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It's 'Goodbye Greece' As Athens Abdicates And Exits Eurozone

Greece To Leave Eurozone !

1st November The Greek Goverment decision to hold a referendum on the new austerity measures is according to euromost sources in Athens a calculated move by the Greek Primeminster to give Greece time to prepare for it;s exit from the eurozone in 2012.. The Gernan and French governments are understood to be aware of these plans and are preparing to introduce legislation with in the European Union's Eurozione faciltate an 'orderly' Greek exit.

It is understood that The Greek Primeminster George Papandreou believes the new measures are not tenable as over 50% of the population are opposed to the measures and any attempt to implement them will rapidly escalate the civil unrest within Greece possibly leading to a complete breakdown in law and order. If that happens Papandreou and his Panhellenic Socialist Movement would require the support of the Greek military.

Mr Papandreou is aware that there is some doubt as to whether this support would be forthcoming as an American CIA report in May this year suggested that some key players in tthe Greek Miltiary, many of whom are known to be euro-sceptics, were prepared to stage a military coup if the general situation in the country detoriated and their own pensions were not reinstated to the levels before the austerity measures where introduced.

The possibility of a Greek socialist Primeminster being ousted by his country's armed forces is difficult to quantify but it should be remembered that the country was ruled by a right-wing military junta between 1967 and 1974. Angela Merkel the Gernan Chancellor and French President Nicolas Sarkozy are reportedly aware of the CIA report and prepared as a last resort. to aid Greece's departure fromthe eurozone or the EU as a whole if it avoided a coup. Thus would maintain the 'status quo' and ensure Greece's continued membership of NATO.

The plans for a referendum, which would reject the conditions attached to the latest bailout . would give both Athens and Brussels time to ;finalise' legislation and plans for Greece's departure and miinimise the risk of a coup.. . Some of the money raised to finance the Greek bailout and other imminent bail-outs would be redirected to support European bank adversely affected by the Greek exit. . The Greek Government is understood to be preparing to nationalise the county;s own banks which would be unable to function pinternationally post the exit. Some support for this measure may come from the EU.

If this senario is realised the Greek Goverment will reinstate the former drachma as it's currency at an exchange rate of at least 45% lower than when Greece joined the eurozone. The Bank of Greece believes that though exiting the eurozone will create problems in the short term but living standard will fall no further than they would if the country remained within the zone and the austerity measures where implemented. In the long term they believe the devalued drachma would benefit the countries leading manfacturing industries and in particular make Tourrism to Greece (which accounts for 16% of GDP) the most attractive destination country in Europe.

Editorial Comment With the benefit of hindsight one could ask whether the supposed resolution of the eurozone crisis was merely an attempt to pacify the financial markets whilst the appropiate Greek exit was being engineered. It is difficult to believe that the most influential economies in the EU are surprised about the announcement of the referendum. if they were aware of the disquiet in the Greek military. That said Greece should be thrown out of Eurozone and the EU as it cooked its books to gain entry anyway.