Tuesday, November 01, 2011

Grrrr – eeeeek

UPDATE: In a surprise move, the defence minister has proposed the complete replacement of the country's military chiefs of staff - the chief of the Greek National Defence General Staff and all the service chiefs (pictured below). It is understood that the personnel changes took many members of the government and of the armed forces by surprise. What did we say at the end of this piece? Was this to pre-empt a military coup?

UPDATE: "This was completely unanticipated ... It is not needed and it is just sort of an internal political thing," said John Canally investment strategist and economist for LPL Financial in Boston. "This vote in Greece is going to hang over the market for next week or so, unfortunately".

UPDATE: Stocks are falling even harder now on talk that the Greek government may be on the verge of collapse, says the WSJ Clog.

All 10 groups in the S&P 500 fell as financial and commodity shares had the biggest declines, says Bloomberg Morgan Stanley and Citigroup Inc. retreated more than 7.2 percent as a gauge of European lenders tumbled 6.7 percent. Alcoa Inc., Boeing Co. and Cisco Systems Inc. decreased at least 3.4 percent, pacing losses among companies most-dependent on economic growth. Baker Hughes Inc. sank 8.6 percent as earnings missed analysts’ estimates.

The S&P 500 fell 2.6 percent to 1,221.35 as of 12:15 p.m. New York time. The benchmark gauge for U.S. equities slumped 2.5 percent yesterday. The Dow Jones Industrial Average declined 277.68 points, or 2.3 percent, to 11,677.33 today.

"I just don’t get it", says Michael Mullaney, who helps manage $9.5 billion at Fiduciary Trust in Boston. "A Greek referendum is a very risky proposition. Everybody thought last week that this crisis was behind us on a near-term basis, but Europe is going to be front and center".

UPDATE: Caught unawares by his high-risk gamble, says The Irish Times, Merkel and Sarkozy have summoned Papandreou to crisis talks in Cannes tomorrow. They will push for a quick implementation of the bailout deal ahead of the G20 summit. And the Athens Stock Exchange has suffered its biggest daily drop since October 2008, with the general index shedding 7.7 percent.

The lines are 'umming, the Progressive Contrarian is being, er … contrarian, Helen warns that you should never play poker with Greeks, Ambrose is being Armageddon-ish and Bruno is saying that there has to be a three-fifths majority for a referendum, so it ain't going to happen. Mary Ellen Synon ruminates about Greece being chucked out of the euro, and says that can't happen either.

The Daily Wail has taken tits and bums off its lead long enough to tell us that the markets are in freefall, and that MF Global has gone bankrupt. Merkel is said to be stunned and Sarkozy "dismayed". From over the Atlantic, the New York Times is talking of the Greek government being plunged into chaos, with the prospect of a collapse that would not only render the referendum plan moot but likely scuttle — or at least delay — the bailout.

Everything is on hold now, waiting for the great Merkel to speak. But I've already written her speech. It's the title of this piece.