More Can-Kicking?

Briefly yesterday the Dow Jones Industrial average spiked above 13,000 before closing at 12,966. The price of gold also continues in the bullish territory of $1,750.00 per ounce today. What gives? The talking heads of the "financial" media are laying these events off on the "deal" struck between the European bureaucrats and the politicians in Greece over the past weekend which are to produce a second bailout for the socialist Greek government to the tune of 130 billion Euros. What could possibly go wrong?

It is good to have cleared the Greek Damocles sword for a few months,” said Raphael Gallardo, the head of economic research at Axa Investment Managers in Paris, which oversees about 515 billion euros ($680 billion). “The euro area governments and European Central Bank have won some time, two months at least. It is positive for risk assets in the short run.  

In other words: "we have kicked the can down the road yet again". What appears to this observer to have been ignored is the Greek elections due in April. The Greeks, now in the 5th year of a serious economic contraction are unhappy to the extent of manning the barricades. The bond holders are expected to suffer a 53%+ haircut and thus unlikely to favor a rollover of Greek debt.

The main players on the political left hoping to form a government after the April elections are already proposing a distribution of the bailout spoils cash:

Syriza and the DemLeft's proposal is for Greece to declare a selective moratorium on debt repayments and use the euro bailout money for a programme of social reform.

In other words: "we will stiff the bondholders and use the bailout cash to prop up our allies in this failed socialist society". This is the usual leftist theft as utilized by the Obama administration takeover bailout of the US auto industry.

We are in for interesting times.