The great Greek showdown

In his weekly commentary, SMU adjunct faculty member Larry Haverkamp focused on Greece’s debt negotiations. He noted that Greece is in need of austerity and a reform, as it is the most indebted of the 19 countries using the Euro. He added that Greece has until the end of February to accept an extension of the current bailout agreement so it can continue receiving aid from Germany for another six months. If Greece fails to do so, Greek banks are likely to face a cash crisis from a run on the banks by depositors, and the country would have to impose capital controls. He also said that Greece should next switch from the Euro to its old currency, the Drachma, so as to repay its debts.