Weekly Game Plan - 12.7.2015

As you well know, there are ongoing meetings in place between Greece and creditors. What can happen? There are two views of the weekend events. The most probable is business as usual in the euro zone.

The Eurogroup likely will end up sending Greece a list of proposals that they will have to legislate immediately. The big question here is whether Tsipras can get any proposals through the Greek Parliament, after a useless "NO" referendum, and an evident (and logical) loss of consensus amongst the Greek population. Most likely that the Greek Parliament will end up passing legislation that never really gets implemented.

The second view, less probable but still possible, is that Greece is out of the EU. The northern EU countries do not trust the Greeks  and feel that they can handle the contagion to other peripherals in the event of a  Grexit. However, I would like to highlight the emerging sentiment that was also spoken about in the skype trading room: the divergence between countries & politicians is demonstrating how the EU is effectively useless. Members are fighting amongst themselves once again, just that instead of pointing guns at each other, they are pointing fingers and enforcing austerity. The fact remains that there are no "europeans" in the room. There are Germans, Greeks, Italians, French, etc. and each party thinks only for themselves it appears. These ongoing negotiations are the demonstration that the EU project is an utter failure.

The more divergence is shown between north & south, the more "extremist" parties will form, and the closer we will get to seeing the likes of another dictatorship in a G10 country.

Why is it that politicians never learn from the past?

1. Themes for the Week

- Decision on Greek bailout to be made over the weekend
- Fed Chair Yellen delivers semi- ellen delivers semi-annual testimony to Congress
- Headline UK inflation to mask underlying upside price pressures

2. Calendar

Times are GMT, source: FXStreet.com

3. Look around the markets

Chop chop continues in equities..expect some risk off 

if no deal is reached overnight.

Energy sector not liking this uncertainty.

In FX, Cad & Nzd still seem like the easiest currencies to short

vs. USD.

Good Luck this week!