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Is This the Most Important Juncture in History?


Investors cast their eyes towards Europe.

Will Greece trigger the comeuppance? I'll be the first to admit that it's a tad obvious -- remember, we flagged the sovereign sequel to the first phase of the financial crisis sixteen months ago -- but that doesn't make it inconsequential. In fact, one could argue that a conditioned complacency has evolved, as everyone thinks the guy with the bigger pockets will save the day.

We're now faced with the specter of the biggest guys in Europe keeping their hands stuffed in those very same pockets, with their sweaty palms gripping whatever fiat currency they have left. Every man for himself; a chain is only as strong as its weakest link; when the going gets tough the tough take care of themselves. There are a lot of ways to put lipstick on that pig, none of which are particularly pretty.

Here's the rub, and forgive the imagery of rubbed pork. Fitch Rating Agency is saying that even if the debt rollover is voluntary -- which has been at the heart of the issue -- it would still consider this to be a credit event, which is a pleasant way of saying "default."

And if Greece defaults -- and it owes roughly €26 billion by the end of August -- it will trigger a chain reaction not unlike what we saw with stateside financial institutions a few years ago... except global investors will be much quicker to connect the dots from Greece to Germany to European banks to US banks to BAM! Right here.

So yes, I want to be bullish but with a massively binary event in our immediate midst, I must defer to discipline over conviction, and that means no second-guessing regardless of how the market acts or reacts tomorrow.

And I'll remind myself of a simple fact: the definition of a "crash" is when once-reliable indicators no longer work, and those who are staring at stochastics and put/calls and Misery Indices would be wise to, at the very least, acknowledge that risk before they bank on a reward.

Good luck today.


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No positions in stocks mentioned.

Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at

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