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by mseebach 4000 days ago
> It takes at least a year to create a new currency

A new full blown currency, yes. A new temporary currency can be done in days, or weeks at most - East Germany did it. Slovakia did it. The process involves your current currency and a stamp.

For businesses and institutions, it's much easier, everything is electronic anyway. Your bank accounts just switch over from EUR to XGD.

> it won't be worth anything

That's pretty much the point. Exports and tourism will be boosted and the debt will be re-denominated in the new currency (at a fraction of its EUR value) or outright defaulted on.
1 comments
gizmo 4000 days ago
A new currency would be worth much less than the Euro. That's a good thing. But it would still need to be more or less stable. I'm skeptical that an emergency currency would hold its value, because of capital flight.

My "at least a year" claim is based on this:

http://www.theguardian.com/commentisfree/2015/jul/10/germany...

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mseebach 4000 days ago
Yes, the currency would take a while to stabilise, but it's not like Greece is a model of stability as it is. The argument for, is that the stabilisation following a massive devaluation, will happen sooner than whatever the endgame to the current circus is, will.

> My "at least a year" claim is based on this:

Now, why would a politician exaggerate how painful a solution he doesn't like is? Does he really think that post-grexit Greece and Iraq in 2003 are completely comparable in terms of security and infrastructure? Does he know that Iraq's economy was almost entirely cash-based whereas Greece's is based on a fairly modern banking system?

I base my claim on actual history that actually happened: http://uk.reuters.com/article/2011/12/08/uk-eurozone-lessons...

If I put on my conspiracy cap, I wouldn't be surprised if a helpful soul decided to discreetly have a transition-currency printed up, ready-packed on pallets in a basement somewhere in Frankfurt.

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gizmo 4000 days ago
I agree that a massive devaluation followed by a stable-ish currency is preferable to the current circus.

I also agree that your skepticism is justified. However, you're mistaken that Varoufakis wrote that because he doesn't want an exit. In fact he's been arguing that Greece should have started preparations for a new currency years ago. Varoufakis even got fired because Tsipras wasn't willing to gamble with a possible grexit. Of course it's possible that Syriza did make preparations for the new Drachma and all claims to the contrary are just misdirection. I don't believe that, though.

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bboreham 4000 days ago
The capital that can fly, has flown.
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