Well I’d say that you’d wouldn’t let them default on their entire debt load – maybe 40% – do it slowly in stages and do your best to service each tranche. The remaining 60% you could refinance, bailout shorter term notes and index long term ones to some Greek economic indicator into the future. Argentina in the early 2000’s is the perfect case, they basically went through economic hell for three years, but have been steadily recovering after since 2003 and now are a very strong economy. They took the bullet head on and went through a bitterly painful three year recession but came out the other side okay. Personally I think that’s much smarter than a slow death Greece is in for even if this bailout package goes through, but again the Euro makes things more complicated because Greece can’t devalue their currency like the Argentinians.
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