Sunday, June 05, 2011

More details on Greek Debt Restructuring

by Bill McBride on 6/05/2011 05:51:00 PM

We could call it a "soft" restructuring. Or just call it a "default" ...

From the WSJ: Greek Debt Plan Gains Support

Support among European governments is building for ... probably ... what would be the first default of a euro-zone nation in the common currency's history.
...
Under the proposed plan, the 17 euro-zone governments would ask Greece's creditors to exchange their soon-to-mature debt for debt with a longer maturity, a process that could begin as early as July after finance ministers approve the new Greek aid package at their meeting June 20 ... A German finance ministry paper ... proposes a seven-year extension on maturing debt.
We will see tomorrow if this plan is seen as a positive for short term debt - the Greek 2 year bond yields fell sharply on Friday to 22.8%. Here are the links for bond yields for several countries (source: Bloomberg):
Greece2 Year5 Year10 Year
Portugal2 Year5 Year10 Year
Ireland2 Year5 Year10 Year
Spain2 Year5 Year10 Year
Italy2 Year5 Year10 Year
Belgium2 Year5 Year10 Year
France2 Year5 Year10 Year
Germany2 Year5 Year10 Year


Earlier ...
Summary for Week Ending June 3rd
Schedule for Week of June 5th