Want to earn 60% p.a. EUR guaranteed by the ECB?
Greece is on the verge of collapse. Whatever that means. What it means to us is opportunity. While the euro politicians flap about trying to stop the contagion and wondering why they have once more been duped by Athens, Greek long dated debt is looking very attractive indeed. But beware. A bit like when you go on a dating website and there is a real hottie and you cannot believe your luck. But after some impressive emailing it turns out to be a hairy biker and it will be you getting the haircut. Big yields mean buyer beware of not getting your capital back.
This debt is junk or is it (telegraph)? Will the ECB really allow Greece to default? And if it does, it would be a temporary measure surely? But this is the wrong tree to bark at as this return is peanuts and only a mad fool would buy it (like BarCap for example). And that's why the best bet is on Greek bank deposits.
There are Greek banks (wiki) offering customers 60% p.a. 30 day liquidity. I kid you not. They are not advertising this but they are trying to lock in their existing customers. These banks need capital and are paying for it. Banks aren't going to go bust on the ECB's watch so get out there now and open an account at your local Greek bank. The Greeks like negotiating so ask for silly returns and short term lock in periods.
What will happen to Greece?
The main risk to Greece is it being removed from the Euro. This is highly likely and plans are afoot to use Greece as a test country. So it is very likely we will soon have a two tier Euro. South Africa and China have had 2 currencies so why not the Eurozone? So the threat is you deposit EUR and get back a new currency. However, the ECB is slow and dithering so you probably have about 6 months.
Greek man tells William what to do on his honeymoon night (mandc)
Wonga.com to buy out Citigroup (ft)
Bank of Uselessness stares motionless into the big truck's headlights (reuters)
US government to nationalize Standard & Poor (bloomberg)
Greece to force the UK's royal family back to Greece, assets and all.