Steve Forbes wisely noted that since Greek politicians do not have a national currency, they can’t fix government finances by printing more of the currency and stealing value from currency holders. If Greek politicians still had access to the old drachma, they could have “hyperinflated” the currency (something we like to call monetary confiscation). Instead, members of the European Union are stealing value from all Euro currency holders by lending newly created Euros to Greece.
These countries fortunately did not choose to destroy the Euro (yet). Instead of only productive Greek citizens shouldering the burden of criminal Greek politicians and their supporters rioting in the streets, everyone who holds the Euro will fork over some wealth. This writer does not invest in the Euro.
In fact, the euro has spared Greece from an even greater disaster: poverty-inducing hyperinflation. If Athens were still using the drachma the government’s response to its fiscal difficulties would have been to turn on the printing presses, thus engulfing the nation in terrible inflation. This impoverishment would have been far more extensive and destructive than what the Greek people are currently experiencing. Just look at what hyperinflation did to Germany in the early 1920s.