Enviar pesquisa
Carregar
Market Commentary
•
0 gostou
•
186 visualizações
K
kvezino
Seguir
Denunciar
Compartilhar
Denunciar
Compartilhar
1 de 4
Baixar agora
Baixar para ler offline
Recomendados
The Coming World Economic Crisis And How To Survive It
The Coming World Economic Crisis And How To Survive It
Sikandar Siddiqui, CFA, FRM
Greece in 2015
Greece in 2015
Hoang-Dang Bach
NJ Future Forum 2012 Flooding Linkin
NJ Future Forum 2012 Flooding Linkin
New Jersey Future
From supervision to resolution next steps on the road to european banking un...
From supervision to resolution next steps on the road to european banking un...
ManfredNolte
Final draft nghieu's presentation on disaster mitigation in vn (in tokyo's wo...
Final draft nghieu's presentation on disaster mitigation in vn (in tokyo's wo...
BDNghieu
Philippine debt (1)
Philippine debt (1)
joy000 renojo
AMBCC Financial Services
AMBCC Financial Services
Michael Hill
Martyn Parker - Country risk management and financial preparedness for disasers
Martyn Parker - Country risk management and financial preparedness for disasers
Global Risk Forum GRFDavos
Recomendados
The Coming World Economic Crisis And How To Survive It
The Coming World Economic Crisis And How To Survive It
Sikandar Siddiqui, CFA, FRM
Greece in 2015
Greece in 2015
Hoang-Dang Bach
NJ Future Forum 2012 Flooding Linkin
NJ Future Forum 2012 Flooding Linkin
New Jersey Future
From supervision to resolution next steps on the road to european banking un...
From supervision to resolution next steps on the road to european banking un...
ManfredNolte
Final draft nghieu's presentation on disaster mitigation in vn (in tokyo's wo...
Final draft nghieu's presentation on disaster mitigation in vn (in tokyo's wo...
BDNghieu
Philippine debt (1)
Philippine debt (1)
joy000 renojo
AMBCC Financial Services
AMBCC Financial Services
Michael Hill
Martyn Parker - Country risk management and financial preparedness for disasers
Martyn Parker - Country risk management and financial preparedness for disasers
Global Risk Forum GRFDavos
Honorary Minister Mohamed Najib Boulif - Moroccan risk management policy
Honorary Minister Mohamed Najib Boulif - Moroccan risk management policy
Global Risk Forum GRFDavos
Reto Schnarwiler - Regional insurance facilities for governments
Reto Schnarwiler - Regional insurance facilities for governments
Global Risk Forum GRFDavos
Subprime 08
Subprime 08
Achyut Menon "AK"
The Rural Sector in the Caribbean: IFAD´s Analysis
The Rural Sector in the Caribbean: IFAD´s Analysis
IFAD International Fund for Agricultural Development
Greece crisis
Greece crisis
Krishna Ghosh
Solvency ii News January 2013
Solvency ii News January 2013
Compliance LLC
August 2012 Gnostam Economic Commetary
August 2012 Gnostam Economic Commetary
Philip Corsano
Tp 11
Tp 11
DamasiaTeran
3L Research Institute_LIKE
3L Research Institute_LIKE
LIKE
AMishra WB Decentralization FinalReportDraft May 2015 v2
AMishra WB Decentralization FinalReportDraft May 2015 v2
Aashish "Aash" Mishra
Knowledge Transfer With Scrum
Knowledge Transfer With Scrum
guestefd8bc
HTAi 2015 - Knowledge Transfer in Brazil; Case studies from SUS Collaborating...
HTAi 2015 - Knowledge Transfer in Brazil; Case studies from SUS Collaborating...
