Brown Brothers Harriman: Euro to 1.18, Greek Bailout is Disguised Bank Bailout (Marc Chandler)

Marc Chandler, global head of currency strategy at Brown Brothers Harriman, was on Bloomberg on May 4 talking about the Euro and Greek debt bailout.  By the way, rioters tried to storm parliament today protesting the austerity measures and EUR/USD broke below 1.31 support.
  • Euro is still headed lower, in short run expects Euro consolidation
  • It's not really bailing out Greece, it's a disguised bank bailout. (IMF money -> Greece -> Banks)
  • 70% of Greek bonds owned by foreign investors
  • Pain of servicing debt will be so great that foreign investors will choose debt restructuring
  • Over time Greece will want weaker Euro to stimulate exports (foreign demand)
  • Sees EUR/USD at 1.25 in short term and ultimately at 1.18-1.19

See recent posts on EUR/USD.  From my chart, before EUR/USD can hit Chandler's target of 1.18-1.19, it must successfully break through 1.246 using the late 2008/early 2009 lows.

EUR/USD (Euro vs. US Dollar) Courtesy of