Spaniard Banks, the European Central Bank (ECB) and its leader Mario Draghi calmed down everyone by saying that they would support local banks.
EU has said that it cannot forecast when Spain is going to ask for help but in any case hopes that the Spaniard government can find a solution to their problems.
On the other hand European banks now captured the attention of investors globally, as they have in their portfolios close to 1.19 trillion dollars in securities with Spain, Portugal, Italy and Ireland debts, which exposed to losses in the event that Greece leave the euro.
Although lenders raised capital requirements and used the credit lines of the central bank to refinance some agents especially in southern Europe, banks remain vulnerable to infection that could come with a withdrawal of Greece from the Eurozone.
A possible take off from Greece in the euro zone will be a disaster could leave the door open to new massacres, evidently weaken the credibility of the euro and may result in the departure from Spain, Italy or even France , leading to dismantle the union.
Even Ben Bernake on his speech of Thursday said significant risk for US economy with the European situation.
After more than two years of preparation, credit institutions live their own risk: a massive flight of deposits and possible new default declarations in other highly indebted countries in Europe.
Although analysts calculate between 20 and 30% chances that Greece leaves the euro zone, remember that the chances increased after the traditional parties (those who agreed to the latest plan to rescue the troika-ECB, IMF and European Union) lost most of the vote in the May 6 election.
Given the position of failing to meet the fiscal commitments made by the previous government, the winning parties do not constitute a majority, has been necessary to convene a new round of voting for next June the 17th, as politicians majority had chosen not to form a government.
The political humors are hot, really hot at Athens, this week a Neo Nazy Politic attacked a communist party female punching her on the face on national tv.
For the first time since the crisis began in November 2009, European leaders and central bankers are talking openly about the possible departure of Greece to monetary union.