Sovereign Credit Risks: Greek Insolvency and United States Debt Limit
Greece took legislative action and got an apparent short-term bailout relief from default risk last week. Stocks rose, oil and copper rose, while gold and U.S. Treasuries fell as European debt problems seemed to pose less risk to world economic growth.
Market reactions were strong and contra to recent weeks, with strong positive technical aspects. Consensus forecasts of the S&P 500 are above current levels. However, not all immediate Greek issues are resolved, and long-term issues are wide open.