Suppose the Greek Government decides to stop payments-they default and declare national bankruptcy.
Now, they have no more euros-so they decide to re-instate the drachma.
Since there is no basis (yet) to determine a realistic exchange rate, the new drachma is just about worthless-the Greek treasury runs the printinting presses around the clock.
Would the result be something like the German hyperinflation of the late 1920’s?
I can forsee foreign investors coming in and buying up assets dirt cheap-real estate would be snapped up for pemnies.
Vacations in Greece would become a bargain-tourists could stay in the contry for next to nothing.
Wold this influx save Greece?
I think that may be the only thing that could save Greece in fact, it may fail too, but the current course of budget cuts leading to economic contration leading to more budget cuts that lead to more economic contraction, etc. will eventually bankrupt the country completely, leaving no other choice.