Europe saved by SPIV


Fills you with confidence, doesn’t it?

A GLOBAL credit crisis was averted yesterday when leaders agreed on a rescue package for Greece and the euro common currency that is likely to involve China and other developing countries helping to prop up the European economy.

Equity and currency markets reacted positively to the long-delayed rescue plan, which came after ominous warnings from German Chancellor Angela Merkel that continued “peace and affluence” in Europe could not be taken for granted without a euro solution.

French President Nicolas Sarkozy said he would call his Chinese counterpart, Hu Jintao, to plead for cash-rich China’s involvement in a new support mechanism called a “special-purpose investment vehicle”, with the unfortunate acronym SPIV.

Catchy.

“I think the whole world is going to be relieved by this,” Mr Sarkozy said.

Er… kinda.

And gee, wouldn’t it be nice if we could all get deals like the following?

The most eye-catching aspect of the rescue plan was an agreement that banks and other private lenders would accept a 50 per cent loss on Greek government bonds to give the teetering Greek economy some hope of fighting its way back to viability.

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  1. November 3rd, 2011

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