17.15: Bloomberg reports that Greek PM Lucas Papademos has requested the country’s finance ministry to prepare a document on the implications of a Greek default. Mr Papademos asked the ministry [to] record accurately and realistically all the consequences of the country’s exit from the Eurozone acccording to Panos Beglitis, spokesman for the socialist Pasok Party, who told Radio 9 [that] iIt’s an important initiative because the Greek people should know exactly what consequences a bankruptcy and eurozone exit would have and thereby take their responsibility.
It’s unthinkable that Greek officialdom has not been thinking about this for months now, so a very public announcement of this type can only be seen as theater, with I imagine, two audiences. If I had to guess, Papademos is reminding Greek voters of where a refusal to accept more austerity could lead (a large majority of Greeks want to hang on to their euros), but he’s also signaling to Germany that its demands risk pushing Greece out of the euro zone — and Europe into unknown territory.
That said, theater or not, I wonder how many (more) depositors in Greek banks will be rushing for the exit without waiting to see how it will end.