Now things get interesting. If you listen carefully, politicians and central bankers suddenly seem to signal an imminent debt restructuring for Greece. Everybody except the rating agencies seem to get the memo.

According to a Sunday newspaper, Greek Deputy Prime Minister Pangalos uttered the fatal sentences: “Debt exists to be restructured. We may pursue it ourselves or the option may be offered to us and it could be in our interest to turn it down.” Of course the opposition was going ballistic, calling for Pangalos’ dismissal.

Meanwhile, over at the ECB, executive board member Bini Smaghi does “not rule out the possibility that a country will not be able to repay all its debt”.

Pouring oil into the fire, German Chancellor Merkel added: “We must keep in mind the feeling of our people, who have a justified desire to see that private investors are also on the hook, and not just taxpayers.

For those who still did not understand, Bundesbank and possible Trichet-heir Alex Weber: “Next time there is a problem, bondholders should be part of the solution rather than part of the problem. So far the only ones who have paid for the solution are the taxpayers.”

Only the people at Moody’s didn’t get the memo; “The eurozone economies of Greece, Portugal and Ireland are likely to avoid sovereign bond defaults because of a strong domestic investor base of local banks and pension funds that will buy their government’s debt even in times of stress.” Moody’s further reasons that “The 20 sovereign defaults since 1997 were all in emerging market countries” which had high foreign currency exposure. “In the case of Greece, Portugal and Ireland, their debt is almost entirely in euros, their domestic currency”.

That is, until the Euro is NOT their domestic currency anymore.

Moody’s analysis will be overtaken by reality – 10 year Greek government bond yields increased from 9.4% to 10.7% with a week:

10yr Greek government bond yields. Source: Bloomberg.com