REBRATSoficial
Knowledge Transfer at the Workplace
Knowledge Transfer at the Workplace
CommLab India – Rapid eLearning Solutions
A Knowledge Transfer Program
A Knowledge Transfer Program
Keith De La Rue
Greece emu
Greece emu
Ryan Cho
EMUDebtCrisis
EMUDebtCrisis
Luke Mariani
The Impact of the current Greek financial woes on the global econo.docx
The Impact of the current Greek financial woes on the global econo.docx
cherry686017
Vgis macro the pigs and the emu lost decade
Vgis macro the pigs and the emu lost decade
Fahd Rachidy
Economides -The Greek and EU crisis
Economides -The Greek and EU crisis
Themistocles Papadimopoulos
To the Point, No.6 - June 29, 2012
To the Point, No.6 - June 29, 2012
Swedbank
The causes of the debt crisis in Greece
The causes of the debt crisis in Greece
AlexanderKorvin
Greece lightening
Greece lightening
Olivier Desbarres
Mais conteúdo relacionado
Mais procurados
Honorary Minister Mohamed Najib Boulif - Moroccan risk management policy
Honorary Minister Mohamed Najib Boulif - Moroccan risk management policy
Global Risk Forum GRFDavos
Reto Schnarwiler - Regional insurance facilities for governments
Reto Schnarwiler - Regional insurance facilities for governments
Global Risk Forum GRFDavos
Subprime 08
Subprime 08
Achyut Menon "AK"
The Rural Sector in the Caribbean: IFAD´s Analysis
The Rural Sector in the Caribbean: IFAD´s Analysis
IFAD International Fund for Agricultural Development
Greece crisis
Greece crisis
Krishna Ghosh
Solvency ii News January 2013
Solvency ii News January 2013
Compliance LLC
August 2012 Gnostam Economic Commetary
August 2012 Gnostam Economic Commetary
Philip Corsano
Mais procurados
(7)
Honorary Minister Mohamed Najib Boulif - Moroccan risk management policy
Honorary Minister Mohamed Najib Boulif - Moroccan risk management policy
Reto Schnarwiler - Regional insurance facilities for governments
Reto Schnarwiler - Regional insurance facilities for governments
Subprime 08
Subprime 08
The Rural Sector in the Caribbean: IFAD´s Analysis
The Rural Sector in the Caribbean: IFAD´s Analysis
Greece crisis
Greece crisis
Solvency ii News January 2013
Solvency ii News January 2013
August 2012 Gnostam Economic Commetary
August 2012 Gnostam Economic Commetary
Destaque
Tp 11
Tp 11
DamasiaTeran
3L Research Institute_LIKE
3L Research Institute_LIKE
LIKE
AMishra WB Decentralization FinalReportDraft May 2015 v2
AMishra WB Decentralization FinalReportDraft May 2015 v2
Aashish "Aash" Mishra
Knowledge Transfer With Scrum
Knowledge Transfer With Scrum
guestefd8bc
HTAi 2015 - Knowledge Transfer in Brazil; Case studies from SUS Collaborating...
HTAi 2015 - Knowledge Transfer in Brazil; Case studies from SUS Collaborating...
REBRATSoficial
Knowledge Transfer at the Workplace
Knowledge Transfer at the Workplace
CommLab India – Rapid eLearning Solutions
A Knowledge Transfer Program
A Knowledge Transfer Program
Keith De La Rue
Destaque
(7)
Tp 11
Tp 11
3L Research Institute_LIKE
3L Research Institute_LIKE
AMishra WB Decentralization FinalReportDraft May 2015 v2
AMishra WB Decentralization FinalReportDraft May 2015 v2
Knowledge Transfer With Scrum
Knowledge Transfer With Scrum
HTAi 2015 - Knowledge Transfer in Brazil; Case studies from SUS Collaborating...
HTAi 2015 - Knowledge Transfer in Brazil; Case studies from SUS Collaborating...
