Note from dshort : As I type this note, the Greek election is just a few hours away. The general perception is that none of the political parties will win a parliamentary majority. At the request of a reader, here is an updated snapshot of the Greek stock market, one month after my initial post on the topic.
Last month I read a couple of interesting commentaries by familiar pundits at Project Syndicate on the ongoing disaster in Greece. PIMCO's PMohamed El-Erian asks the rhetorical question Who is Responsible for the Greek Tragedy? Nouriel Roubini states unequivocally that Greece Must Exit the Eurozone.
The latest Greek unemployment rate, data through March, is at a record 21.9% and 52.8% in the 15-24 age group, up from 42% a year ago. The country, having failed to elect a government, has sworn in a caretaker technocratic cabinet to govern until new elections on June 17.
Of the many grim facts about the situation in Greece, here is a snapshot of one of the ugliest. The Athens Stock Exchange General Index is a capitalization-weighted index of Greek stocks listed on the Athens Stock Exchange. As of Friday's close, the index had risen 13.71% for the week but is nevertheless down 89.5% from its all-time high at the end of October in 2007.
To put this stock market catastrophe into a larger historical context, here is an overlay of the Dow Crash of 1929 and the Crash of the Athens Index.
The crash of the Dow was a bit faster, but on June 5th, the Athens Index hit its trough to date, down 91.07% from its 2007 all-time high. We'll soon discover the outcome of the next round of elections for the birthplace of democracy.