November's Big Three
There are two key events other than US elections that investors need to keep an eye on in November, says MoneyShow's Jim Jubak, and the Eurozone meeting may be the most important.
November really brings us the Big Three. We’ve got a transition in China; we’ve got a presidential election in the United States...but we shouldn’t forget Europe, which has really been the macro scenario driving markets for most of the last two and a half or three years.
We’ve got a big meeting of Eurozone finance ministers that are supposed to maybe approve a Greek deal, which would get Greece the next tranche of its bailout money—about €31 billion or €32 billion, enough to fund Greek banks and keep the Greek banking system operating, pay off some bills that the Greek government has built up over the last year they haven’t been paying, the people have been providing services to them.
All those things are supposed to happen on November 12. If it does, we’re still looking at really no solution to the Greek crisis. All we’ve done is postpone the immediate crisis. The Greek economy is still sinking like a stone, which means that any budget deal that the Grecians just struck with the troika of the European Commission, the European Central Bank, and the International Monetary Fund won’t hold, because tax revenues go down as the economy gets smaller. None of this really solves Greece, and at some point there has to be a solution.
And the bigger thing that’s lurking in the background of the meeting on November 12 is what are we going to do about Greek debt?