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[dharma]

I'm not sure I can add anything new as I truly don't know how this plays out in the short term. What I do know is that all sides of the negotiations remain delusional. The Tsipras government is delusional if they think the Europeans are going to keep shoveling them money without any tough reforms (I don't believe higher taxes is the answer, but right-sizing their public sector certainly is). Tsipras himself is delusional if he thinks that the economic policies of North Korea are the best path to follow. The Greek people are delusional if they think they can have a better life as long as the private sector is being milked to fund an overly generous public sector (in other words, the welfare state is officially out of other people's money). And, the Europeans are delusional if they think they don't have to write off any portion of the 300b+ Euro debt that is owed to them. From a broad market perspective, we know Greece is a tiny country and thus its troubles won't matter for the global economy, but if investors don't take this as a wakeup call that they should start paying attention to valuations in year seven of a global bull market in many asset classes, I believe that is a huge mistake. My biggest worry is not Greece, it is a global rise in interest rates which we've already started to see as investors have finally said 'no mas' to what was just two months ago an insane level of interest rates around the world, mostly in Europe. Whether 'no mas' was triggered by the realization that debt levels around the world have reached epic proportions and/or inflation expectations have begun to rise and/or there is a belief that economic growth is somehow going to start accelerating (which I doubt for now), the direction of interest rates should be the main focus. For U.S. equities, expensive can stay expensive, but valuations do start to matter when interest rates rise and earnings growth slows, and that is the period we are entering. "As for China, and in honor of the last Grateful Dead concerts, Chinese authorities have made a 'friend of the devil.' That devil is the belief that one can successfully bully and manipulate markets higher for any prolonged period of time. They've fallen victim to the central bank belief (no thanks to the Fed) that higher stock prices should lead to economic growth rather than prices reflecting the state of the economic growth. If there is any economic theory that should be thrown to the wolves, it is the stock market wealth effect, as not only is there none, but it always reverses itself eventually if stock prices don't truly reflect the underlying asset they are valuing. When the chapter is finished on this time of economic history, hopefully the current orthodoxy of central bank free money being the answer to economic ills rather than the cau