Galery

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The consequences of a possible/pending/imminent haircut for Greece will be not only economic but also social and political. For a long time, the slogan of Greek economic diplomacy was, "Greece is not Argentina." The new finance minister Evangelos Venizelos added his implication and the slogan became "Greece should not become Argentina." The Athens Stock Exchange, however, is of another opinion as it is dancing to Argentine rhythms. The stock market of Buenos Aires lost 75 per cent of its capitalization between the beginning of the crisis in 1998 and 2001, when elected President Adolfo Rodriguez Saa declared a moratorium on the country’s payments. From January 2008 until the present, the Athens Stock Exchange index has lost 95 per cent of its value and theFTSE20 index – 89.4 per cent of its value.

If we trust Iron Lady Margaret Thatcher’s maxim that markets cannot be deceived, what is happening on the Athens Stock Exchange is a presage of impending severe trials worse than those that rocked Argentina during the Christmas of 2001. Today, the Buenos Aires stock exchange has indeed soared - its capitalization has increased by an impressive 1150 per cent. However, if the stock exchange in Greece is still perceived only as a pastime for speculators the similarity with Argentina will end only with the period before the crisis.