Those who are driving inflation by reason of profligacy will see their prices rise while euro prices remain stable. Moreover, their ability to make on-line imports paid for in euros will diminish as their stock of euros becomes exhausted – and on-line retailers will not accept the eDrachma.
Currency speculators would be rebuffed: security measures that tie the ownership of bitcoin to Greek corporate or individual domicile would mean that measures to circumvent the bans would be both expensive and time consuming, both of which would be a disincentive to try to play with the eDrachma.
There would be no need for Greece to exit the euro.
The ECB and IMF would see moneys repaid, not defaulted upon, and by negotiating regular repayments instead of lump sums, the amount can be rapidly diminished, starting immediately, with the benefits that should have on interest calculated on reducing capital outstanding.
There are no downsides to this suggestion. Everybody gets what they want.
Stock markets would stabilise. Already, after the initial shock of default and the “no” result of the referendum, the knee jerk reaction of markets is wearing off as analysts are realising just how tiny Greece’s trade with non-EU markets really is – and that of that trade, much of many countries’ exposure is in relation to shipping not goods or other services. Take away the uncertainties of what would happen if the EU started to fracture, and markets will – as always – respond positively to good news.
But here’s the best thing: all the Greeks need to do is call in the Geeks and find a way to pay them to produce the required product and tell them how to roll it out.
Hint: they are at bitcoin.org.
An edited version of this article first appeared at https://www.tradingfloor.com/posts/greeks-need-geeks-for-a-brave-new-edrachma-5505852
This article was digested at Eastnets Daily (http://paper.li/EastNets/1322720139?edition_id=b988b930-26cb-11e5-b91d-0)
© 2015 Nigel Morris-Cotterill
All rights reserved.
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