Don't Be Fooled by Greece's 'Rebranding' Attempt

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I laughed out loud this morning when I read that Greece is going to market itself as an "emerging market" when it tries to sell a multi-billion dollar bond in the U.S. because Europeans won't buy up any more of their desperation.

The Financial Times reports Greece will try to raise between 5 and 10 billion dollars from U.S. investors to help cover the cost of some 10 billion euros worth of loans in May.

Emerging market? This is an extraordinary rebranding effort doomed to fail.

Never mind the historical irony of an ancient civilization calling itself "emerging." In the financial markets, the phrase "emerging market" has come to mean good thing—a reference to nations like Brazil, India, and China, that have economies which are far more structurally sound: little or at least declining debt, current account surpluses for the most part. Oh, and growth, did I mention growth?

Greece is all about trying to pay for a welfare state, the cost of which is crushing them. There is nothing "emerging" about that. Rather, its the continuation of a long European tradition of over-promising workers a long and luxurious retirement, without acknowledging that younger generations will pay for it down the road.

When hairdressers can retire at 50 because their work is "hazardous," and still get a full pension, you've got a problem.

By the way, according to Miller Tabak, the Greek 10-year yield is up 51 basis points (bps) today at 7.04 percent (just 11 bps from the January high of 7.15 percent) and the 2-year yield is up 115 bps to 6.27 percent.