"Athens Mulls Plans for New Currency: Greece Considers Exit from Euro Zone"

[bullmoose88]

http://www.spiegel.de/international/europe/0,1518,761201,00.html

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[Landslide Lyndon]

Another case of unmitigated nonsense. I didn't expect anything better from a rag like Spiegel.
For the record there has been a barrage of denials during the last hours, including Merkel, Trichet and of course our government.

[2952-0-0]

Another case of unmitigated nonsense. I didn't expect anything better from a rag like Spiegel.
For the record there has been a barrage of denials during the last hours, including Merkel, Trichet and of course our government.

Sure, but given the amateurish way the crisis has been addressed, it will be hard to absolutely deny the report.

[Grumpier Than Uncle Joe]

[Landslide Lyndon]

Another case of unmitigated nonsense. I didn't expect anything better from a rag like Spiegel.
For the record there has been a barrage of denials during the last hours, including Merkel, Trichet and of course our government.

Sure, but given the amateurish way the crisis has been addressed, it will be hard to absolutely deny the report.

No, it's not hard at all. For a country to abandon Euro it is as feasible as a US state seceding.
There is no legal provision for something like that to happen.

[2952-0-0]

Another case of unmitigated nonsense. I didn't expect anything better from a rag like Spiegel.
For the record there has been a barrage of denials during the last hours, including Merkel, Trichet and of course our government.

Sure, but given the amateurish way the crisis has been addressed, it will be hard to absolutely deny the report.

No, it's not hard at all. For a country to abandon Euro it is as feasible as a US state seceding.
There is no legal provision for something like that to happen.

The problem is that Greece and the ECB have their credibility tarnished, and any of their words cannot be taken for face value. And just because the law does not permit abandoning the Euro does not mean it is impossible to do so de facto, perhaps by introducing a parallel, officially unofficial unit. After all, almost every Eurozone member has repeatedly failed to keep their public deficit within the Eurozone limits, and did so without consequence.

Perhaps if the ECB acted decisively to open the books of all Eurozone states, they would have more credibility now. But if there's one thing true in economics, it's that perception is reality.

[True Federalist (진정한 연방 주의자)]

For a country to abandon Euro it is as feasible as a US state seceding.
There is no legal provision for something like that to happen.

I doubt that the other Eurozone members will go to war to force Greece to remain in the Euro.

The thing is, at this point does Greece really have anything to gain by staying in the Euro?  Certainly if I were in the Greek government, I'd be studying the option and be ready to use threat to leave the Euro to extract concessions from other Eurozone members.

[Seattle]

Certainly, getting rid of the euro would be the "easy" way out of economic crisis (as if there is one). The Greek government has a chance to try and radically reform Greece's economy..... which would probably mean political suicide if they tried, but at least would improve the longterm stability of the country's economy.

[Landslide Lyndon]

Junger just talked to the media after a EU meeting at Brussels and called the whole Greece-leaving-the-Eurozone idea an idiotic one.
Trust me folks, it's never going to happen for a million different reasons.

[True Federalist (진정한 연방 주의자)]

Junger just talked to the media after a EU meeting at Brussels and called the whole Greece-leaving-the-Eurozone idea an idiotic one.
Trust me folks, it's never going to happen for a million different reasons.

Which Junger?

In any case, Greece leaving the Euro is a lot more problematic for the remaining Eurozone countries than it is Greece, so it's no wonder a Brusselscrat would be opposed to the idea.  (Not that leaving the Euro would be the wise thing for Greece to do long term, but they might not be able to keep together the political will needed to do so.)  It's why by using the threat to leave judiciously, Greece might be able to extract concessions despite its weak economic condition.  Of course, if they do overuse it, they risk being shown the exit from the Euro once the Euro is back on a stronger footing than it currently is.

[GMantis]

Not an economist, but withdrawing from the Euro has obvious advantages for Greece as it would permit their currency to devalue to its real value. This is often cited as the reason why Iceland was able to recover faster from the crisis than Ireland.
Of course that would reduce confidence in the Euro, so it's really the other Eurozone members and especially those better of who are so strongly opposed to this.

[Landslide Lyndon]

Not an economist, but withdrawing from the Euro has obvious advantages for Greece as it would permit their currency to devalue to its real value. This is often cited as the reason why Iceland was able to recover faster from the crisis than Ireland.
Of course that would reduce confidence in the Euro, so it's really the other Eurozone members and especially those better of who are so strongly opposed to this.

It would also mean that our banks will collapse and people will see their money lose almost half their value.

There is ZERO chance that Greece (or any else country of the Eurozone for that matter) withdraws from the Euro and reinstates a national currency. If you're in, there is no way out.

[Insula Dei]

Also, and bear in mind I'm not a financial expert, but wouldn't that mean Greece can say bye-bye to its Eurozone support?

[True Federalist (진정한 연방 주의자)]

Also, and bear in mind I'm not a financial expert, but wouldn't that mean Greece can say bye-bye to its Eurozone support?

And if Germany and the other reasonably well-off Eurozone countries cut back on that support anyway?  At present, it makes sense for all sides to work on keeping the PIGS in the Eurozone, but that won't necessarily hold true forever.  Making plans on how to bail on the Euro are prudent preparations, even if never carried out.  The interesting question is whether Greece would go back to the old drachma at the peg used to convert to the euro, or simply go with an overnight conversion of all bank accounts and loans at a rate of 1 old euro = 1 new drachma.  Probably depends on whether the Greek government stored the old currency withdrawn from circulation or had it recycled.  One would be simpler while the other could be done more quickly and with less advance notice.

[Gustaf]

The problem for Greece would be in building credibility for a currency of their own. That's why Club Med was so positive to the euro to begin with.

I'm all for a eurozone breakdown so I'm pushing this rumor.

[The Mikado]

Greece wants to become Zimbabwe? 

[2952-0-0]

Greece wants to become Zimbabwe? 

Nope, Argentina.