The timing of this is pretty bad if you think about it. Summer vacation period is coming up and hundreds of thousands of Europeans would be going to Greece in May, June, July, and August. Planes would be lined up in France, Germany, England, and the Netherlands.
If suddenly your planes (ever so carefully made) had to deal with some vast change on currency...then you’d question the idea of going to Greece. I’m betting it’s an all-time low record of folks with plans for a Greek vacation this year. Hotels will likely be half full, and the revenue that they would have made....is non-existent.
The Financial Times discussion board is on fire with today’s news. What I find utterly amazing is how many people still think they can salvage the Euro through stimulus spending. It was doomed from the start when they based it on an aggregate of members’ fiscal policies. There should have been an iron-clad, no-excuses-whatsoever policy that members commit to eternal balanced budgets with neutral-party auditing to ensure compliance. Unfortunately that would have ruled out have-your-cake-and-eat-it Socialism but it would have been the only way for the Grand Project (tm) to survive.
In the end the problem is cultural. In the U.S. We out of necessity had to develop a can-do, self-reliant culture: you cannot tame an unexplored continent any other way. The Euros haven’t had been faced with that for millenia.
Thinking about it, this guy does make a little sense. I can see the rest of the monetary union declaring that all Greek issued Euros are null and void. Or the possibility that a Greek issued Euro be pulled and the corresponding value as a Drachma issued to the holder of the note.
In any case when it comes to money, bankers are really tight and won’t willingly lose a cent to the customer. I feel that the Europeans are in for a very rough ride soon and I am praying that the rest of the world doesn’t become embroiled in another one of their wars.
Looks like they are at Stage 5:
1) Denial: Greeks leave the Euro? Surely you jest!
2) Anger: Why do you even spread such nonsense! You will spook the markets!
3) Bargaining: Look, we'll lend you millions of Euros if you stay with us.
4) Depression: What went wrong? We helped them out in every way we could. We see no way out. Maybe another loan . . .
5) Acceptance: German chancellor Angela Merkel conceded for the first time that Greece could be forced to quit the euro