Watching and Waiting

I've been watching and waiting to see some sign of the Greek finance minister meeting outcome. Early today, everything was peaches and cream, every article was a cut and paste of essentially what the media saw as a done deal. The announcement scheduled for 5 p.m. EDT has come and gone with no word.

This is the first article that I have seen that suggests there's real trouble and that Greece may in fact need a third bailout as things are even worse then the extra $15 bn euros needed since the $130 bn rescue was agreed on last October. So far the Euro isn't tipping their hand.

From the FT:

A “strictly confidential” report on Greece’s debt projections prepared for eurozone finance ministers reveals that Athens’ rescue programme has veered off track and suggests the Greek government may need another bail-out once the second rescue agreed this week runs out.

The 10-page debt sustainability analysis, distributed to senior eurozone officials last week but obtained by the Financial Times on Monday night, finds that even under the most optimistic scenario, the austerity measures being imposed on Athens risk a recession so deep that Greece will not be able to climb out of the debt hole over the course of the new €170bn bail-out.

The report makes clear why the fight over the new Greek bail-out has been so intense in recent days. A German-led group of creditor countries – including the Netherlands and Finland – has expressed extreme reluctance since they received the report about the advisability of allowing the second rescue to go through.

Perhaps this is why the German FM said Greece was a bottomless pit last week.