The term Troika has recently become synonymous with (politically motivated) economic destruction and social hardship. I doubt that the average youth on the street sees the IMF/EU/ECB Troika as a force for the good. Nor would he comprehend the comically over-optimistic tone delivered by one of its cheerleaders, president Barroso, in his recent State of the Union speech. The ‘Union is in a right State’ would perhaps be a more appropriate title, but why bow to harsh reality when grand rhetoric sounds so much better?

We are told that “Greece has completed, just in three years (sic), a truly remarkable fiscal adjustment, is regaining competitiveness, and is nearing for the first time in decades a primary surplus”. The naive might infer that Malta will therefore succeed in getting its money back, but a search for the True Cross probably has a better chance of success.

“So let us continue to work together to reform our economies, for growth and jobs.”

This suggests that simple extrapolation of the trend will result in unemployment falling further, and the economy continuing to grow. The reality is that the Greek economy continues to shrink, down 3.8 per cent year on year in the second quarter. Unemployment is on an upward trend, currently running at 28 per cent. Under-25 unemployment is 59 per cent. If we extrapolate those trends, there will soon enough be no headroom for further extrapolation.

“It is the way to ensure that taxpayers are no longer the ones in the front line for paying the price of bank failure.”

Recall that Greek workers have been subjected to tax hikes and pay cuts as part of the rescue package. Their ability to service their mortgage has therefore been curtailed. One would think that a good ex-Communist like Barroso would come riding majestically to the rescue of the worker.

However, the Troika is pressing for a lifting of the ban on banks repossessing homes worth more than €200,000 if the mortgage is not being serviced. This will effectively mean people being thrown into the street, to keep the banks afloat and avoid yet another bailout – how does that reconcile with the grand vision of European social solidarity? In any case, who will be able and willing to take on debt to purchase the vacant property? An aggregate net loss does have to be incurred – but it is remarkable to what extent the average man in the street is incurring it.

Barroso added that “citizens will not be convinced with rhetoric and promises only”. He is at least right in that. The Troika has yet to prove that its medicine will work efficaciously.

Thankfully, Malta has avoided the unwelcome grasp of the Troika. Not all troikas are bad of course. History has a number of positive references to things coming in threes: the three wise men; the troika of philanthropy (ironically of Greek etymology), humanities and liberal education during Roman times; Manchester United winning the treble in 1999.

The Malta Stock Exchange has been quietly breeding a remarkable troika of its own. Shareholders of RS2, Crimsonwing and 6pm have enjoyed spectacular returns over the past 12 months: RS2 up 266 per cent from 52c to 185c, Crimsonwing up 185 per cent from 26c to 74c, and 6pm up 91 per cent from 32p to 61p.

The half-yearly results showed solid improvements, and all three have bright prospects which should allow them the scope to keep growing. The turnaround in their fortunes has been quite extraordinary, and it is encouraging to see local investors taking a renewed interest in equities.

This article is the objective and independent opinion of the author. The information contained in the article is based on public information.

Curmi and Partners Ltd is a member of the Malta Stock Exchange, and is licensed by the MFSA to conduct investment services business.

Martin Webster is head of equity research at Curmi and Partners Ltd.