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Wednesday, December 17, 2014

A Brit's Prediction for Greece

Below is another message from my friend, the 70+ year old Brit who has been living in Greece for ages. He is the one who had predicted a Grexit for January 11, 2013 at 22 hrs. He was wrong then. And now?

"I still maintain that we will eventually get to the Drachma. The Eurozone bosses just have to figure a way to isolate Greece and let it go its own way without bringing down the rest of the edifice at the same time. Of course, how the Euro is expected to work when it only relies on monetary policy - when the missing fiscal ingredient isn't also there - beats me! Only a Federal Europe can make it work and it isn't going to happen. As Tony Barber recently said in the FT, modernisation, not debt, remains the big challenge for Greece [very interesting article - FT, December 13th]. And we know that Greece is incapable of real reform! So, whether Samaras wins or loses the Presidential vote, whether Tsipras wins or loses a General Election --- it'll end in the same result, i.e. default and the Drachma. It's just a matter of time. As I have been saying for a long time, the sooner some form of planning takes place domestically to prepare for the Drachma - two years of professionalizing Agriculture & Tourism - the less the chaos will be. There is no mistaking that, even with professional planning in each of these two areas, there will be some form of chaos but hopefully somewhat mitigated. However, I just don't see any planning remotely possible. Politics here is going to be a version of the rugby hospital pass: Karamanlis did it to Papendreou in 2009, Samaras may do it to Tsipras, and Tsipras would soon be looking for another victim to pass the ball too! How can any true reform take place under these conditions?!"

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