Wednesday, July 22, 2015

Grexit Is Only A Matter of Time

Greece, following Britain's lead during the early stages of the Great Depression, should abandon the Euro and devalue through introduction of a new drachma.

Britain, long before the lessons learned from Argentina, was the first country to reject austerity by abandoning the gold standard in 1931. Removal of the gold standard, an indirect form of default and devaluation, revived its economy and ended the vicious cycle of deflation that plagued the global economy. The Roosevelt Administration, following Britain's lead, abandoned the gold standard in 1934.

Headline: Grexit debate down but not out, Argentina lessons remain

Greece just narrowly avoided crashing out of the euro but for skeptics the clock is already ticking on when large-scale default and exit from the "irreversible" euro club are raised once again.

When it is - be that in two months or two years - the lessons from Argentina are sure to be revisited.



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