Heard it on the news, is it official, is this it?
It is from what I hear, preparation for the inevitable?
Here we go, Dracheurs? Drachos? Drachyma? Dracho?
Nope, you heard wrong, we are still in. I just had an ice cream for 1 euro 
I think the article about Greece exitining the euro at the main page of Reuters currently was the one that got misinterpreted. If it happens it will take place during a weekend anyway…
I think that there is an EU meeting going on today, and one of the possibilities on the table is Greece leaving. The Greek Prime Minister acknowledged that it was an option. But certain other EU member states are likely to push for more bailouts etc. to stop them leaving, so not sure that we are in the endgame just yet, personally.
However if they do leave, and to answer PPF’s question, I personally hope that they go with Galactic Credits. I have been wanting those to get into circulation for some time.
(Snazzy new avatar, by the way, PPF!)
ST
So If Greece leaves over a weekend, how many pips down do you think the eur/usd would drop?
Hasn’t happened yet, but it WILL happen.
Where there’s smoke, there’s fire. And there’s been a lot of smoke on this subject lately.
When it occurs, it will likely be temporarily euro positive. That is until they figure out in a year or so, that there’s not enough money in the world to fix Spain, Italy, and France.
Once that happens, you will need to “haf ze papers” to travel in Europe any more.
Germany will be trying to collect on loans.
If they can’t take olives, they’ll take the farm that grows them.
GS gives it a 75% chance in the next year and that was a few months ago. no exact date or what needs to be prepared so the countries still in can firewall themselves. Def this weekending meeting will be a huge indicator.
I would say the opposite. A greek exit would affect the euro negatively in the short term as a door opens for the exit of other countries such as Italy, Spain and Portugal. If the greek exit (having a minor 2% GDP of the eurozone in total) costs the european countries some hundrends of billions in debt, imagine what it will cost if Italy for example exists. In the long term, if the euro survives and the economically strong countries are left only, then yes, it will affect the euro positively.
i agree with rogopip. the euro will eventually be stronger when theyre not carrying all this dead weight. over the short term not so much…
Notice I said “temporarily”. It will likely rise on demand as people close out accounts, and bonds.
And just for the record, if Italy, Spain, and Portugal exit, there will be no more euro. Period.
Even if the euro project DID survive the exit of those countries, there would be no more economically strong countries left.
The survivors would then be in the same shape as the PIIGS are right now. Germany wouldn’t stand pat on incurring that kind of debt.
They’d say screw you guys, we’re dafuggoutta here. And if they go, there’s no euro anyway.
It’s on it’s last legs.
I got an interesting bit of information on how they structured the euro from an unlikely place. I was watching “Anthony Bourdain: No Reservations” and he was in Portugal. The smart old geezer he was talking to told him how that there were no real productive farms left in the middle of the country, and that region had been fairly gutted by the government to be included in the EZ. The reasoning was, if Greece grew more olives, Portugal couldn’t grow any, so that Greece would be able to export more. Same with oranges, and some other crops.
Now how is that helpful in any way? What a stupid way to run a railroad…
It has been devastating economically because of rules like those. And it’s been going on for a very long time.
If that has been the case, they doomed the whole deal from the start. You can’t have viable economies if you gut half their domestic product right off the bat.
Cork trees alone can’t carry an economy…
MT… don’t get me started! LOL!!! I remember when the UK enforced a rigid fishing exclusion zone around its coast to protect fish stocks. Upon joining the EU, Spanish fishing fleets moved in wholesale and decimated numbers and all but killed off the industry. Now it seems just about any second world country (former Eastern block ex comunist countries) can join the EU club, take huge EU grants to build up thier economy whilst its younger population migrate on mass to the richer countries and hoover up all the jobs at lower wages. As I recall, the EU was only supposed to be about cross border trade… what the hell went wrong?
Politicians.
We have a government without a backbone. Not capable of making tough decisions that may upset a few people. Its all about spin these days, no ideology in politics, and no party that would stick to it anyway.
Another question I have is: would the eur/usd start sinking 90 degree down just on the opening a Monday (if decided over the week-end), or would it in fact not drop too strongly, and not for long, because of the domino effect on other currencies?
the estimated cost of Grexit is apparently $1 Trillion, but it would also cost a fortune if they stay in the EU. Is this a clear example of a lose lose situation?
European Governments spent years coming up with a strict set of criteria for entry into the Euro, to ensure (as far as possible, which is not very far) economic compatibility. They then promptly relaxed these rules for political reasons, preferring to let Greece into the Euro than see Greece/Turkey/other countries in that region move further towards the Middle East. There has been a sense for some years now in government that most countries need to associate themselves with a larger trading/political entity. So for political reasons those financial criteria were ignored.
This is the natural and inevitable product of politics overtaking sense: the Greek economy was never up to the standard required to blend well with those of other EU countries, so it was always going to be a case of permanent and ongoing subsidies to fudge the natural gap in the numbers. So the first major recession to hit was going to shine a bright light on the issue and lead to the issues the EU is now confronting.
Whatever one’s political opinion of the Eurozone, the simple fact is that, judged on the hardfought criteria established, Greece should never have been brought in, and does not have an economy that works in that context. Everything from tax regime/tax collection up is out of step with that desired by those running the EU. So we are faced with the current crisis, where there is a need to choose between two vastly costly and embarrassing options. When confronted with that, the vast majority of politicians prevaricate and let the issue drift rather than taking a firm, clear and definitive stand. We have seen that in recent weeks both at EU level and among the individual political parties within Greece.
So yes, it is a lose-lose situation, and it was inevitable that it would come to this when the Euro entry criteria were relaxed for political rather than economic reasons to welcome Greece into the EU fold.
A pretty sad and embarrassing episode in the shaky history of the EU.
But I am almost more sad that the horrible slang ‘Grexit’ appears to be creeping into the lexicon. It’s a sad period for language, too!
Anyway, just my thoughts, as one who used to work with a number of governments.
ST
Greece just made up the numbers didn’t they? If they were a private company, someone would have ended up in jail.
Well with that in mind it might be cheaper to just build a wall around the whole country to keep all there BS in
Greece did make up the numbers. And certain -german in particular- companies helped in the making up of the numbers, making billions in the process. It is our fault 100%, we were living an illusion, but I can t believe than one day everybody woke up finding out that suprisingly we are standing at the edge of the cliff.