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[–] Guerilla 0 points 2 points (+2|-0) ago  (edited ago)

I'm not sure either, it's just the only logical assumption I can make. I'm not an economist and I knew it was a horrible idea from the very beginning so either the people governing us have the IQ of a gorilla or they had other plans. The logic is simple btw I can explain this to you in a few lines. Countries who have control over their currency can devalue it in moments of economic crisis by printing money. This process is great for the economy in two ways, a) you print money which you tunnel in the local economy boosting the overall economy of the country and b) since the currency is now weaker exports increase further boosting the economy. All this is impossible under Euro, countries don't have control of their own economy and Euro itself is a ridiculously inflexible currency that has been compared to gold by many economists. So what happens during a crisis to not so stable economies? Chaos. This is the main reason why this was a disastrous idea, there are smaller ones too though.

So how the fuck could they not predict this? A 15 year old can reach the same conclusions if I describe this to him.

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[–] Rea11yN0tMe [S] ago 

If there was no downside to devaluing your currency, everybody would do it. But as I am not an economist either, I don't know what they are.
But I agree that it would be beneficial for Greece to devalue because of the crisis, but you can't because you share the currency with Germany. So the Drachma it is.

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[–] Guerilla 0 points 1 point (+1|-0) ago  (edited ago)

Devaluation being done all the time would lead to hyperinflation. It's only reserved for times of crisis when deflation also occurs (not always) to to fix the problem. It's a tool to fix a crumbling economy, not to grow it. Not to mention that devaluation also means, well, less value practically resulting in lower wages (in no way though a 20% devaluation means 20% less real wages, it's much much lower because of a number of reasons)