The recent dramatic events surrounding the Greek debt crisis had many of us on the edge of our seats as we witnessed history unfolding before our eyes. From the calling of the referendum, to the landslide No vote, to Tsipras’ subsequent capitulation under pressure from the Troika-- for many of us it was as gripping as it was occasionally demoralising (like watching the finals except the outcome actually matters). What I’m sure is lost on most, obscure as the mechanics of the monetary system are, is the crucial role of fractional reserve banking both in precipitating the crisis and in using it to strip the Greek people of their democratic sovereignty.
I wanted to write something after being lucky enough to spend time in Greece over the last 10 days.
A Grexit might never happen, but it could also be just days away. If a Grexit does happen, is it all doom and gloom, or is there a glimmer of hope? The re-establishment of the World’s oldest currency could represent a new path for monetary reform. One which is fit for purpose and designed to meet the challenges of the 21st century.
Greece must avoid replacing one myth with another - that returning to the drachma will be a panacea. If and when the drachma returns it will not be the notes and coins issued by the State free of debt which will be the problem, it will be the new drachma denominated debt issued by the privately controlled international banking system which will hobble Greece to its present masters, reads this BellaCaledonia article that is well worth reading.