Knowledge Transfer at the Workplace
Knowledge Transfer at the Workplace
A Knowledge Transfer Program
A Knowledge Transfer Program
Semelhante a Market Commentary
Greece emu
Greece emu
Ryan Cho
EMUDebtCrisis
EMUDebtCrisis
Luke Mariani
The Impact of the current Greek financial woes on the global econo.docx
The Impact of the current Greek financial woes on the global econo.docx
cherry686017
Vgis macro the pigs and the emu lost decade
Vgis macro the pigs and the emu lost decade
Fahd Rachidy
Economides -The Greek and EU crisis
Economides -The Greek and EU crisis
Themistocles Papadimopoulos
To the Point, No.6 - June 29, 2012
To the Point, No.6 - June 29, 2012
Swedbank
The causes of the debt crisis in Greece
The causes of the debt crisis in Greece
AlexanderKorvin
Greece lightening
Greece lightening
Olivier Desbarres
The euro zone crisis jkn-kini
The euro zone crisis jkn-kini
JK-tiger
Greece Crisis
Greece Crisis
nadi143
Understanding the Eurozone Crisis
Understanding the Eurozone Crisis
European Centre for Development Policy Management (ECDPM)
Eurozone
Eurozone
Alec Mitchell
Greece crisis
Greece crisis
Disha Sharma
merged_document
merged_document
Alec Mitchell
Eurozone crisis
Eurozone crisis
Heena Bakshi
The greek sovereign debt crisis
The greek sovereign debt crisis
Ankit Kumar
Econ greece economy ppt
Econ greece economy ppt
bw695x
What if-the-eurozone-breaks-up ? Finland’s exit of its own accord
What if-the-eurozone-breaks-up ? Finland’s exit of its own accord
Yannick Naud
Could grexit be just around the corner the european union is on the verge of ...
Could grexit be just around the corner the european union is on the verge of ...
AustralianInvestmentEducation
Euro Crisis
Euro Crisis
Raj Choubey
Semelhante a Market Commentary
(20)
Greece emu
Greece emu
EMUDebtCrisis
EMUDebtCrisis
The Impact of the current Greek financial woes on the global econo.docx
The Impact of the current Greek financial woes on the global econo.docx
Vgis macro the pigs and the emu lost decade
Vgis macro the pigs and the emu lost decade
Economides -The Greek and EU crisis
Economides -The Greek and EU crisis
To the Point, No.6 - June 29, 2012
To the Point, No.6 - June 29, 2012
The causes of the debt crisis in Greece
The causes of the debt crisis in Greece
Greece lightening
Greece lightening
The euro zone crisis jkn-kini
The euro zone crisis jkn-kini
Greece Crisis
Greece Crisis
Understanding the Eurozone Crisis
Understanding the Eurozone Crisis
Eurozone
Eurozone
Greece crisis
Greece crisis
merged_document
merged_document
Eurozone crisis
Eurozone crisis
The greek sovereign debt crisis
The greek sovereign debt crisis
Econ greece economy ppt
Econ greece economy ppt
What if-the-eurozone-breaks-up ? Finland’s exit of its own accord
What if-the-eurozone-breaks-up ? Finland’s exit of its own accord
Could grexit be just around the corner the european union is on the verge of ...
Could grexit be just around the corner the european union is on the verge of ...
Euro Crisis
Euro Crisis
Market Commentary
1.
February 2012 The Five
Stages of Grief Greece By: James Solloway, CFA, Managing Director, Senior Portfolio Manager Psychiatrist Elisabeth Kübler-Ross is best known for her theoretical model of The Five Stages of Grief, which holds that, when faced with a catastrophic loss, most individuals pass through five distinct emotional stages—Denial, Anger, Bargaining, Depression and Acceptance. Interestingly, Greece‟s experience as a member of the single-currency eurozone appears to be following a similar trajectory. There was profound denial of the problems surrounding Greece‟s long-term fiscal health as far back as the signing of the European Union‟s (EU) Maastricht Treaty in 1992. There has been widespread anger at the discovery that Greece‟s finances were in a worse state than believed, and at the austerity measures being demanded of Greece by the EU. Greece has been forced to bargain intensively with the EU and other parties since its troubles came to light, and the conditions imposed by those deals are now ushering in a period of economic depression. We continue to believe that the EU and Greece will eventually be forced to accept the latter‟s departure from the single currency union. Greece‟s experience as a member of the eurozone their liabilities and thus avoid running afoul of their treaty appears to be following a trajectory similar to the five obligations. These, measures, along with what Rogoff stages of grief. The first stage took place in 1992. described as “decades of low investment in [Greece‟s] 1 statistical capacity,” have created a climate of severe Stage 1—Denial mistrust between Greece and its fellow EMU members, which is reflected in the harsh austerity measures being In the Maastricht Treaty of 1992, EU member nations demanded by the EU. pledged to limit deficit spending and national debt levels. Fiscal conservatism has also been a key requirement for Once these shenanigans, and the significant damage membership in the single-currency Economic and done to Greece‟s finances by the 2008 global financial Monetary Union (EMU). On that basis, the admission of crisis, became apparent, denial quickly evaporated. This Greece to the EMU should have raised the eyebrows of was reflected in exploding yields on Greek government anyone who had studied the history of sovereign debt debt, as shown in Exhibit 1. defaults. As economists Carmen Reinhart and Kenneth Rogoff demonstrated in their book, This Time is Different: Eight Centuries of Financial Folly, the Greek government has been in default roughly 50% of the time since the nineteenth century, far more than any other EMU member. Greece‟s admission into the EMU was not just a matter of denial—it may also have involved a certain degree of deception. A small cadre of investment banks helped 1 create complex, structured agreements that allowed Kenneth Rogoff, “Can Greece Avoid the Lion?” Project Syndicate, Greece and other EU countries to obscure a portion of 2/3/2010, <http://www.project- syndicate.org/commentary/rogoff65/English>, accessed 2/13/2012 SEI / Commentary / ©2012 SEI 1
2.
