Reply to time to let Greece exit the Euro zone?

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[quote=jsteele]It is in Greece's interest to remain in the Euro Zone, but only in the right circumstances. The Greeks can threaten to default in order to get the best terms possible until someone calls their bluff. At that point, the Greeks need to decide if they are bluffing or not. I don't think Germany, or to a lesser extent France, will allow Greece to default. Instead, they will concede to Greece's demands.

This situation again highlights the problem of "too big to fail" banks. If this was just an issue of allowing Greece to default, very few would care. But, if Greece goes down, it takes Germany's banks with it. Then, the Germans will have to bail out their banks in order to avoid much bigger problems.

If Greece does default and leave the Euro Zone, it will devalue the drachma and increase its exports. Once its back on its feet, the banks will be there with money bags. Bankers aren't not known for passing up a chance to make a buck (or a drachma). Nor, as we have seen much more than we would wish, are they known for avoiding risky loans.
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