Domo, it seems to me that either returning to the Drachma or staying with the Euro, the Greeks will have to lower their standards of living.
At least within the Eurozone, Greece is getting financial help from their partners and doesn’t have to unilaterally default.
Things would be different if Greece had never joined the Euro (they would not have been able to borrow so much). Getting kicked out would be humiliating and will marginalize Greece from Europe for decades.
With Ireland and Greece the standard of living increase they enjoyed in the last decade, fueled by bad debt, was artificial and unsustainable.
Hard as it is, just like American homeowners, it’s best to return to a more modest way of life and sustainably build from there.
Iceland is still paying for the bailout of its banks. And Argentina is growing thanks to commodity exports. Can you think of anything that Greece has to sell to the world other than tourism?
IMO, Greece’s economy is not setup to greatly benefit from a cheap currency.
Anyway, it’ll be interesting to watch the events unfold.
[quote=DomoArigato]…and being forced to pay back debt accrued by the top 1% …[/quote]
How are you so sure the debt was only accrued by the 1%? You realize the country has a tax avoidance problem, right? Do you think only the 1% took out any loans? Do you think none of the 99% benefitted from social spending?
Why does it matter to you whether holders of Greek debt get a bailout? Did you make a bet that the EU would try and force Greek taxpayers to make good on that debt and lose?[/quote]
Wow, my sympathy for the OWS crowd has just gone down by 53%.
Why does it matter to you whether holders of Greek debt get a bailout? Did you make a bet that the EU would try and force Greek taxpayers to make good on that debt and lose?[/quote]
Wow, my sympathy for the OWS crowd has just gone down by 53%.[/quote]
AK: Well played, sir! I was howling when I read that.
I expect this to severely damage the Euro. and the dollar. The question is, will this be the death of the dollar or will the Federal Reserve continue to intervene, just kicking the can down the road? Time will tell.
