The chart below shows the same measure, but just over the past 18 months. The trend is unmistakable.
Why this decoupling? One explanation I have heard is that investors see the troubles in Greece more as a political crisis than a financial one. Financial crises, such as the one that rocked the world in 2008, tend to more directly affect financial institutions that span multiple regions. Political crises, on the other hand, are less likely to spill over borders. Or so the theory says. Personally, I have difficulty seeing the difference between the two types of crises in this case.
This article was written by Reid Steadman, managing director, non-equity indices, S&P Dow Jones Indices.
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