Asset markets and currencies essentially are in stasis ahead of Sunday’s critical election in Greece. In recent days, the odds of a victory for the pro-bailout New Democracy Party (NDP) have shortened considerably. That said it is also apparent from recent polls that there remains a strong groundswell of support for Syriza, and that it will push the NDP all the way. Even if Syriza did top the poll, the party will find it difficult to fashion together a majority government. As such, the claim by Syriza’s leader that the legitimacy of the EU-IMF bailout will be hugely compromised should his party win is partly bluff. Although an understandable sentiment, Tsipras has a problem if he attempts to rip up the agreement too quickly – for instance, the only way to pay Greece’s immense public services bill is through the good grace and favour of international creditors. Should Tsipras send Greece’s creditors packing then he will rapidly incur the wrath of government workers and his support will drain away almost overnight. Unfortunately, there is every prospect that this weekend’s Greek election will again be a ‘no result’.
Greece is almost ungovernable these days, a function of its bankruptcy, the collapse of proper institutional structures and arrangements, chronic tax avoidance, a spectacularly rapid decline in living standards and a subjugation of hope. Ultimately, Greece will certainly leave the euro and hopefully it will be sooner rather than later. The outcome of this weekend’s election is very unlikely to temper this inevitability.