Exhibit 1: Ten-Year
Government Bond Yields There has also been intensive bargaining among holders of Greek debt. As we have noted in previous commentaries, the decision to enforce a haircut upon private sector Greek debt holders (an IMF-imposed condition), while preventing it from being termed a default (presumably a condition of core EMU countries whose banks are heavily exposed to such an event), has had unintended but serious consequences. First, the ECB has remained adamant that it expects full payment on all of the Greek debt it has purchased—a somewhat peculiar demand, given that (1) the ECB is the sole institution that can create euro-denominated financial capital at will; (2) buying Greek assets at a discount and demanding full repayment constitutes a form of monetary tightening, all else equal; and (3) its demand for favorable treatment will tend to intensify anger and mistrust between official institutions and the rest of the eurozone economy. (The Wall Street Journal recently Stage 2—Anger reported that the ECB had softened its stance somewhat, and would exchange its Greek debt holdings Naturally, denial and deception gave rise to widespread for bonds issued by the European Financial Stability anger. Other EU and EMU nations are angry at Greece Fund, or EFSF, though details are still forthcoming.) for its failure to fulfill its treaty obligations. Greek citizens Second, if Greek debt is eventually discounted to a are angry at their politicians, and angry about having to significant extent, then other troubled eurozone endure substantial austerity measures imposed from governments can be expected to demand similar outside their political system. The most recent austerity concessions. In fact, Ireland has stated publicly that it is package, passed by the Greek Parliament this weekend, watching this aspect of the Greek negotiations closely. If has been met by renewed demonstrations and violence. other nations follow the path Greece is on, the result Press reports indicate that unrest has spread to many would constitute a much greater hollowing out of the parts of the country, and that as many as 80,000 eurozone‟s financial assets than a Greek default or protesters caused significant property damage in haircut, and the risk of such an event could cause Athens, with hundreds of injuries to both protesters and significant financial turmoil if suddenly and fully security forces. discounted in market prices. Stage 3—Bargaining Stage 4—Depression The Greek government has been actively bargaining As we observed in our most recent Economic Outlook, with the EU and other external parties, as well as its own “SEI has steadfastly believed from the start that any citizens, since it first formally asked for assistance in attempt to resolve the crisis, short of full fiscal union, a 2010. The measures agreed to in recent days took many massive transfer of aid, and socialization of national months to hammer out, and are required to prevent an governments‟ debt through the issuance of eurobonds outright default by Greece in late March, when a was likely to fail. The weakest members of the eurozone significant principal payment on its debt comes due. are simply too indebted and uncompetitive. Germany‟s Judging by the late-stage negotiations, mistrust and insistence that the periphery debtors deflate their way to frustration continue to influence participants‟ actions. For health is reminiscent of the eighteenth century practice example, after presenting a hard-won package of deficit of throwing a person into debtors‟ prison until he has reduction proposals to the European Commission (the worked off his obligations.” executive body of the EU), three additional conditions were imposed upon Greece: (1) the promised budget The demands from core EMU nations for Greece to cuts had to be specified in more detail; (2) the package deflate or „internally devalue‟ its way to competitiveness would have to be approved by the Greek Parliament have not abated in the most recent agreement, and the before being approved by the EU; and (3) Greece would inevitable result—depression—continues to be reflected have to provide a written guarantee that the measures in Greek economic statistics, such as the January will be enacted regardless of the outcome of national Purchasing Managers‟ Index, shown in Exhibit 2, which elections expected in Spring 2012. The hard line being measures the performance of the country‟s taken by the troika comprised of the EU, European manufacturing economy. Central Bank (ECB) and International Monetary Fund (IMF) is likely to fuel further anger in Greece. SEI / Commentary / ©2012 SEI 2
3.
