The doomsayers who at the start of the year predicted a 'Grexit' – a Greek exit from the euro, perhaps followed by a 'Spaxit' or an 'Ixit' – have been served. Greece is exhausted but not won and is still in the euro. The fears and apprehensions linked to the possible exit of Greece will still remain, but the pessimists will make the same mistake as before: not so much in underestimating the extent of the crisis in the Greek public finances, but in underestimating the political will of European governance, a will that sees the preservation of the euro as an absolute good.
Meanwhile, a brief reflection on the investment hit parade in 2012 may help. What was the most profitable investment? The surprising answer is: Greek bonds. Anyone who had bought them at the beginning of the year, at bargain prices given the then looming pessimism, would now find themselves with an 80% gain. To be compared with 3.7% for German bonds and 6.1% for Spanish Bonos, according to the Bank of America-Merrill Lynch indexes. And the Athens Stock Exchange posted its first gain since 2009, up about 30% in 2012.
