Thursday, November 3, 2011

Greek Finance Minister Says No Referendum So Everything is Honky Dory Again

Carry on rallying....  big turnaround from last night when futures were down about 15 points at 2 AM EST.

  • Greece's prime minister abandoned his explosive plan to put a European rescue deal to popular vote and opened emergency talks Thursday with his opponents, who reversed themselves and agreed to broad austerity measures in exchange for a European bailout.
  • Prime Minister George Papandreou ignored widespread calls for his resignation and instead invited the opposition to join negotiations on the bailout, telling an emergency Cabinet meeting that early elections would force Greece into leaving the 17-nation euro currency, with disastrous effects for both Greece and other European economies.
  • Papandreou sparked a global crisis Monday when he announced he would put the latest European deal to cut Greece's massive debts -- an accord that took months of negotiations -- to a referendum. The idea horrified other EU nations and Greece's creditors, triggering turmoil in financial markets as investors fretted over the prospect of Greece being forced into a disorderly default.
  • Two officials close to Papandreou said Thursday the referendum idea has now been scrapped, after the debt deal won support from the opposition. Papandreou spoke with conservative opposition leader Antonis Samaras in the afternoon, his office said, before a major address to his Socialist party deputies in parliament.
  • Papandreou flew to Cannes on Wednesday, where French President Nicolas Sarkozy and German Chancellor Angela Merkel told him Greece would not get the latest funds from its existing bailout until after any referendum. They also said any referendum should be on whether Greece wants to stay in the eurozone or not.
  • After returning to Greece with Papandreou, his finance minister, Evangelos Venizelos, broke ranks and declared his opposition to a referendum. "Greece's position within the euro area is a historic conquest of the country that cannot be put in doubt," he said.  Venizelos said the country's attention should instead be focused on quickly getting a crucial euro8 billion ($11 billion) installment of international bailout funds, without which it faces bankruptcy with weeks.

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