Of all the arguments ranged to deter countries from leaving the Euro, the primary one is that all the sovereign debt of these countries is denominated in Euros, and as they quit the currency their renewed national currencies would be perceived as weak. The result would be that their sovereign debt would balloon in value. This however might not be the case.
Posted on The Tap Blog
Friday, 23 January 2009
Quitting The Euro Can Reduce Sovereign Debt