EuroTrashed: Key Upcoming Dates in the Eurozone Crisis

by CC September 10, 2011 10:16 am • Commentary

From Tyler Durden at ZeroHedge  This is a good primer of what to expect in the next couple of weeks of the Euromess. Bookmark this page and go back to it on days when you’re wondering why the market just moved 5% in 10 minutes:

For those struggling under the deluge of relentless newsflow out of Europe, here are the key events to look for over the next month, courtesy of CitiFX Wire. Readers can take advantage of the weekend which will be calm until late Sunday morning after which it won’t be calm, to familiarize themselves with the hurricane that is headed straight to global capital markets.

Key Upcoming Events

  • September 9: Deadline for private bondholders to declare participation in Greek Bailout
  • September 9-10: Meeting of the G7 in France, Spain votes on budget amendment
  • September 9-14: Potential resumption of the EU/IMF Review of Greece
  • September 12: Meeting of EU foreign ministers in Brussels, ICB report on UK banks
  • September 13-15: Meeting of EU financial ministers in Poland
  • September 16: Eurogroup meets in Poland
  • September 20: IMF”s Lagarde to meet Greek PM Papandreou (Dow)
  • September 29: German Parliament votes on EFSF Changes, Spanish bank deadline to meet new capitalization requirements

And the complete cheatsheet:

Greek Specifics

  • Greece’s key concerns regard private sector involvement in the second bail-out, release of the next IMF support tranche (EUR8bn), and the ongoing collateral debate with Finland.
  • Private sector investors were due to indicate today (Friday) if they will participate in the July bail-out package. Greece is targeting 90% participation rate, raising EUR135bn in funds. However, media reports suggest the current take up rate is around 70%-75%.
  • IMF members are expected to approve the next tranche of Greek aid this month. But talks were suspended at the end of last week to give Athens more time to demonstrate it is meeting its fiscal targets. Informal talks may resume next week, while Dow Jones reports that IMF chief Lagarde will meet with Greece’s PM Papandreou on September 20.
  • The EU is asking for a further Greek deficit cut of 0.7% by the end of the year to secure further financing, according to Dow. The IMF would be happy if Athens just met existing targets.
  • Citi Economics believes international lenders will push for additional tightening measures, which would likely be announced over the next 10 days.
  • Finland has not withdrawn demands for Greek collateral. We do not expect any decisive progress on the matter before the Eurogroup meets on September 16.
  • The French parliament approved its part in the new Greek bailout deal on Thursday.

The EFSF and Austerity Measures

  • Germany’s constitutional court declared EFSF (the Eurozone Financial Stability Fund) participation constitutional on Wednesday (September 7).
  • The German parliament votes on September 29 on proposed changes to the EFSF; it is expected to pass.
  • Slovakia’s Parliament will delay voting on the EFSF until at least December. Reports suggest that the financial minister is working to speed up the process however, to meet the initial October deadline set by EU officials.
  • The Italian Senate approved the EUR54bn austerity plan late Wednesday (September 7). The plan now faces a vote in the Chamber of Deputies next week.

Bank Recapitalizations and Other Issues

  • Key issues under consideration are European bank recapitalization, a new EU financial transaction tax and Eurobonds.
  • IMF Head Lagarde’s call for an immediate recapitalization of European banks drew a stiff rebuke from European policymakers. But the signs suggest they are drawing up action plans ahead of the Eurogroup meeting on September 16.
  • ECB President Trichet opposes recapitalization efforts. Incoming President Draghi, who takes over in November, seemingly backs Trichet’s stance.
  • According to unconfirmed reports on Wednesday (September 7), the European Commission will delay their bank write-down plan for senior bondholders in order to prevent further market panic. A new plan, perhaps with better terms, is expected as early as October.
  • European Commission President Barroso, will likely push for a new EU financial transactions tax (FTT) at the G20 meeting in November. Both the UK and Trichet have criticized the measure. The UK says it will not implement it.
  • Eurobonds are still said to be off the near-term agenda. Merkel remains steadfastly opposed to such a measure, which would not exactly be a major vote winner for her.
  • The head of ratings agency S&P recently noted that the rating of such issuance would be equal that of the weakest member – Greece at CC.