Wednesday, January 27, 2010

Roubini: Greece Is Bankrupt

“Greece is bankrupt,” Nouriel Roubini told at WEF. “Look, they have to ask China to help them out.”

Greece is trying to get China to buy 25 billion euros ($35 billion) in bonds, according to published reports Wednesday.

If the situation becomes dire enough the European Union will be forced to help bail Greece out because it’s such a threat to the monetary union, Roubini said.

Note what Roubini is saying in this last comment: the EU will bailout Greece. This is not the impression EU leaders have been giving publicly. As the most wired in economist in the world is Roubini hearing things on background that the public isn't, specifically, if things come down to bankruptcy, the EU will bailout Greece?

It's a ballsy trade, but do you buy Greek debt if bankruptcy is near on the bet that the EU will bail Greece out?


  1. Wenzel,

    If the EU does bailout Greece, this sets up an epic moral hazard play. Not to mention the fact that it would completely undermine the entire rationale and strategy for fiscal austerity behind the guidelines for EU membership.

    I wonder if Turkey, seeing its own financial situation deteriorating, now steps up attempts to make it into the EU, hopefully just in time for a massive ECB bailout?

  2. If by "ballsy" you mean stupid I agree. Unless you are a true insider this trade is for chumps. By insider I mean like JMK when he made his money by trading British bonds while working for their treasury dept.

  3. I had a bit of fun with Roubini, Rubenstein, & Rajan's financial prognostications at Davos:

    Also, thanks for the Chris Cox info. I gave kudo's to you at the end of my piece:

  4. Ever since modern Greece was created Europe treat it as a sacred cow, why?
    Why Europe destroyed Macedonia ,Ravaged Macedonia, denied Macedonia? Germany, Italy, Bulgaria paid war reparations to Greece, but what did Macedonians in Greece get? Bugger all. 1946-1949 a new civil war to exterminate Macedonians from Northern Greece, why? Why don't you refund everything taken from Macedonians?
    Greece's policy to this day is:"Macedonians do not exist." Isn't that genocide? Do you take us for fools?

  5. Since 1980 when Greece entered EU all the aid given was used for anti-Macedonian propaganda and spreading of Hellenism. Politicians Clergy, military used the finance the way they wanted playing the super patriots and fighting Europe for more money, trading their ancient history and civilization which is equal Bull's Mitsotakis told Europe:" you should pay us rent for giving you the scientific language"? Ha,Ha,Ha, bull's

  6. Greece is using borrowed money to conduct its war of national expansion. Greece is at war with Turkey, Macedonia and Israel. Why Europe is blind? Why Europe tolerates this spoilt child to play with European money? Wake up Europe, and let Macedonia, Turkey in the EU. Why Greece should dictate to 30 EU countries what to do? Is there any sense?

  7. Is Macedonia Part of Europe?
    75% of Macedonia is part of Europe, 25% the Republic of Macedonia is excluded , thanks to Greece's Democratic right the infamous "Veto",

  8. Modern Greece is a spoilt child of Europe,because of France, while ancient Greece never existed.
    By elevating ancient Greece to divine heights, the Frnch illuminati elevate theselves. France from a bringer of liberty became a bringer of tyrrany. " Fraternite, Egalite and Liberte", became empty talks for the pigs. Badinter, the French European High Commissioner for the Balkans in 1990 declared:" The Republic of Macedonia fullfils all the criteria to become an independent state and to join EU and all world organizations".
    To this date thanks, to Greek opposition, Macedonia is still out of NATO and EU.
    Is this the type of European justice? Shame.

  9. Greece should stand on her two own feet and don't expect others to pay their bills.
    They spend the money for salaries and dodgy business, so they should be accountable.

  10. Greece and Spain won't pay back. This was a calculated Risk, and a Lesson for the Banking System. The only thing Germans can do is:
    REPOSSESS 170 Leopard 2AEX Battle Tanks from Greece, and 190 Leopard 2A6E Battle Tanks from Spain.
    U.S.A must REPOSSESS 170 F-16 Jet Fighters from Greece, … the rest is gone with the wind …forever …
    Greece must stop paying lucrative pensions with borrowed money, reform the free health care system, and cut down, 4 times the military budged.
    Greece’s problem is too much debt. Greece has a budget deficit of 12.7% of GDP – meaning that the country is spending 12.7% more than the value of one year’s economic output.
    Greece is no different to a serial credit card borrower who can’t pay back his loans. But just like a serial credit card borrower, as long as Greece keeps relying on borrowed money to fund itself, the problem won’t go away. It will just get worse.
    Don't worry; the ECB, the Fed or both will print the money.
    And all of us will share the pain, with our hard-earned money.
    Bad is never good until worse happens.
    P.S one in four Macedonian speak a language that Albanian UNDERSTAND. The rest speak a language that Bulgarian UNDERSTAND. Macedonia has not a national IDENTITY.

  11. Greece is not bankrupt