Saturday 19th April 2014
flextrade
BlackRock has been awarded its first Renminbi Qualified Foreign Institutional Investor (RQFII) licence by the China Securities Regulatory Commission (CSRC) - An index joint venture between FTSE Group and Canada’s TMX Group has acquired the indices business of MTS, a European electronic fixed income trading business owned by the London Stock Exchange - The European leveraged finance market is set to undergo a shift this year, as private equity sponsors veer back towards loans to finance leveraged buyouts, says S&P Capital IQ - Turkish corporates are the most exposed among EMEA emerging markets to a scenario of slowing growth, rising interest rates and a persistently weak local currency, according to Fitch Ratings - London-based Global Markets Exchange Group (GMEX) is in talks to acquire an equity stake in ALTX Africa Group, a new exchange operator focusing on East Africa - Alternative asset managers with expertise in high-yield fixed income and distressed assets are upping their investments in the peer-to-peer loan market, according to a new report from Cerulli Associates.

Blog

Corporate Review

By Partners at BDO

Resolution to Greek issue is becoming critical

Friday, 25 May 2012 Written by 
Resolution to Greek issue is becoming criticalYet again, stock markets around the world are showing extreme volatility because of the crisis in the Eurozone. The latest turmoil was triggered as a result of elections in France and Greece, where both electorates opted for their pro-growth, anti-austerity candidates, thus causing panic and consternation in the markets, which plunged one day, only to recover, partly, the next. http://www.ftseglobalmarkets.com/

Yet again, stock markets around the world are showing extreme volatility because of the crisis in the Eurozone. The latest turmoil was triggered as a result of elections in France and Greece, where both electorates opted for their pro-growth, anti-austerity candidates, thus causing panic and consternation in the markets, which plunged one day, only to recover, partly, the next. 

The election results caused yet more stress for the German Chancellor, Angela Merkel, who is now facing considerable external pressure from key international financial institutions as well as France and Britain to issue ‘Eurobonds’ as a means of resolving the crisis, a move which, should she agree to it, would spell certain electoral suicide at home in Germany, who would interpret the step as giving the rest of the Eurozone a blank cheque, with which to continue their profligate ways.

Either way, to resolve the Greek crisis, what is needed is firm and decisive leadership, and fast. Whilst I have some sympathy with the suffering the Greek people are enduring as a result of the austerity measures required to reduce their country’s debt, this is the only way that they will be able to remain in the Euro – a desire the majority of Greeks want, despite having voted for anti-austerity parties. For Greeks to reject austerity measures, while insisting they remain in the Euro, is the equivalent of demanding to ‘have your cake and eat it’ (or should that be baklava). Either the Greeks accept that they want to stay in the Euro and get on with the austerity measures or they reject austerity imposed by the troika and leave the Euro. 

This latter option is increasingly being seen as the better option for Greece by many external commentators but I can’t help thinking that the law of unforeseen consequences will come in to play if Greece does exit, whether effectively pushed out or by leaving voluntarily.  Until the election on 17 June the markets will no doubt continue to be turbulent so let’s hope that there will be resolution one way or the other after 17 June, and swiftly, for all our sakes.

Chris Searle

Chris Searle is a partner in the Capital Markets team at BDO where he specialises in advising companies seeking to list on the Main Market or AIM and in undertaking pre-acquisition due diligence on M&A transactions. He also leads the firm's corporate finance technical and prospectus committees and is chairman of the technical committee of the ICAEW's Corporate Finance Faculty.

Website: www.bdo.co.uk

Related News

Related Articles

Related Blogs