Greece Teeters, The World Watches
Dennis Gartman has been directly involved in the capital markets since 1974 and has been publishing his daily commentary, The Gartman Letter, since 1987. Mr. Gartman is a strategic partner with the AdvisorShares Gartman Currency Hedged Gold ETFs (GEUR & GYEN) and lends his institutional insight to educate advisors and investors about trading gold in different currency terms.
The US Dollar has soared following two important circumstances last Friday. Firstly, Consumer Prices rose a good deal more than had been thought likely, raising the possibility of the Fed moving to tighten monetary policy sometime in the not-too-distant future, and secondly Dr. Yellen make the boldest and clearest statement yet that the overnight fed funds rate almost certainly would be raised this year. Those events are a sign that the ground beneath the markets has shifted; that the tectonic plates are moving and that they are set to move again soon.
We note Greece and the EUR, paying special heed to the fact that the Interior Minister, Mr. Nikos Voutsis, said on Greek national television last weekend that Greece almost certainly will default on its loans to the IMF sometime in June. He minced no words. His statements cannot be misunderstood. They were and are that clear for he said that after four months of talks with the IMF and the other members of the Brussels Group that no progress has been made and that
The four installments for the IMF in June are €1.6 billion. This money will not be given and is not there to be given.
Calling the austerity programs demanded of Greece and of the Greeks a program of “asphyxiation,” Mr. Voutsis made it very clear that the government under Mr. Tsipras is not prepared to push ahead with further austerity.
We shall grant that Mr. Voutsis is from the Syriza Party’s very far left wing and we understand that he has no choice but to make statements such as this; but his sounds like a voice of reason when compared to people in the party even to his Left… men such as Energy Minister Panagiotis Lafazanis… who said over the weekend regarding the Brussels Group and the demands by that group of Greece that
These so-called institutions in the last four months have applied a drip-feed torture on the Greek people, one of the most horrible blackmail practices in world history at the expense of the country.
The Prime Minister, Mr. Tsipras, has tried to walk a path on the Left between men such as Mr. Voutsis and Mr. Lafazanis and the Brussels Group, but his path is becoming more and more tenuous in nature and the default clock is ticking ever louder.