European markets were completely rattled today, as talk of a Greek departure from the eurozone (or “Grexit” as the newspapers are calling it) increased in intensity. The apparent collapse of coalition talks in Greece, the spike in interest rates for Spanish and Italian bonds, and the electoral defeats of the major parties pushing for more austerity all signaled a belief that nothing could save Greece. It appears as if the exit is only a matter of months. Whether it unravels the global markets really depends on whether panic can be avoided, and that depends on the emergence of a clear and solid plan to control the contagion of indebtedness.
The Palestinians on a hunger strike in Israeli prisons have agreed to end their strike in return for a change in the terms of their confinement. Most importantly, the Israelis have agreed to reconsider the policy of indefinite detention. It is troubling that the Israelis did not definitively promise to end the policy, but we will wait for the final terms of the agreement.
The Washington Post ran an interesting article today about the ways the oil embargo against Iran is being enforced. Some of the techniques are extraordinary, and the cat and mouse game between Iran and the West is quite incredible.
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