Turk: ‘silver price at $68-70 in two-to-three months’

At long last: the ratings agency Standard & Poor’s has deemed Greece to be in “selective default”. The European Central Bank has temporarily suspended the use of Greek bonds as collateral. However, stocks have been moving higher in trading this morning following the vote in the German Bundestag yesterday to authorise the new 130 billion-euro Greek bailout deal agreed by finance ministers last week. The markets have after all had months to come to terms with the idea of Greek bankruptcy.

Moreover, as Jim Sinclair points out at JSMineSet.com: “Only the International Swaps and Derivative Association opines on what is a default as it applies to credit default swaps. S&P carries no power over the performance (or lack thereof) of CDSs.” It is this uncertainty about whether CDS written on Greek debt can be honoured that still has the serious potential to spook investors.

Many of you are by now likely sick to the back teeth with the Greek debt crisis, and the reams of ink that has been spilt by journalists and market analysts on this issue (not least at this website). But this column urges you all to read Detlev Schlichter’s cogent analysis of Greece’s problems, and the bigger picture surrounding the debates about austerity, debt, monetary union and the eurozone. Commenting on the now conventional wisdom that returning to the drachma would help Greece, Detlev notes:

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via Turk: ‘silver price at $68-70 in two-to-three months’.