‘Grexit’ is a very high-risk strategy

No one knows how Greek leaving the euro would play out, says Matthew Lynn. That's why it won't be quick in coming.

Financial commentators have been queuing up to tell us that an early Greek exit from the euro is as certain as Manchester City spending a lot of money in the transfer market this summer. Citibank puts the chances as high as 75%. Bookmaker William Hill has stopped offering odds. The markets view it as practically a done deal and possibly before the summer is out.

In reality, a Greek exit or Grexit', as it has been dubbed is a lot further away than most people imagine. You need to remember just how small the Greek economy is. It can be bailed out again and again without it putting much of a dent in anyone's wallet. The eurozone leaders will chicken out. It is easier to reflate the Greek economy than face the completely unknowable risks of a disorderly break-up of the single currency.

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Matthew Lynn

Matthew Lynn is a columnist for Bloomberg, and writes weekly commentary syndicated in papers such as the Daily Telegraph, Die Welt, the Sydney Morning Herald, the South China Morning Post and the Miami Herald. He is also an associate editor of Spectator Business, and a regular contributor to The Spectator. Before that, he worked for the business section of the Sunday Times for ten years. 

He has written books on finance and financial topics, including Bust: Greece, The Euro and The Sovereign Debt Crisis and The Long Depression: The Slump of 2008 to 2031. Matthew is also the author of the Death Force series of military thrillers and the founder of Lume Books, an independent publisher.