Lioness Associates, Inc.

Economic & Corporate Risk/Yield Reports

May 29, 2012  -- Greece Risk/Yield for 2012

Greece has been in the news since late 2009 ... yes, that long, and there are no signs that it's problems are over.  At the beginning in 2009 there were just hints of issues but, it was not until the "funny" bookkeeping came to light at the start of 2010 that the seriousness of the situation was brought into the open (see article). Years later, the problems cannot be considered solved (see article).  New elections will be held in June of 2012 and none of the possible outcomes are likely to promise quick stabilization of this country to allow it to start making some headway towards addressing it's problems.  Rather, it may be that this country enters still another chapter.

The Greece Delta Core/Transient 2012 graph shows a light uptrend into Yield in June which could be as a result of the "hope" of better results in the June 2012 elections.  There is a bit of stabilization during the end of June, but July starts to shift the momentum towards Risk.  This continues through the October period with core (black line) predominantly in Risk. 

The Greece Risk/Yield 2012 graph shows a heavier concentration of the data points in "risk" rather than in Yield in the October 2012 period.

It's possible that the June 2012 elections end up like the last elections with no clear government and in that case, the next financial aid package from the Euro countries which is due at the end of June 2012 could hold the key to indicate which way "the wind is blowing in Europe".  We'll check back and update after the elections. 

      Greece Delta Core/Transient  2012 graph


        Greece Risk/Yield  2012 graph

Disclosure as of 5/29/2012 - CurrencyShares Euro Trust (FXE) and Global X FTSE Greece 20 ETF (GREK) are not part of our portfolio at this time.