D Day For Greece?

Today, according to the media, is "D Day" (Decision Day) on the second Greek bailout.

Most in the mainstream media, egged on by spin and hype from the usual suspects in the Eurozone, are predicting that the bailout will be agreed and that the Euro130BN will be handed over to Greece without further ado.

However, scratch beneath the surface and the picture isn't quite so rosy.

In the event that the deal is agreed today, acceptance by Greece of the terms of the deal will in effect mean that it has defaulted.

For why?

The ECB has done a better deal for itself than other bondholders, and those that hold out against this subordination will be forced to take a 70% haircut (the is a default event, by any definition of the word).

Additionally, to add to Greece's woes, the Eurozone finance ministers (ever reluctant to trust Greece) are looking into setting up an escrow account which will be used to pay the bailout in tranches (if and when Greece honours its side of the deal).

Finally, in a comment not yet picked up by some in the media, Finland has said the deal will not be approved until 12 March.

Deal done?

No!