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|#186310 - That's exactly the solution ... however ...|
Responding to: Per Westermark's previous message
The Euro-zone would suffer extensive consequences if Greece were to withdraw from the use of the Euro, most notable due to the loss in confidence in the common currency.
Devaluation of Greek currency, i.e. return to the Drachma, would solve part of their problem, but the real problem is in getting a handle on the corrupt practices, starting from within the government, and those which have spread from the government into the "culture" of the society. Similar problems exist in Spain, Portugal, and, above all, Italy, where the practice of income tax evasion has become a national sport. Italy is a large economy and barely able to hang on with its fingernails, so all these countries in nearly so much trouble as Greece need to be handled very delicately. If those five countries go the way that Greece is going, they might well take the entire Euro-zone with them.
France isn't totally without some weaknesses of the same sort, and Germany, however economically powerful it is, cannot be relied upon to have the resources, or the will to expend them, needed to hold up the entire continent.
As for making imported goods more costly, it has been shown that much of the produce sold in Greece, once grown and marketed locally, is from Belgium or other Euro-zone countries, exactly because it is cheaper to produce them in great quantity there rather than in smaller volume and at greater cost in Greece. I'm not saying you're wrong, Per, but it is a fact that it's far too easy to oversimplify the way in which the integration of the Euro-zone has affected the various economies involved. The real problem, IMHO, lies in that the economic barriers between these economies have been taken down, but the cultural and political distinctions between them have not. The smaller economies are typically left-leaning ones, while the larger ones are not so much so.
All this leads to many more questions than answers. Asking them may lead to answers, but probably not very quickly.
|Greece Crisis||Satish S Munot||02/29/12 13:06|
|when||Erik Malund||02/29/12 14:42|
|do you mean||AP Charles||05/19/12 00:24|
|Well, ...||Andy Neil||02/29/12 15:33|
|Insufficiant effort||Satish S Munot||03/01/12 00:12|
|war?||Stefan KAnev||03/01/12 02:13|
|war wouldn't solve the problem||Richard Erlacher||03/01/12 06:58|
|War?||Per Westermark||03/01/12 07:22|
|Capital of Greece?||Murray R. Van Luyn||04/29/12 03:06|
|As always...||Kai Klaas||02/29/12 16:23|
|Devaluation of money||Per Westermark||02/29/12 17:01|
|That's exactly the solution ... however ...||Richard Erlacher||02/29/12 20:33|
|Social progress and change is often slow||Per Westermark||03/01/12 03:01|
|(SP)Stander & Poor Ratting||Satish S Munot||03/01/12 10:49|
|return to the Drachma will be cathastrofic||Stefan KAnev||03/01/12 11:38|
|??||Kai Klaas||03/01/12 13:30|
|You are right,Kai||Stefan KAnev||03/02/12 00:27|
|I don't agree||Oliver Sedlacek||03/02/12 04:39|
|austerity||Andy Peters||03/03/12 19:34|
|from what I've gleaned from the news ...||Richard Erlacher||03/04/12 08:20|
|New Testament||John D. Maniraj||03/06/12 08:25|