7 Nov 2011

The Economist: Should Greece leave the euro zone and return to the drachma?

Question: Should Greece leave the euro zone and return to the drachma?

My Answer: Yes. (as of Nov 11 0:30 am, 49% YES v.s. 51% NO)

Whether Greece leave the euro zone or not, it's likely that Greece would end up defaulting its debt due to the poor management of its government. And if Greece is kept in the euro zone, this kind of turmoil could happen again due to the same currency over totally different economic areas.

Instead, leaving the euro zone would give Greece the devalued drachma after all, which could make its tourism industry, which I assume as one of the few competitive industries there, attractive to foreign visitors; at least its default could never affect the euro more than this time. Thus I believe Greece should leave it.

Another way to see it from FT, but I think his scenario seems less likely and backed up by no actual figures.
Greek default within the euro is the only real option

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