According to this article, exiting the euro would be disastrous for Italy because it would lead automatically to debt default. This is probably true, but it seems like a pretty incomplete argument. Remaining in the euro is likely to prevent Italy from...
brookings.edu/blog/order-fro…
brookings.edu/blog/order-fro…
...growing out of its debt anyway, as has already been the case for a decade, which would mean the economy suffers from several more years of no growth until it eventually defaults anyway – either explicitly or implicitly.
By the way that's always what happens to countries...
By the way that's always what happens to countries...
...with excess external debt (both developing and developed): economists and "money doctors" will insist that with the "right" growth-enhancing reforms (which are always the same), they can eventually outgrow the debt, but I can’t think of any case in the past 200 years in...
...which the strategy actually worked. What is barely understood in economics (although well understood in corporate finance) is that the debt itself can prevent growth. What always ends up happening happens is that after many years of struggling unsuccessfully to implement...
...the proposed reforms, the country eventually implicitly or explicitly defaults anyway, and only after significant write-downs does it finally begin to grow again.
foreignaffairs.com/articles/south…
foreignaffairs.com/articles/south…
