|This picture in no way looks to me as if the Greeks will shortly be accessing Russian funds|
It was all looking so optimistic last week, Greece's new unsuited finance minister came to London and the European Capitals with a plan to reduce Greece's payments and also to get back some money from the ECB which it had made buying Greek bonds.
All sounded so good until he went to Germany. The German Minister, Wolfgang Schauble, was not happy at the idea of further Greek reduction and an end to the Troika policy. He was open to relaxing some of the terms and coming to a deal, but only with the ECB/IMF remaining in charge or Greek finance.
However, it has all deteriorated quite rapidly in the past few days. The ECB has restricted funding to Greek Banks and the Prime Minister in Greece, Alex Tsipras has gone on record to end austerity and co-operation with the Troika agreement.
This, in the colloquial, is squeaky bum time.
It is going to be interesting to see what happens from here. My hunch has been that the QE from the ECB was a quid pro quo deal to allow Germany to force Greece out of the Eurozone. This is a big deal for the EU though as it make the Euro an exclusive rather than inclusive club- completely against the political grain of the EU.
The markets won't like it either and it will do nothing for the Eurozone's weak growth but in the long-term it is the right way forward for all parties.