|Greece Ready for Return of Drachma|
|by Tom McGregor||Mon, Jun 11, 2012, 06:35 PM|
Political winds are shifting in Greek politics, which may soon mean the Greek departure of the euro and the return of its drachma currency.According to the BBC News, “Greek voters could this week hand power to anti-austerity parties who want to scrap the bailout, the deal that qualifies Greece for vital eurozone funds.”
This could bring the nation closer to its inevitable withdrawal of the euro. Yet, how could the drachma currency get re-introduced?
As reported by the BBC, “a new government would have to produce enough new notes to replace those currently in use in Greece while also doing their best to prevent a run on banks.”
Accordingly, it must be introduced during a public holiday along with an interim phase between currencies.
written by Jaime Shady , June 12, 2012
This will never happen. If greece switches currencies the strain on public finances will be more than if they keep the euro since their debt is denominated in euros. The inevitable devaluation of the drachma would make it even harder to pay back their loans. They will let their banks fail. Then do nothing. It would be easier to put laws in place that provide food for retirees and ban evictions. Unsound businesses and banks would just go out of business. This is capitalism. If you are curious as to how this would work study the economy of costa rica.
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