They’re still counting the votes, but so far the “No” vote has the lead. In other words, “No” the Greek people do not want to accept strict fiscal austerity measures in exchange for desperately needed bailout money.
In a post on Facebook, Allianz’s Mohamed El-Erian offered a brief preview of things to come should the “No” vote win.
“IF this historic “no” win is confirmed, look initially for a general selloff in global equities, along with price pressures on the bonds issued by Greece, other peripheral Eurozone economies and emerging markets,” he wrote.
And then what? Here’s El-Erian:
What happens next is a function of three main things:
- whether Greece and its creditors can work together to reconcile what were two very different interpretations in the run-up to today as to what a “no” outcome means, and do so very quickly and effectively;
- whether already horrid conditions on the ground, including the high likelihood of further delays in re-opening the banks and significant difficulties getting fresh money into ATMs, provide enough time for the politicians to get their act together; and
- whether the ECB rolls out new measures to contain contagion.
Full article: EL-ERIAN: If the Greek ‘no’ vote wins, prepare for a global stock market sell-off (Business Insider)