Greece Defaults

[scooterscot]

2. Greece introduces the new drachma and starts paying its obligations (public sector wages and any bonds it hasn't defaulted on) in the new currency, but any existing individual or corporate bank deposits in Euros remain in Euros.

I don't disagree. But logistics is a problem when a packet of digestive biscuits costs 34,323,000,000,000,000,000,000,000.00 drachma.

They'll never go back. Just a feeling, more likely Germany and France shall take over the Greece government before that happens.

[OwlHoot]

Greece needs to corner the european holiday market to bring in loads of lovely money. They've got the facilities and sunshine, just need the low prices.

Maybe a default and going back to the drachma will help that.

They could sell us the Parthenon for a start.

I mean we already have the Elgin Marbles, so we may as well have the rest, and move it stone by stone to Primrose Hill or somewhere.

[minestrone]

They will never go back to the drachma. They just have to be booted out the system and be regarded as a nation without a currency. It will cause bother in the short term but it is the only way to sort the problem out.

[Doggy Styles]

They could sell us the Parthenon for a start.

I mean we already have the Elgin Marbles, so we may as well have the rest, and move it stone by stone to Primrose Hill or somewhere.

Primrose Hill? Posh Londoners get enough perks already.

What's wrong with Sefton Park? No, scratch Sefton Park, it would all disappear within a few days. What about Ivinghoe Beacon?

[eek]

They will never go back to the drachma. They just have to be booted out the system and be regarded as a nation without a currency. It will cause bother in the short term but it is the only way to sort the problem out.

You're right as I don't think they can go back to a currency no one will want. It will be like visiting Turkey until abojut 2005 when everyone wanted Euros and Dollars and their own currency was something only local shopkeepers accepted under duress.

The problem is that I don't think there is a mechanism to boot a country out of the single currency (or even for a country to leave it). The plan only had a single direction and risk assessments with appropriate contingency plans were ever thought about. It very much was if we build it, it will work and no one thought of the consequences of countries simply treating it as an bottomless piggy bank.

[eek]

They could sell us the Parthenon for a start.

I mean we already have the Elgin Marbles, so we may as well have the rest, and move it stone by stone to Primrose Hill or somewhere.

Wouldn't it be better to use it to finish the national monument in Edinburgh. See National Monument, Edinburgh - Wikipedia, the free encyclopedia

As an aside given what happens to all infrastructure projects in Edinburgh (this, the Scottish Parliament building....) why on earth did they think they could build a tramway.

[Incognito]

Slightly OT, but what an example of the right way to handle a crisis

Iceland Shows Ireland Did

What a message to send out to the rest of the world

**** the lot of you, if you were stupid enough to lend to them without doing your due diligence then take the pain

[MarillionFan]

Well equities nearly up 2% so obviously they dont think Greece is going to go bust.

So I'm going to bail out a day early.

[Le Rosbif]

[Rosbif prediction mode on]

The question is not if Greece will default but when.
Same goes with the Eurozone.

The greek crisis clearly has taken an uncontrollable turn and default can not be avoided anymore, only slowed down. It might happen as early as end of October but will probably happen in november or december 2011.
Greece needs to provide 340 to 380 billion euros between 2012 and 2019 (without taking into account eventual increase of its deficit)

Germany has in a way already accepted Greece to leave the eurozone as it's been shown by its support plan to its banks.
It's also clear that many financial institutions are getting prepared to the end of the eurozone.

Days after Greece leaves the Eurozone, speculation will run haywire against Portugal, Ireland, Spain and Italy (maybe Belgium?)

Combined with a social crisis in Spain, it will force Spain to ask for help to the EFSF (European Financial Stability Facility) for ammounts exceeding largely what is now forecasted.

Besides Greece, the cash injection required to keep the countries afloat can be astimated to 90b for Portugal, 50b for Ireland, 250-300b for Spain - a total of 390-440 billion

In these condition Germany's contribution would be 2-4% of its GDP over 7 years - This would be unacceptable for Merkel unless she wants to commit political suicide.

For the above reasons European particularly exposed to junk bonds capitalization has dramatically plunged since the beginning of August. In France, Societe Generale and Credit Agricole have already been downgraded by Moody, the next step beeing the downgrading of France itself.

That's why Sarkozy is pushing so hard to try and prevent Greece to default.

And that's why Merkel is not.

[Rosbif prediction mode off]

[TimberWolf]

Who has done best out of Greece being in the Euro? Greece, EU, speculators or other? And who the worst?