Greece's Debt Nightmare Just Got Worse http://finance.yahoo.com/news/behind-calm-athens-greeces-debt-101455439.html
Probably why Greece recently signed on to the Financial Transaction Tax. They'll go along with just about anything... perhaps even sacrificing their young... ANYTHING to get some more money!! The "entitlement mindset" will eventually be broken... but not until blood runs in the streets... literally! Not meaning that just for Greece/Southern Europe... AMERICA TOO!!
Let's accept one simple reality -- Greece has no intention whatsoever to repay any of the debt. Get on with it.
Thier intention is irrelevant. They are insolvent. All the purported 'solutions' are all about creating liquidity for defaulted, insolvent, debt. That can never solve the problem. Even if the accumulated soverign debt was forgiven there is no way to fund the current and future deficits; even if you start over. Apart from an inability to pay its accumulated debt, Greece can not afford to pay back any new debt either. You cannot borrow money to fund social welfare consumption and pay pensions at the same time that you drive private production out of your economy, and have any way of ever paying that money back. I can't believe the Germans will really stand for the ECB selling German debt that must be paid back, in order to fund the purchase of Greek debt that can never be paid back. This is going to get much worse than people think...and I know they think it will be pretty bad.
so do you think the ultimate result will be a reintroduction of the drachma? They let Greece go and try to save Italy? Hard to imagine that without the EUR going way, way down. otherwise, any scenario where Greece will stay in the Eurozone?
Going back to the Drachma is not a solution for Greece. In order to have a currency, you have to have foreign credit to back it up. Greece has no credit. If it introduces a devalued currency, that currency will fail and turn into hyperinflation. Greece has to stay on the Euro in order to make transaction commerce from becoming even worse. Greece is going to get dramatically poorer no matter what they do.
joining the Eur is sort of like joining the Mafia, once you take the oath, there aint no going back. Funny how CHF said, "Nah, I think we'll pass this time."
Going to the Euro allowed the Greeks to borrow money at a AAA rating even though they had no way to pay it back. That is hardly like joining the Mafia. Its more like if you imagined that Obama would start a program of unsecured loans for the homeless that were guaranteed by the shop owners of the stores on sidewalks on which the homeless were living.
True but the added advantage to the shop owners is it makes their goods less expensive to sell abroad. This is what it does for Germany. Their success is based on Greece's failure.