Exhibit 2: Greece
Manufacturing PMI eurozone, however. As we noted in a December 2011 Commentary (“The European Union‟s „Fiscal Compact‟—More of the Same”), “We continue to expect that Greece will eventually exit the eurozone…Such news could cause market dislocation, at least in the short-term, but we do not believe it would spell the end of the euro. Instead, we expect the eurozone to remain intact as long as a majority of the citizens in EMU nations (and aspiring EMU members) believe it is in their interest to do so and are willing to pay the price. We would become more concerned for the euro if Italy or Spain started to seriously entertain the possibility of exiting, but at this point, there‟s no sign of that, and the latest agreement is clearly intended to prevent that from happening.” ® According to the Markit PMI report, “Greece‟s manufacturing sector remained deep in recession during In that same report, we also observed that the ECB was January, with output, new orders and employment all likely to play an increasingly active role: “The ECB is declining at severe rates…Remaining well below the likely to become more active if a slowing eurozone 50.0 no-change mark, the headline index signaled economy is reflected in falling price levels. While a deep another steep deterioration in operating conditions and recession and ongoing policy errors pose clear risks to extended the current period of contraction to 29 the euro‟s future, they are also likely to stimulate consecutive months.” additional summits and perhaps more forceful ECB interventions.” Under its new leadership, the ECB has Stage 5—Acceptance played a far more activist role since late 2011, with positive effects on eurozone markets. And as Exhibit 4 shows, the latest PMI price indices for the eurozone are Consistent with the Five Stages of Grief model, we quite dovish, providing the ECB with ample room to believe that the „fifth stage of Greece‟ will involve continue easing policy and to support the EMU‟s acceptance, by the troika and Greece and that the latter ongoing attempts to ring fence the larger economies of must depart from the single-currency union. Under the Italy and Spain. EMU‟s current institutional framework, the adjustments necessary to close Greece‟s competitive gap (shown in Exhibit 3) are simply too severe, and imposition of those Exhibit 4: PMI Output Price Indices measures too far outside of democratic processes, to endure long-term. Exhibit 3: National Competitiveness Rankings Our Funds SEI‟s fixed-income funds do not currently hold any Greek sovereign debt. That noted, the situation in Greece remains a concern due to the potential for contagion to other European countries. Our View We do not believe that departures by Greece or other periphery nations will lead to the collapse of the SEI / Commentary / ©2012 SEI 3
4.
This material is
provided by SEI Investments Management Corporation (SIMC) for educational purposes only and is not meant to be investment advice. The reader should consult with his/her financial advisor for more information. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. There are risks involved with investing, including possible loss of principal. SIMC is a wholly owned subsidiary of SEI Investments Company. The Centennial Group 511 South Washington Street Lansing, MI 48933 information@refertcg.com (800) 999-9350 THE CENTENNIAL GROUP & ITS AFFILIATES ARE INDEPENDENTLY OWNED & OPERATED. SECURITIES AND INVESTMENT ADVISORY SERVICES OFFERED THROUGH SECURIAN FINANCIAL SERVICES, INC. MEMBER FINRA/SIPC. CORPORATE OFFICE: • 511 SOUTH WASHINGTON AVENUE, LANSING, MI 48933 • WWW.CENTENNIALGROUP.COM• 800-999-9350 462617 DOFU 2/12 SEI / Commentary / ©2012 SEI 4
Baixar agora