The EU comes through for Greece...for now
April 12, 2010
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Yes, we were in Greece not too long ago and we wrote the following observation in our debrief (Global Gains membership required) upon returning home:
We learned that the rest of the members of the E.U. are more committed to preserving the union than some their political rhetoric would indicate.
Thus, we were among the minority not surprised by the announcement over the weekend that the EU would be stepping up with a more than $40 billion aid package -- and potentially more -- to help the country to help it handle its debt load. Now, there are still some issues to work through such as how the money will be disbursed and if Greece will be able to successfully implement its austerity plan, but it's clear that the political will to preserve the EU is stronger than we and others initially thought.
That said, this is good news for Greece and buys the country time to get back on firmer financial footing. Further, we stand by our opinion that there remain a few choice opportunities among Greek equities despite our continued bearish stance on the euro. One reason for this is that ratings agency Fitch continues to downgrade all things Greek. Why ratings agencies still have any clout is beyond me -- as has been shown time and time again over the past few years they're slow to act, backward looking, and easily manipulated.
So keep your eyes on Greek opportunities because our variant perspective is that this will ultimately play out better than the market thinks it will. And if you're interested in our specific picks, check out our premium special report, 3 Plays to Profit From the Greek Crisis.
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