With d(default)-day right around the corner, Prime Minister Alex Tsipris believes he hasn’t lost the battle just yet. In a television interview several hours ago, Tsipris suggested that European leaders would not have the nerve to kick his country out of the eurozone membership and that the cost of their doing so would be “enormous.”
Tsipras has forced Greece into economic chaos and political insecurity by implementing emergency measures that have not succeeded in preventing Greece’s financial system from stumbling to a bitter end.
Yet, despite these efforts, the majority of the Greek populace seem to be standing behind him and are rallying to support his July 5 referendum and vote ‘no’ to accepting the European Union’s aid proposal.
“The referendum will give us a stronger negotiating position when the talks resume,” he said on Twitter. “The higher the participation and numbers of people voting ‘‘NO’’ the stronger our position will be.”
Some are Optimistic
According to David Rosenberg, the chief economist and strategist at Gluskin Sheff, a deal between Athens and its creditors will happen and a Greek exit from the euro is not a certainty. The crisis will subside sooner rather than later and investors should be regarding the situation as an excellent buying opportunity.
"I'm looking at this as something temporary," Rosenberg said. "This too shall pass.”
Not everyone agrees with Rosenberg’s complacent attitude. Economists view the euro’s 3% rally Tuesday which reversed Monday’s losses as a knee-jerk reaction to the Greek situation, and believe that a "Grexit" could imperil the former-Communist countries bordering Greece, countries that are too small economically to be part of the emerging markets mainstream.
There remains a strong possibility that the ECB will step in and rescue the situation.
