Greece must bow to austerity or go bust, says EU

[TooPragmatic]

45. But Greece does not have a currency

Firstly Switzerland is not in the EU. Secondly, Denmark even though it has the Krone, it is pegged to the Euro so it operates as if it had the Euro without actually having the Euro.

Then we have to look at these countries and how do they get by without the Euro. the UK and Switzerland both have large banking institutions and have a currency that is and has been well valued for a long time. Czech Republic and Denmark have strong export economies. All of the countries you have mentioned have relatively stable economies with low deficits and a public debt that is well constructed.

But one has to think of the consequence of Greece leaving the Euro and reintroducing the Drachma could be a hellish experience to Greeks who have already gone through though times.

What would it mean. First there would be capital controls and bank holidays so people wouldn't be able to get their money. then as restrictions would would come off the Drachma would dive and inflation would go way up. That would mean that people who have debts in foreign currencies would see their debts go way up and also all foreign goods would be a lot more expensive. A somewhat ok comparison would be Argentina, but Argentina has an economy that is more tied to the country and more self reliant economy. Early 2000's were rough for Argentina and it still hasn't gotten through the consequences. It would be a lot worse for Greece.