Double Secret Selective Default

 | Feb 28, 2012 | 8:05 AM EST
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After more than a year of daily handwringing in the markets about the snails-pace exposition of the Greek debt crisis, suddenly things are zooming by in fifth gear. They may be moving faster than investors can actually digest them.

After the bell Monday, S&P put the Greeks on double-secret probation (the bonds, not the Deltas) or "selective default" in the parlance of the ratings agencies. And everyone took it in stride as a necessary move given the collective action clauses now attached to the debt. In fact, Greece "shrugged it off," according to the FT, which must be the first time in recent memory anything in that country was summarily dismissed without at least some outrage.

Days before the latest deal the prospect of something triggering credit defaults swaps (such as the latest S&P move) was considered a major danger to the European economy. Looks like a committee from the International Swaps and Derivatives Association, asked by an appropriately clandestine "unidentified entity," will decide by Wednesday, reports the Journal.

But instead of people shouting on TV about another Lehman event and the horror of a faceless requestor, things have already moved on to the ECB. The central bank is no longer accepting Greek bonds as collateral. That's pretty big too, but only if you don't have faith in the private sector agreement working out.

How did people become so blasé about what happens to Greek debt now. Probably with German Chancellor Angela Merkel convincingly pushing through the latest bailout approval vote. She came through in the clutch for the single-currency crowd after some big questions about the troika's commitment were raised.

Now the ball is back in Greece's court to push through its austerity measures. To figure out just how worried you have to be about that, check out this handy Greek strike calendar.


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