FINANCIAL TIMES: ….About two years ago some large businesses and wealthy individuals began seriously to ask, “if the euros were to unwind, in which currency would my asset or contract be denominated?” The issue is not whether the euro coins in your pocket carry an Athenian owl or German imperial eagle. The issue is the status of bank deposits and loans, residential mortgages and commercial contracts, as well as wages and prices. The drain of funds from Greek banks is an indication that ordinary people are now thinking in these terms.
Europe’s hapless politicians, having asserted that exit from the single currency was impossible, must now claim that exit would be relatively easy. Only then can they plausibly threaten the Greek electorate with expulsion if they vote the wrong way. But exit was never impossible, never easy and even when it was publicly unthinkable central banks would have been negligent not to have put in place contingency plans.
That is why even though Greece is a small part of the eurozone, a Greek exit is an existential threat to it. Once a path to exithas been defined, business and individuals will have a template for understanding the consequences of further unwinding… (more)
EDITOR: According to Wikipedia :” Furthermore, [the European Central Bank (ECB)] has the exclusive right to authorise the issuance of euro banknotes. Member states can issue euro coins but the amount must be authorised by the ECB beforehand (upon the introduction of the euro, the ECB also had exclusive right to issue coins).
Please pardon the pun, but we must confess that the ramifications of leaving the eurozone remains ‘Greek’ to us. At least the above sheds some light.
