Re-take of the Greek crisis (update)

update; The second part of John Mauldin's observations after his visit to Greece

The first part is here:
The Greek Government Is A Prisoner Of The Bureaucracy

Read more: http://www.businessinsider.com/mauldin-prisoner-of-the-bureaucracy-2013-1#ixzz2JdRH8UWi

John Mauldin starts from the biginning.

Writing that Greece had only a choice between two disasters was not being dismissive on my part. It was simply recognizing the cumulative effects of the failure to make difficult choices. Once Greece lost access to the bond market, the game of borrow and spend was over.

let’s undertake a thought experiment and imagine what Greece would look like if they had exited the euro. The “good news” is that the new drachma would have immediately dropped by 50%, thus eliminating almost overnight the trade imbalance, as any imports would require a “hard” currency (euros, dollars, pounds) and that money would only come from exports. Greece would have been plunged into an immediate and steep depression. While government workers would get paid in drachma, banks would have gone bankrupt and been forced into nationalization. Businesses that needed to import materials to make goods, either for local use or to turn into exports, would have been cash-starved. It would have been chaos.