Risk Off: Greek Court Warns Troika-Demanded Austerity May Be Unconstitutional + More Greek Drama: Coalition Member PASOK "In Turmoil As It Seeks To Quell Rebellion"

Submitted by Tyler Durden: While Europe continues to plan and scheme, content in the knowledge that Greece can do nothing to derail plans of status quo preservation, especially ahead of next week's critical parliamentary vote that will see the country imposing even more austerity on its people (see the great profile in the AP today in "Hit by crisis, Greek society in free-fall"), Greece has just decided to pull a "Karlrushe Kardinals who say Nein" move, and as Reuters reported moments ago, the entire process may be scuttled by none other than yet another court, this time in Greece:

• GREEK COURT SAYS PLANNED PENSION CUTS, RETIREMENT AGE INCREASE  SOUGHT BY EU/IMF LENDERS MAY BE UNCONSTITUTIONAL

What this means is that suddenly Greece once again has all the leverage (recall that last year the mere threat of a Greek moratorium cost G-Pap his job), a development which in June sent Europe plunging on fears that Greece may vote itself out of the Eurozone, leading to a Grexit, the return of the Drachma, redenomination, collapse in risk levels, the apocalypse and other bad things.
Judging by the reaction in the EURUSD, risk is now once again off.



More from ANA via Bloomberg:

• Greece’s Supreme Court of Audit ruled that Greek austerity measures including cuts to pensions and an increase in the retirement age may be unconstitutional, state- run Athens News Agency reports, without citing anyone.
• Court of Audit almost unanimous in ruling the measures are unconstitutional, ANA says
• Court ruled on pension cuts, retirement age and cuts to pensioners’ holiday bonuses, ANA says
• Court says 5th cut to pensions in short period of time contravenes number of constitutional articles, ANA says

And just when the HFT momentum algos were ramping everything like you won't ever be able to buy below 1400 again...

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More Greek Drama: Coalition Member PASOK "In Turmoil As It Seeks To Quell Rebellion"

Submitted by Tyler Durden: First it was news that Europe's weakest link may be broken following a Greek court doing the unthinkable, and actually enforcing the constitution, and now we learn that in addition to at least one definite defection from the Greek coalition government - PASOK (as reported earlier), the entire party is now on edge as its leader, former PM Evangelos Venizeloz seeks to quell a "rebellion" ahead of next week's vote which will hardly make the government any more popular in the eyes of the general population. From Kathimerini: "PASOK has plunged into turmoil as one MP and a prominent official quit the party following a fractious vote on the government’s privatization bill on Wednesday. The draft law paving the way for the sell-off of a number of utilities and ports passed narrowly and the failure of 17 PASOK MPs to support the legislation led to party leader Evangelos Venizelos, who failed to take part in the vote himself, calling an urgent meeting with his 33 lawmakers on Wednesday evening." Why is this relevant? Because two days ago, as reported, the third member of the ruling coalition: the Democratic Left, which mans 16 votes, announced it would vote against the Troika demands. This leaves the coalition with 160 votes on a matter in which it needs a majority. Should Pasok's 17 votes also be in danger of pulling out (assuming nobody from New Democracy votes no), then one can see why Greece may once again hold the fate of the Eurozone in its hands just as the US is voting for its next president and hardly needs more European drama.
More:

Journalists were barred from the talks but the angry exchanges between party members spilled out into the street.

“Today in Parliament, we were like a lost herd,” said Cretan MP Nikos Sifounakis. “If we continue like this, the measures won’t pass. The government and PASOK will collapse.”

Following the meeting, MP Michalis Kassis said he was quitting the party but remaining in Parliament as an independent MP. He said Venizelos left him with no choice as he told deputies that whoever fails to vote for the upcoming fiscal and structural measures would be ejected from the party.

Kassis accused some of his colleagues of only supporting Prime Minister Antonis Samaras and the coalition government because they want to become ministers.

He also told journalists that several more PASOK MPs intend to vote against the austerity package in Parliament. The vote is likely to take place next week. The three-party government had 177 out of 300 seats after already losing one MP from New Democracy and another from Democratic Left, which insists it will not support the latest package unless the troika backs down over labor reforms. It now has 176 seats.

Former Agriculture Minister and once a candidate for the PASOK leadership, Kostas Skandalidis reportedly clashed with Venizelos over his handling of the party and refused afterwards to dismiss suggestions that there might be a challenge mounted against the party president.

On Thursday, former minister and PASOK secretary Mariliza Xenogiannakopoulou announced she was quitting the party.

Of course, we wish we could say vocal discontent ahead of a critical vote seeking to preserve democracy is something new in Greece, especially with everyone promptly following just as Merkel demands, but we can't. And also, why worry: after all didn't Bernanke say he can get any lawmaker to vote in a way that is compliant with the demands of the status quo after just 15 minutes alone with them?
Or was that ending hyperinflation? These days everything just blurs into one.


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