Photo: Bruce Krasting
I spoke with my Greek shipper friend from Athens about the upcoming May 6 election. This is an event that should be feared by the markets according to this person.
There are two large political groups that have been the basis of coalition governments in Greece. On the right is the New Democracy party; on the left is the Pan Hellenic Socialist Movement. Both of these parties are out of favour today. The most recent polls show that the two parties together would get less than 40% of the popular vote. If this is the result, it will be very difficult to put a new governing coalition together.
There are many other smaller political parties that will get the dissenting votes. At this point it is unclear who will end up with the bargaining chips post-election. The fear is that some of the smaller parties will have a big say in the outcome. My friend had this to say:
“The other parties are communists, radicals and crazies. If they have a hand in the new government, then on May 7 Greece will be forced to take dramatic steps. The whole idea that the country should suffer, so the bankers can get paid would have to change.”
“Remember the history. After WWII there were years of fighting in the streets of Athens with the Communists. British troops were forced to come in to end the fighting.” If the Communists make a comeback in this election, then instability will follow.
“Also on May 7, the attitude in Brussels and Bonn towards Athens will change as well!”