Tags: short | bets | greece

Experts: Bets Against Greece May Soon Turn Sour

Wednesday, 10 Mar 2010 08:51 AM

By Dan Weil

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink
Seemingly every investor and his mother have been selling Greek government bonds lately amid worries the government may default on its debt.

That may soon change thanks to the growing likelihood that the European Union (EU) will bail the country out.

"You've already had a scramble to close out the short positions," Gary Jenkins, head of fixed-income research at Evolution Securities, told The Wall Street Journal.

The credit default swaps used by traders to bet against a default have begun to slide, and Greek government bond prices are starting to rise. A vicious short squeeze could ensue.

European officials have called for more stringent regulation of the sovereign credit-default-swap market, which also could make those who have shorted Greece suffer.

BaFin, which regulates German markets, is investigating whether speculators are piling on against Greece.

"It is important to know if speculators are betting against Greek national debt," BaFin spokesman Ben Fischer told The Journal.

But increased regulation would probably have to be global to have any chance for success.

And not everyone thinks a bailout will make much difference. "I don't think it's going to be the catalyst people are hoping for," George Papamarkakis of North Asset Management, told The Journal.

The Greek crisis has led the EU to consider a clampdown on its members. "The European Union appears ready for stronger economic coordination and stronger economic governance," EU Commission President Jose Manuel Barroso told reporters.

© 2014 Moneynews. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

Report: White House Expects 'Surge' of Immigrants

Sunday, 19 Oct 2014 23:36 PM

The U.S. Citizenship and Immigration Services has published a draft solicitation for immigrant identification cards that . . .

Obama: Republicans 'Just Have Bad Ideas'

Sunday, 19 Oct 2014 22:59 PM

Marching onto the campaign trail for the first time this year, President Barack Obama cast Democrats' success in this ye . . .

Sources: 'Trench Warfare' Ahead for Church Over Marriage, Family

Sunday, 19 Oct 2014 22:32 PM

Pressure from Catholic Church leaders closely allied to Pope Francis on changing the church's approach to marriage and t . . .

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved