This might count as a legitimat black swan, or at least constitute some serious “tail risk.”
In his latest blog post up at The Telegraph, Ambrose Evans-Pritchard warns that the German professors seeking to overturn the bailout on legal grounds have not given up their fight:
Should they succeed, of course, the eurozone risks disintegration within days, and perhaps hours. I am not sure that investors in New York, London, Tokyo, Beijing, or indeed Frankfurt quite understand this.
There are now four cases at the court – or Verfassungsgericht – arguing that these disguised bank bail-outs breach multiple clauses of EU treaty law, and therefore breach Germany’s supreme and sovereign Basic Law.
In addition to the bailout lawsuits, the professors are also suing the ECB for its purchases of Greek debt, and he notes that no judge has rejected the claim — it’s just that no judge slapped an immediate injunction against the EU. The lawsuits proceed.