The markets seem to believe all the dazed ministers etc that the Greek PSI talk will eventually be successful and palm off a disorderly default of Greek debt. The situation presents a tail risk, and markets have ignored a chance of this happening. The argument for ignoring it is the opinion that the impacts would be far too mad for the Euro zone not to do whatever it takes to avoid this. However, given the regular incompetence of the Greeks every step of the bloody way – you cannot simply assume that definitely won’t end in tears!
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