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Greece Is The Word

As you likely know, in recent weeks Greece has landed in the headlines due to its debt crisis.

Specifically investor confidence in Greece has fallen dramatically after its deficit ballooned because of its weak economy.

Although it might seem like a rather isolated problem, the potential for it to ripple is significant because “Greece has extraordinary exposure to banks in France and Spain,” says Tim Seymour.

Also what happens in Greece has an impact on EU’s currency – the euro.

If the economy of Greece stays weak, the European Central Bank may find it difficult to tighten monetary policy later this year to head off inflation in richer countries.

That’s a problem for nations such as Germany, which has been experiencing a more vibrant recovery. In a worst case scenario, because of weakness in Greece, Germany could face runaway inflation with no means of controlling it.

"As a result we’ve seen currency traders crushing the euro," explains Dan Cook, a senior market analyst at IG Markets in a Reuters interview. “Until the issue is resolved "we will likely see a lot of selling pressure on the euro," he adds.

What’s the trade?

I’d short the euro, says Tim Seymour.

I’m long the pound via the FXB, says Joe Terranova. I think it rallies.


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Trader disclosure: On January 29th, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders Finerman's Firm Is Short (IJR), (IWM), (MDY), (SPY), (UNG), (USO); Finerman Owns (AAPL); Finerman's Firm Owns (BAC), (BAC) Leaps; Finerman Owns (BAC), (BAC) Preferred; Finerman's Firm And Finerman Own (CVS); Finerman's Firm And Finerman Own (GOOG); Finerman's Firm Owns (IBM), (KFT), (MSFT), (WMT); Finerman's Firm And Finerman Own (RIG); Finerman's Firm Owns (PLCE); Seymour Owns (AAPL), (BA), (F), (INTC), (PBR); Terranova Owns (BAC), (JPM), (XOM), (HAL), (OIH), (FCX), (GOOG), (FMC), (AAPL), (DELL), (MSFT), (QCOM); Terranova Is Long March British Pound Futures; Terranova Owns (XLF) Feb. Calls; Terranova Is Short (AAPL) Feb. Calls

For Tim Seymour
Seygem Asset Management Is Short (VALE)
Seygem Asset Management Owns (POT)
Seygem Asset Management Owns (FCX) Calls
Seygem Asset Management Owns (PBR)

For Joe-Terranova
Terranova Works For (VRTS)
Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.
Virtus Investment Partners Owns More Than 1% Of (CLB)
Virtus Investment Partners Owns More Than 1% Of (DLR)
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (UA)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (SKT)

For Brian Stutland
Stutland Owns (XOM)
Stutland Is Short (SPY) Directional Position, Long Volatility
Stutland Is Long VXX
Stutland's Firm Is A Market Maker In VIX And SPX
Stutland's Firm Is Short VIX Directional Position, Short Volatility
Stutland's Firm Is Short S&P 500 Directional Position, Short Time Spreads

Other Relevant Disclosures:
Seymour Owned (GOOG) On 1/21/10
Terranova Was Short Feb. Crude Oil Futures On 1/11/10
Finerman's Firm Owned (AXL), (AXL) Calls On 1/8/10
Kaminsky Was Short (QQQ) On 1/7/10
Terranova Was Short Feb. Crude Oil Futures On 1/11/10
Finerman's Firm Owned (TGT), (TJX) On 1/12/10



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