First thing this morning, when summarizing the flurry of overnight events, we focused on today's final gambit by Greece:
"... moments ago Varoufakis was quoted as saying he would ask the Eurogroup for a bailout extension of a few weeks to accommodate the referendum.And the punchline: if the Eurogroup says "Oxi", then the entire Greek gambit, which has been a bet that to Europe the opportunity cost of a Grexit is higher than folding to Greek demands, collapses.If the Eurogroup declines Varoufakis' request, there simply can not be a referendum, as the "institutions proposal" will no longer be on the table. As such, the only question is whether the ECB will also end the ELA at midnight on June 30, adding insult to injury, and causing the collapse of the Greek banking system days ahead of a referendum whose purpose would now be moot."
And, as expected, with the Eurozone meeting on Greece having just ended after a brief hour of deliberations, AFP reports that the answer, was indeed, no.
And then this:
- EUROGROUP PRESS CONFERENCE CALLED OFF IN BRUSSELS
- EURO-AREA FIN. MINISTERS TO CONTINUE TALKS WITHOUT GREECE: ANP
- EUROGROUP TO RECONVENE AFTER BRIEFING W/O GREECE: EU OFFICIAL
In effect, and very symbolically, Greece is already out of the Eurogroup.
What happens next: Eurogroup makes it official that the Greek proposal ends on June 30 making the referendum moot as the institutions proposal will no longer be on the table, the ECB pulls a "Cyprus" on Greek ELA, and a Greek bank system which is put on indefinite hiatus, leading to a "soft" Greek default if not outright Grexit, paving the way for even more ECB QE.
In the meantime, here is the live feed from the Euro-ex-Greece-Group where now only 18 countries are allowed to opine on the future of the costliest, and most artificial monetary experiment in history.
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