The Greek financial nightmare is a reminder of why countries benefit from having their own currencies. In the old days, a flexible drachma could have been devalued to boost exports and economic growth. But today’s euro trades at a single exchange rate that may suit some of its member nations but not others. For Greece, it has become the equivalent of a straitjacket.
So why doesn’t Greece drop the euro and restore its freedom of maneuver? A cheap drachma would boost exports and tourism — and it might be the easiest means of post-crisis financial adjustment.
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