The dollar has risen to and for a short while pushed through 121.00 Yen/dollar and the EUR has fallen to and had remained for a while through 1.1100. However, not uncommonly, the dollar has stopped as these new “Big Figures” loom large, but the trends are clear: money is moving firstly to the US dollar and secondly it is moving to the “English speaking” currencies and it shall continue to do so for quite some long while into the future.
Regarding Greece, we shall firstly state once again that although the German people have no respect for their Greek “cousins,” seeing them as shiftless, lazy, un-creditworthy freeloaders (and this really is not a too-harsh view of how the German populace actually does feel toward their Greek compatriots; all one has to do is ask Mr. and Mrs. Schmidt of Germany and stand back and wait for the resulting tide of vitriol for when the bounds of political correctness are withdrawn the truest, but worst, feeling surface), the German political and industrial “cognoscenti” know that Germany needs to keep Greece in the EUR-zone in order to keep the € weaker than it would be otherwise. They know this because they also know that Germany’s economic fortunes lie with Germany’s export trade, and exporters shall always choose to err in favour of a weaker rather than a stronger currency. Hence, despite the citizenry’s antipathy toward Greece, the “cognoscenti” will do what they must to keep Greece in the EUR-zone, and in the end will allow for any and all methods of extending Greek debts.
Thus, these series of massive debt maturities that shall be coming one after another after another on through the summer shall always go to the 11th hour and 59th minute, and there will be great wailing and gnashing of teeth on the part of the Greek and German authorities, but in the end these debts will be extended and Greece will remain within the EUR.
Again, we shall say that were we Greek we would long ago have dropped out of the single currency; would have stood down from these debt maturities; would have defaulted on those debts and would have taken up our old drachma in order to give our industries the ability to be competitive in the world market through devaluation. But the choice…at least for the moment… is not Athens’ to make. The choice is being made in Berlin, in Dusseldorf, in Munich et al. The choice is being made by ThyssenKrupp; by Bayer; by Daimler; by Volkswagen; by Siemens, by the BMW Group and by BASF et al.