Yes and no.
Via the Montreal Gazette:
FRANKFURT – A deal has been reached among Greek political leaders on additional austerity measures demanded by EU-IMF creditors in return for a loan bailout, European Central Bank chief Mario Draghi said Thursday. Draghi told a news conference that he had received a phone call from Greek Prime Minister Lucas Papademos just minutes earlier and “he told me that agreement has been reached and has been endorsed by major parties.”
But:
Quizzed about the possibility that the ECB could take losses on its holdings of Greek government bonds, which it has amassed under its controversial bond-buying program, Draghi refused to be drawn on the issue.
But he pointed out that the ECB is “not a negotiating party” in the talks between Greece and its creditors over a write-down of its private held debt.
We’ll see, but, if in the meantime you want to see what a collapse in confidence can look like, this story (via Ekathimerini) is a classic:
Vodafone Group Plc (VOD) is moving cash from Greece into the UK “every evening,” mirroring efforts by others companies such as GlaxoSmithKline Plc (SAN) and WPP Plc (WPP) to hedge against the European debt crisis.
Vodafone, the world’s biggest mobile-phone company, is also looking at billing in a different currency “if the situation arises,” Chief Financial Officer Andy Halford said on a conference call on Thursday. Asked about the possibility of a Greek default, he said “it’s obviously something we’ve been having a close look at.”
The cash sweep by Newbury, England-based Vodafone shows how UK companies are trying to protect themselves against potential writedowns and losses in countries using the euro. Drugmaker GlaxoSmithKline started repatriating cash held in most euro-area banks early last year. WPP Finance Director Paul Richardson said yesterday that the biggest advertising company rounds up excess euros from its banks in Europe and moves them to the US where they are exchanged for dollars every day.
“What would happen if the guillotine were to come down?” Richardson said in an interview. “Everyone has had a very close look at in-country arrangements and people have taken legal advice,” he said, adding that WPP “feels reassured that we’re in as good a position as we could be if one of the countries had a massive writedown.”
…GlaxoSmithKline, the UK’s largest drugmaker, moves “tens of millions of pounds” in cash every day out of banks in Europe into accounts in the UK, Chief Executive Officer Andrew Witty said on February 7.
“We don’t leave any cash in most European countries,” excluding Germany, Witty said. “Any cash that we bring in during the day gets swept out of the local banks into banks that we think are robust and secure.” [Bloomberg]
