If, as the saying goes, you are judged by the company you keep, Greece is running with the wrong crowd.
Despite European Union officials dismissing talk of a debt restructuring and reportedly boosting the size of a joint aid package with the IMF, traders of credit default swaps on Greek sovereign debt have taken a dim view of the country’s ability to service its debts.
A year ago, Greek CDS spreads traded in a similar range to Israel and Malaysia. Today, the spreads on Greek CDS place the country in very different company. Sandwiched between Ukraine and Argentina, Greece is now among neighbours who are no strangers to default.