The Greece saga has been going on for years now. Is this the grand finale? It likely will be unless the German government and the European Central Bank and the rest of the establishment go along with another bailout.
I do not mean to make light of this in the sense that I know there are a lot of people suffering in Greece. As a collective, it is their own fault, but part of that is through ignorance. Part of it is also a mentality of handouts and trying to live off of other people’s labors.
I wish I had more direct knowledge of what is going on in Greece. Every person’s story is different, but we can be sure there are similarities. I know that some of the people are really in poverty.
There is a major contraction in the division of labor. I just read one story of a florist who is afraid for her business. She depends on foreign business (destination weddings), but many are cancelling their plans. Worse, she is not sure how she will get supplies from other countries for her store.
Many of the Greek banks have been shut down. The ATMs are limiting withdrawal amounts – and that is for the ones that aren’t already empty.
I don’t understand how some people there are so stuck. I have been writing about the vulnerability of Greek banks for quite a while. How could some people not see this coming? It is bad enough if you have actually stayed in Greece. It is just downright foolish to have left a sizeable amount of money in Greek banks at this point.
The Greek government has already defaulted with the IMF. It is now going to officially default, barring some last-minute bailout. The Greek people are supposed to have a referendum on July 5, one day after the American Independence Day.
If the Greeks vote to leave the European Union, that will be their independence day. Unfortunately, it won’t really be a good thing.
From a libertarian standpoint, the Greek government should default and leave the EU. Government-issued debt is not really a valid contract anyway because it is based on a promise of other people’s money who did not agree to it.
Unfortunately, a Greek departure won’t have many other libertarian aspects. Decentralization isn’t going to work if it means a continuation of the welfare mentality. It isn’t going to work with a new central bank that tries massive inflation to continue the welfare state. It isn’t going to work with everyone trying to live at everyone else’s expense.
I will provide a new update when something more final happens. That will either be an official Greek departure/ default or a longer-term bailout. A Greek departure could happen at any time, but maybe it will take until July 5.
With stocks on shaky ground and a Chinese economy that is on the verge of a bust, it will be interesting to see if this is a trigger for greater panic. It has already caused volatility in the markets.