Austin-Powers-For-PM: If some of you remember, I said back in early June that the only way the RV would not happen before June 30th is if the Greek pro-bailout party won the election AND the tariffs in Iraq were postponed and Maliki was still around.
Well lo and behold both things happen and guess what, NO RV. So where are we now? Let's fly up to 30,000 feet to get a birds eye view. The fact is that the Greek election bought the EU some extra time to figure out what they want to do to save the Euro, but not much.
Also, with Maliki being able to get Talabani to hold off a No Confidence vote, and thus no resolution to the GOI, the tariffs had to be put off as it would have exponentially increased inflation. So where are we? Well the fact is that the EU is running out of cash and fast.
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The higher the rates creep on Spanish and Italian bonds, the louder the cries for the Germans to secure Eurozone bailout bonds, which I seriously don't think they will do unless they basically get take ownership of of Southern Europe lock, stock and barrel. Needless to say, that won't happen so the money will have to come from somewhere else.
Austin-Powers-For-PM: In the meantime the whole No Confidence movement against Maliki has fizzled out. Why? Probably because they have a deal behind the scenes, and they're waiting and hoping that Maliki pulls the trigger and finally seat the GOI.
That and the torrent of CBI articles saying that the new currency is coming heck or high water means that some sort of resolution in Iraq has to be coming soon.
Why is this so important? Because the IMF knows that if the Eurozone goes down the tubes, they'll take the global economy with them into another deep and dark recession. However, the IMF can't and won't pull the trigger on a global currency revaluation until their linchpin, Iraq, is set and ready to go.
You can't dramatically change the value of a nations currency whose political system has all the stability of a bowl full of jello. it also doesn't help that the neighborhood (Iran and Syria) is burning down around them. So what does this mean?
IMO, Europe can probably make it to September before the financial wheels come off and the Euro falls apart like a cheap watch, so keep an eye on that, and watch as the CBI imposes it's will on the GOI to finally get their house in order so this RV can get done.
In essence we are playing a giant game of chicken on multiple levels, so hang on everybody it's going to get interesting over the next few weeks, but once that is over it will bring us to our destination.