It makes complete sense for U.S. stocks to love the idea of a Greek bailout by the Eurozone.That’s because, in the end, any such bailout patches over market uncertainty likely using European money (More specifically, Eurozone money).
This is a pretty good deal for any investor or company outside of Europe and not under obligation to ultimately pay down European debts in the long-run. American stock market investors should love any solution which uses other people’s money to reduce global economic uncertainty.
Of course, the same probably applies for foreign equity (not bond) investors around the world in relation to America’s debt-driven efforts to stabilise the U.S. financial system and economy. The global economy has been saved by American attempts to soften its own downturn, but foreign investors aren’t on the hook for higher resultant American debt burdens.
So if you’re outside of Europe, cheer for an overly-generous, France-and-Germany-gouging Greek bailout. It would paper over long-term problems with other people’s cash. Surely it’s not one’s ideal situation, but it’s better than many other possible outcomes. For investors in the Eurozone, the situation obviously isn’t so simple.