A new government may have to respond with capital controls to prevent citizens, faced with potential devaluation of their savings, from withdrawing their money from banks, said Dawn Holland, a senior research fellow at the National Institute of Economic and Social Research in London.
“This has to happen very quickly, as capital flight has already happened,” she said. “This is when things could get ugly too, as on an individual basis you cannot blame people for wanting to hold on to their euros.”
Back in the 1860′s, right after the War Of Southern Overconfidence, that Confederate money was worth….what? Nothing, right?
Back in the Weimar, around 1920-something, the Marks you got paid on Friday would buy only half of what they bough the previous week.
In Harare, your life savings of 1,000,000 dollars suddenly became 1 dollar at the stroke of pen. And it still wouldn’t buy you a dozen eggs.
If there really are bank runs going on in Greece, where do you think people are sinking their money to keep it’s value? I would guess that, like the Germans, it’s going into durable goods, food, medicine and those shiny little bits of metal.