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Strong Eagle
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Post by Strong Eagle » Wed, 08 Feb 2012 10:41 pm

aster wrote:That's the thing, they wouldn't be able to convert the debts to Drachmas whilst maintaining a fake conversion rate that would plummet about 50% as soon as it was released and made susceptible to market forces.
What is going to stop them if they choose this course?

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Post by aster » Thu, 09 Feb 2012 9:38 am

Their debt is in Euro and they won't be able to convert it to another currency simply because they choose to. Fair enough using free market rates/conditions, but I don't think it's feasible if they peg the currency just for this aim and then let it plummet 50% the following month.

Having said this the write-off on their debt would probably exceed 85% by that stage, so creditors will be glad to get anything out of them... even soon-to-be-devalued Drachmas...

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Post by JR8 » Sat, 18 Feb 2012 10:38 pm

aster wrote: As for Iceland it's a good example of how the lack of a common currency can hurt you as its sends the local currency's value down the drain and obliterates peoples' savings.
Enjoy :devil:

Iceland's Viking Victory
'Congratulations to Iceland.

Fitch has upgraded the country to investment grade BBB – with stable outlook, expecting government debt to peak at 100pc of GDP.

The OECD's latest forecast said growth will be 2.4pc this year, after 2.9pc in 2011.

Unemployment will fall from 7pc last year to 6.1pc this year and then 5.3pc in 2013.

The current account deficit was 11.2pc in 2010. It will shrink to 3.4pc this year, and will be almost disappear next year.

The strategy of devaluation behind capital controls has rescued the economy. (Yes, I know there is a dispute about exchange controls, but that is a detail.) The country has held its Nordic welfare together and preserved social cohesion. It is slowly prospering again, though private debt weighs heavy.

Nobody is forcing the elected government out of office or appointing technocrats as prime minister. The Althingi sits untrammeled in its island glory, the oldest parliament in the world (930 AD).

The outcome is a vindication of sovereign currencies and national central banks able to respond to shocks.

The contrast with the unemployment catastrophe and debt-deflation spirals across Europe's arc of depression is by now crystal clear.
Those EMU shroud-wavers who persist in arguing that exit from the Europe [euro?] would be suicidal will have to start coming up with a better argument.

Is it now so clear the Iceland will join the EU and the euro? Don't bet on it.'

[continues] ... g-victory/

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Post by aster » Sun, 19 Feb 2012 12:51 am

Best thing they did was refuse to pay up for their defaulting banks (yes, those thieving idiots again :D ). How much did morons from other countries who held their funds there lose?

Icelanders would gladly ditch their crap currency and are now looking into taking on the Canadian Dollar without actually being part of the currency in any other way (no decision making, etc.).

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