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Adrahil
Adrahil's Journal
Adrahil's Journal
June 29, 2015
"OK, this is real: Greek banks closed, capital controls imposed. Grexit isnt a hard stretch from here the much feared mother of all bank runs has already happened, which means that the cost-benefit analysis starting from here is much more favorable to euro exit than it ever was before.
Clearly, though, some decisions now have to wait on the referendum.
I would vote no, for two reasons. First, much as the prospect of euro exit frightens everyone me included the troika is now effectively demanding that the policy regime of the past five years be continued indefinitely. Where is the hope in that? Maybe, just maybe, the willingness to leave will inspire a rethink, although probably not. But even so, devaluation couldnt create that much more chaos than already exists, and would pave the way for eventual recovery, just as it has in many other times and places. Greece is not that different."
His whole blog on the issue is worth reading. I have been skeptical of Greece leaving the euro as resulting in enything but disaster, but I think Krugman, as usual, makes some very good arguments.
Krugman opposes Greek "bailout"
http://krugman.blogs.nytimes.com/2015/06/28/grisis/?module=BlogPost-Title&version=Blog%20Main&contentCollection=Opinion&action=Click&pgtype=Blogs®ion=Body&_r=0"OK, this is real: Greek banks closed, capital controls imposed. Grexit isnt a hard stretch from here the much feared mother of all bank runs has already happened, which means that the cost-benefit analysis starting from here is much more favorable to euro exit than it ever was before.
Clearly, though, some decisions now have to wait on the referendum.
I would vote no, for two reasons. First, much as the prospect of euro exit frightens everyone me included the troika is now effectively demanding that the policy regime of the past five years be continued indefinitely. Where is the hope in that? Maybe, just maybe, the willingness to leave will inspire a rethink, although probably not. But even so, devaluation couldnt create that much more chaos than already exists, and would pave the way for eventual recovery, just as it has in many other times and places. Greece is not that different."
His whole blog on the issue is worth reading. I have been skeptical of Greece leaving the euro as resulting in enything but disaster, but I think Krugman, as usual, makes some very good arguments.
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Member since: Wed Aug 8, 2012, 03:00 PMNumber of posts: 13,340