Golden moment for Greeks

Finally, thanks to the left leaning Govt of Greece, the voters of Greece got an opportunity to wean away from the burden of Euro. The referendum on 5^th July 2015 is anxiously awaited by the financial world, especially those in Europe. The hyper volatility of European stock markets in these days evidences and captures the mood.

 

Financial thoughts have opined as far as three years back why Greece should get out of Euro, which is created to favour the dominant nations of Euro zone.

The basic reason for the instability is the lack of cohesion i.e. the attempt to have common monetary policy without uniform fiscal policies. Well, since Financial thoughts have mentioned about the same in another blog, we will not dwell much on it now. (Interested readers may please visit   http://www.financialstrategyonline.com/2012/02/lamentations-of-greece.html)

 

The real beneficiaries of Euro mainly includes Germany – who although lost two world wars has won the economic war in Europe just as Japan did it in Asia. The Euro is good for the large business houses of the Europe as it eliminated the foreign exchange risk and brought in more predictability to the turnover and profits.

 

Also for some, it gave a pleasure of a Europe Empire united under one currency, which is something Napoleon Bonaparte planned in early 1800s. However, let the practical considerations prevail rather than the romantic ideas of a United Europe – a Europe united under one currency.

 

Now the common man in Greece, Portugal and Italy is suffering under the burden of the colonial Euro.  Under normal circumstances, Greece would have devalued its currency and attracted more exports (more foreign currency) or tourism mainly from the same Euro zone countries that would flock to Greece to enjoy sun and historical moments. Rest of the world would also flow into Greece. Now the rest of Europe has no added incentive of a devalued currency to plan a trip to Greece. A trip to Greece almost costs the same as a trip to France! This would not have been the case, if Greece have its own currency.

 

Hence, let the Greeks snatch the opportunity to obtain freedom from the yoke and tyranny of EURO.  Any such decision would lead to some financial turmoil; however it is worth it. Of course, many people in the rest of Europe may wish that Greece continue in Euro; however a wise decision may not be satisfying others wish; at the expense of yours.

Disclaimer: Our opinions are based on economic and other conditions now and such conditions may change significantly over relatively short period of time. Should circumstances change significantly after the issue of this report, the conclusions and opinions expressed herein may require revision. The statements and opinions expressed in this report are for academic purposes only and to provoke the thoughts of the reader.