Regarding Greek Default

June 30th, 2015 5:43 am | by John Jansen |

A fully paid up subscriber forwarded this to me at about 406AM (about 90 minutes ago). I do not know the source as he did not identify from whom he received it:

BONDS: German government bonds are trading higher early Tuesday, again boosted by safe-haven buying as markets weigh up the implications of Greece failing to make its E1.55bln bundled debt repayment to the International Monetary Fund by the 2200GMT deadline. Whilst the major credit rating agencies have already stated a non-payment to the IMF does not classify as a default – note the Washington based lender doesn’t use the term default, but instead says Greece will be in arrears – it appears the real issues for Greece begin when the IMF managing director notifies the executive board of a missed payment within 30 days, but in this case will notify immediately, given the size and the potential risk to the fund. Failure to make the repayment today will cut Greece off from further IMF funding. Moreover, it is likely to trigger default clauses in other debt contracts. Indeed, the EFSF may also cancel, as it deems appropriate, “the whole or any part of the undisbursed amount,” according to the Master Financial Assistance Facility Agreement between the EFSF and the Hellenic Republic. Greece will officially exit the 2nd bailout programme at the close of business today and the ECB will decide tomorrow whether it intends to keep ELA funding going.

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