Europe's firewalls may not be enough to stem Grexit investor panic

For all the firewalls Europe put in place over the last three years, the actions investors say they would take if Greece left the euro currency bloc suggest the ensuing panic would rumble through financial markets. The imminent launch of a bond-buying scheme from the European Central Bank has so far quelled the anxiety that in 2012, when Greece last looked set for the exit, prompted a steady stream of money out of the euro zone. Investors say the euro would take a hammering as foreign funds sought shelter in U.S. and British assets, euro zone stocks would fall, and borrowing costs in the bloc's low-rated countries would soar as those obliged to stick with Europe tried to stem losses by buying German government bonds. "A lot of international investors would use it as an opportunity to just sell to the ECB and leave the euro area, similar to what we have seen before," said Patrick O'Donnell of Aberdeen Asset Management, a fund with over 400 billion euros under management.



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