Euro Zone Bailout Package Consequences By Now that all parties are on board for Greek
debt relief we need to ask just what the Euro Zone bailout package consequences will be. The immediate result will be that Greece will
not default on its national debt in March of this year. But what else is going to happen
as a result? Will trading Euro Zone stocks be profitable? Will the rise of the Euro that
occurred immediately after the debt bailout deal was announced continue? Will the fiscal
austerity measures being put in place across the continent be enough to forestall other
debt defaults? And will the fiscal austerity measures so
badly needed for fiscal discipline end up causing a recession? Trading the Euro One of the immediate Euro Zone bailout package
consequences of trading the Euro was that the Euro went up against virtually all currencies.
We can safely assume that this “sigh of relief” was due to the assurance that Greece will
not immediately default on its debts and cause a domino effect of defaults in Italy, Spain,
and Portugal. However, we can also assume that the economic
growth of Greece will be a flat line for years to come. This will likely be the case despite
pressure from other EU members to make the Greek economy more competitive by privatizing
many government held industries. The likelihood of dismal economic growth is not limited to
Greece in the years to come. The Euro may have popped up nicely on news of the bailout
being finalized but may languish for some time to come as Europe deals with debt issues.
The necessary austerity measures will likely lead to a recession in the next year or so
and consequent downward pressure on the Euro. Trading Euro Zone Stocks Euro Zone bailout package consequences may
be a bit better for some Euro Zone stocks. Although the EU economy may go into recession
due to necessary austerity measures, there are strong European companies that sell their
products across the globe. A cheaper Euro will benefit companies like
Siemens who may produce products in a now more cost effective Euro Zone and sell internationally
at lower prices. One of the Euro Zone bailout package consequences will be welcomed by long
term investors. Volatility in trading the Euro and trading
Euro Zone stocks may well fall now that the current bail out is a done deal.
As always, traders are reminded that not all stocks will move in lockstep with the economy.
In trading growth stocks it is often more important to have a clear view of a company’s
products, their market, sales, and production efficiency that just how well the Euro or
a given European economy is doing. Trading Profits Going Forward Smart traders will use technical analysis
to keep in touch with day to day market sentiment. The negotiations for a debt deal for Greece
are over. However, Greece needs to implement its austerity measures. Euro Zone bailout package consequences include
the fact that private investors, including many European banks, will be licking their
wounds after taking substantial write-offs. Many may be hesitant to invest in Euro Zone
bonds going forward. If Greece of other European nations fail to follow through with the necessary
austerity measures we could be seeing the same debt dilemma in a couple of years,
but with no bailout and a shakeup if not collapse of the broader European Union. To the extent
that Europe has solved its debt problems economies throughout the world will probably do better. As such a next step going forward could just
as well be to buy Chinese stocks or buy US stocks in light of the slow but sure United
States economic expansion. For more insights and useful information about
trading stocks, options, futures or Forex, visit