Saturday, May 12, 2012

EUSSR: Greece and the Euro, Here Be Dragons

With one week of coalition negotiations under the fustanellaspeculation is rife what's next for Greece. The Greek electoral law is proscribing new ballots: the date of June 17 is circulating. Parachuted technocrat PM Lucas Papademos vitisited the president of the republic this morning on "Issues that Urgently Need to be Addressed". Actually quite a few and not all routine chores either - listed here on Zerohedge #BBBbbbbrrrr
The eurocrats meanwhile were sending terrifying signals of denial and evasion this morning ranging from "please walk on, nothing to see here" to "The European Commission said there are initial signs of a recovery..." in the face of a devastating report published by the Commission itself.
This is terra incognita, folks! Here be dragons!
Were it not for the eurocrats being deeply entrenched in the euro project using it as a political leverage tool for "ever greater integration" against the will of the peoples, @GHollidge has a few interesting suggestions in "What would the British do?":
Many don't understand that Greece, though it should, can’t simply leave the monetary union that it finds itself stuck in. The problem being, A, it has no money and is on a drip feed from its new paymasters and B, It has no other currency to fall back on. Now it does have radical choices, tell everyone to do one, default on all, re-introduce the drachma [devaluate: CT] and be locked out of the financial markets for years to come. Sounds bad, but some of this is off set by a low currency making it ideal for family holidays; huge investment would come in forms of private investment. Added with structural reforms and low corporation tax it now starts to look like a good place to invest in. Another idea would be for Greece to keep the euro as a trading currency. This having the advantage of being able to trade more freely with Europe and all the other bells and whistles that come with it. Greece would reintroduce the drachma as a non-tradable currency, then peg it to a country with a similar economy. These parallel currencies have their advantages too. Greece has regained control over its currency, making it able to devalue internally, while still get its drip feed money that it needs.
Regrettably no such practicalities are on the cards with the present ideologues in charge. In the end though, while you can ignore reality for as long as you want, you can't isolate yourself forever from the effects of ignoring it.
No sooner had it become obvious that the extreme Left Syriza party will turn the second instalment of the Greek elections on June 17 into a formal exit of the EU or the troika blinks and enters into a game of bazari...that is unless it's a canard *LOL* Zerohedge: "Europe Blinks: Troika Willing To Change Terms Of Greek Bailout Deal": IMF, EU, ECB Open to Changes in Greek Aid Deal, Real News Says (...) >>>