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FT Article: Implications of a Greek Exit
Market Volatility
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FT Article: Implications of a Greek Exit

The following piece from the Financial Times does a nice job of highlighting the implications of a Greek exit from the Euro.  The current environment in Greece seems to favor politics that promise perhaps a bit more than can be delivered.  However, with very high unemployment, the prospect of well entrenched social programs being cut, and even more calls for austerity, it can be very tempting for a constituency to follow a leader that seems willing to "stand up" to the Troika's demands.

Market Volatility

As noted two weeks ago, the uncertainty caused by the European elections--particularly in Greece--has spilled over across global financial markets, including the US.  Shorting Europe (e.g., EPV) and going long volatility (e.g., TVIX) has allowed investors to exploit the market distress and experience gains.
 
Given the elevated levels of volatility, and the recent FOMC minutes indicating a heightened interest in engaging QE3 should US economic data (particularly jobs) continue to be weak, it may be appropriate to reduce short exposures and begin reversing course on volatility.