Grexit, a bad or a good thing?

In the last months, since Syriza won elections at Greece (25/01/2015) and even before the elections if people didn’t vote whom banks wanted, the European boss Merkel is threatening Greek people with their expulsion from the euro. Even there is a new word for this terrible event, Grexit.


It’s known that Western “democracy” is a political system where everyone can freely vote, always that majority vote those the elite wish. If majority vote others, as Greek people did voting Syriza, then that people must be punished, even sometimes a coup d’etat must be done to restore the suitable limits to the “democracy”.

Well, let’s examine the German threat. Is it a threat? I mean, would it be bad for Greek people leaving the euro, or would it be good? Of course, mainstream media warn the apocalypse for Greece if Germany decide to expel them. (An aside before continuing: yes, I know, it’s supposed that European Union is an alliance between countries where a nation can’t impose their preferences over the rest and so Germany can’t ban a country; ok, but now let’s come back to the real world, Germany decide, period).

But the threat of a disaster fails because Greek people are living in a disaster since years ago. It doesn’t work, Angie.

Some economists have studied the matter (¿Se puede salir del euro? ¿qué pasaría después?). An economist, Andrew K. Rose published in 2006 Checking Out: Exits from Currency Unions. He compared 69 countries which after the Second World War left currency unions with other 60 countries remaining within them. This is the conclusion: Leavers tend to be larger, richer, and more democratic; they also tend to have higher inflation.”

Other economist, Jonathan Tepper, wrote this essay in 2012: A Primer on the Euro Breakup: Depart, Default and Devalue as the Optimal Solution. His conclusion is: The experience of emerging market countries shows that the pain of devaluation would be sharp but brief and rapid growth and recovery would follow.” And Mr Tepper is clear about what is the best for the European periphery (or PIGS, as Anglo-Saxon financial media name us with grace and delicacy: Portugal, Italy, Ireland, Greece, Spain): “Leaving the euro might well be one of the best things that happened to them.”

One of the best things. So, perhaps the Grexit would not be so terrible, would it be? Greece can be the first being ejected or withdrawing, but likely it would not be the last one. A country withdrawing will make the euro more unstable, and so it will be easier the next exit. Spain would follow Greek steps, especially if Podemos win elections this year, because this is other of those political parties which should not be voted in a Western “democracy” -banks don’t like Podemos, as they don’t like Syriza-. And the next might be Italy.

At this point more and more people think that the euro will not last long, what nobody knows yet is if it will be dismantled in a more or less orderly way or will burst in pieces. The second option is more probable though.

2 thoughts on “Grexit, a bad or a good thing?

  1. One senses that the Greeks are planning to “Grexit”, and only the required planning work will determine exactly when. When Greece returns to its sovereign money/drachma, international financial developments will become very dramatic and paradigm-shifting. In the positive sense.

    Liked by 1 person

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