This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
$1 buys you full access to ALL of TheStreet's Subscription Services! Learn More

Greek Election: The Worst Happened

Stocks in this article: GLDUSOUUPSPYFXETLT

NEW YORK ( TheStreet) -- Of all the realistically possible outcomes of the Greek election, the worst is more uncertainty, yet not enough risk to provide central banks of the world sufficient cover for coordinated action. This is exactly what just happened.

The pro-euro New Democrat came up on top, with a slight lead over the anti-euro (not really their principle, but this is what matters to the world) Syriza. The moderately pro-euro Pasok came in as a distant third. In theory, the New Democrat and Pasok could form a coalition government. But they just re-affirmed that they won't participate in the coalition unless the Syriza is included. The risk for the no-government scenario, therefore yet another election, has risen.

Whether this is enough to prompt the central banks of the world into coordinated action, as threatened before the weekend, is not certain. My bet is on "no"; even if you don't agree, at least the risk of inaction is much higher than if the Syriza had won.

This leaves us at a worse situation than last Friday, when the worldwide markets were buoyed by the hope for coordinated action of central banks: More uncertainty in Greece, but no central bank action (or at least more uncertainty).

Furthermore, whatever government the Greeks may form, they would feel entitled to ask for renegotiation of the bailout deal due to the Spanish deal. While some eurozone leaders have entertained the possibility, Merkel flatly rejected the idea. With apologies to French pride, the reality is Germans call the shots in the eurozone. How this can be construed as a positive for the market is beyond me.

As of early morning Monday, all equities futures are up in Europe, along with oil (USO), gold (GLD) and the euro (FXE), while the USD (UUP) is down. In other words, this is considered a risk-on except for gold.

Well, I don't buy it, very much like I didn't buy the Asian/Europe rally last Sunday, June 10, that faded half an hour into U.S. open the next morning. I was very impressed by how quickly the U.S. market faded the false rally. If that insight continues, the U.S. market will prove once again its maturity and dominance Monday.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,828.24 +0.49 0.00%
S&P 500 2,067.56 -5.27 -0.25%
NASDAQ 4,791.63 +4.3130 0.09%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs