The second Greek bailout is not a gift. It is a one-pronged austerity drive with no provision for growth. If the Eurozone is to be kept intact, Peripheral Europe will need a plan on the lines of the “Marshall plan,” which engendered the highest rate of economic growth in European history, to carry out reform. The ECB’s two rounds of cheap funding, LTRO, have not eliminated the risk of systemic failure, they have merely taken it off the table. Let’s keep in mind that a trillion Euros of additional bank debt will make any systemic failure in the future even greater than the one we are faced with today. Whether the LTRO liquidity is used by banks to pocket the spread on the carry trade, or lend more to the real economy, will shape what direction the crisis takes next. While I feel encouraged by the improving macro conditions, particularly in the US, and the risk to the market remains more to the upside than the downside, elections in April and May in Europe could cause volatility. The historical strength of the Japanese Yen has hurt the Japanese Equities market in the past, but recent JPY weakness could be here to stay, with the Nikkei being the prime beneficiary.