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Sunday, February 12

12th Feb - Greek Exit Collection

Here is a collection of previous articles, views and analysis on what happens if Greece leaves the euro. Also a section on Euro break-up at the end of the post.

A Greek Deal? For now? (9-Feb 2012)MoreLiver’s
Maybe we will see a full default after they have received the next bailout tranche?

ECB, Bottoms Up! (8-Feb 2012)MoreLiver’s
On the ECB’s participation to the peripherial haircuts.

Greek lunch (7-Feb 2012)MoreLiver’s
Collection of recent articles on Greece (general, leaving euro and blocked accounts)

Why not to call default a default? (1-Feb 2012)MoreLiver’s
ECB wants to look like the savior, instead of being the one who is saved.

Assault on Default (25-Jan 2012)MoreLiver’s
Even though Greece has for all practical purposes defaulted, it will set a precedent – that no-one is safe. 

What happens if Greece defaults? (20-Sep 2011)MoreLiver’s
Links to articles in mainstream media.

Engineering an Orderly Greek Debt Restructuring (29-Jan 2012)SSRN
In this essay, we describe and compare three alternative approaches that would achieve an orderly restructuring but avoid an outright default: (1) “retrofitting” and using a collective action clause (
CAC) that would allow the vast majority of outstanding Greek government bonds to be restructured with the consent of a supermajority of creditors; (2) combining the use of a CAC with an exit exchange, in which consenting bondholders would receive a new English-law bond with standard creditor protections and lower face value; (3) an exit exchange in which a CAC would only be used if participation falls below a specified threshold. All three exchanges are involuntary in the sense that creditors that dissent or hold out are not repaid in full. (hat tip marginal revolution)

Greek agreement with Troika (9-Feb 2012) scribd
51-page document

Here's How Greece Would Leave The Euro (10-Feb 2012) BI

Here's Who Gets Clobbered If Greece Defaults (6-Feb 2012)BI

Is A Greek Uncontrollable Default Inevitable? (9-Feb 2012) ZH
Credit Suisse: the environment we currently observe, namely a low stress environment, is exactly the type where one would expect “aggressive” behaviour by any player. Therefore, we would not be surprised if a hard default by
Greece (i.e., a default where relations with the core break down, endangering the ECB’s considerable additional exposure) is being contemplated a lot more than it was just a few months ago.

'Without a New Beginning, Athens Is Lost' (10-Feb 2012)Der Spiegel
The European Union is demanding even greater sacrifices from Greece, despite the deal reached by politicians in Athens on Thursday. Facing more painful cuts, Greek citizens are back on the streets as resentment boils over. German commentators say it's time to finally face the truth.

'It's in Greece's Interest to Reintroduce the Drachma' (7-Nov 2011)Der Spiegel
Economist Hans-Werner Sinn is the president of the Institute for Economic Research (ifo), a leading German think tank in Munich. He spoke to SPIEGEL about the euro crisis, the growing uselessness of a bailout and a possible way back to the drachma for Greece.

Euro break-up – the consequences (6-Sep 2011)UBS (pdf)
Cost to a periphery country leaving 40-50% of GDP in first year.

Nomura Presents The Fair-Value Of European Currencies In A Euro Breakup Scenario (5-Dec 2011)ZH
Our estimates suggest significant depreciation risk for a number of eurozone countries in a redenomination scenario. We estimate that this risk is in the region 60% for Greece, around 50% for Portugal, and 25-35% for a group of countries including Ireland, Italy, Belgium and Spain. At the same time, our estimates confirm the common perception that a new German currency will fare better.

BCG Presents The One Chart To Explain The Implications Of Leaving The Euro (19-Dec 2011)ZH

Nomura: Endgame (25-Nov 2011)scribd
Absent a policy response, a euro break-up looks probable not possible

An orderly EMU break-up, à la Française (7-Feb 2012)The Telegraph
Euro break-up plan drafted by French economists: "The obstinate determination of governments to take us by forced march deeper into the euro impasse can only lead to the general aggravation of the economic situation in Europe."… "National currencies should be recreated in each eurozone country".

ING:  EMU Break-up: Pay now, pay later (1-Dec 2011)scribd
40 pages, with scenario analysis of both only Greece exiting or a larger break-up

Nomura: Currency risk in a Eurozone break-up- Legal Aspects (18-Nov 2011)scribd
15 pages, redenomination risk and the differences between local and foreign law applicability

What Happens & A Primer For Next Steps For The Euro Area (16-Sep 2011)ZH
Analysis from Citigroup and Goldman Sachs

The Future of the Eurozone and U.S. Interests (16-Sep 2011)scribd
32 pages. Congressional Research Service’s report, prepared for members and committees of congress. Prepared for Members and Committees of Congress

State of the union: Can the euro zone survive its debt crisis? (Mar 2011)scribd
46 pages from Economist Intelligence Unit

The Tipping Point? Time to call the ECB (Nov 2011)scribd
Deutsche Bank’s 51-slide presentation

A Primer on the Euro Breakup Variant Perception / scribd
53-page paper, h/t The Big Picture