Any Bets The Greeks Will Put The World Into Another Recession???

Chad · Post by **Chad** » Thu Nov 03, 2011 11:42 am

First, based on all the information out there if they default 100% the EU is going to basically kick them out. Especially, after the Greek PM just played Merkel and Sarkozy. They aren't happy with that. Thus, the Drachma.
No such thing as an import driven economy.
They can export cheap wages all they want, just not to the EU if they aren't part of it. The EU will throw up substantial trade barriers.
Of course, they won't have cheap wages if they stay in the EU and keep the Euro.
Also, no need to redue the entire tax system. Most of it would be fine, as most of it will be percentages or if it was a flat fee in Euros the currency market would set the Drachma amount. The import regulations wouldn't be a big issue, as I'm sure they already have current ones for non-EU members, now they would just add EU members to the list.
The black market is irrelevant to all of the above, as it exists and will continue to exist no matter if Greece stays in the EU/keeps the Euro or leaves the EU/100% default/Drachma. It's existence is independent of the decision. Not that it isn't a problem, but the problem exists either way.

simplex · Post by **simplex** » Thu Nov 03, 2011 12:04 pm

@chad

There is a big difference for Greece between leaving the euro (eurozone) and leaving the EU. Not all members of the EU have the euro (e.g. UK, Romania, Bulgaria). So Greece might dump the euro but still stay in the EU.
By import driven economy I meant something like the tourism industry. It needs imports and locally provides a service (so no exports). Maybe this term is my own invention.

dgforthree · Post by **dgforthree** » Thu Nov 03, 2011 12:32 pm

Any chance that Greece DOESN'T default and leave the euro now that they've decided on a referendum? No way that the Greek people will get a simple majority after the protests that have been ongoing, but I could be wrong!
I think that I'll start planning "my big fat Greek" vacation

for when the inflation starts.

Dragline · Post by **Dragline** » Thu Nov 03, 2011 2:31 pm

I think Greece is still likely to default even if the referendum passes. It's just a matter of timing. The Greeks would be better off in the long run it they just went and got it over with now.

FrugalZen · Post by **FrugalZen** » Tue Nov 08, 2011 1:02 pm

Yes they are likely to default anyway..but they've pulled the idea of the referendum after Merkel and Sarkozy (I'm sure) gave the Greeks an ultimatum...."you have a referendum and you get no money...and we don't care what the outcome is".
So much for the planned cheap vacation...Sigh!!