Greece: IMF says in Grexit hyperinflation ahead – SPIEGEL ONLINE

The International Monetary Fund (IMF) in Washington adjusts to the Greek exit from the euro. In an internal non-paper IMF experts say the country for this case requires serious economic dislocation. So be expected to hyperinflation.

The IMF experts recommend the Greeks, release the exchange rate of its currency and by no means new to couple to the euro. Only in this way could the new currency depreciate in order to strengthen the competitiveness of the Greek economy. However, the low external value of the new money would drive up prices of imported goods up.

This development should the Greek central bank decided to confront. For this purpose, it aims to provide a specific inflation target it with drastic measures, such as interest rate rises, interspersed. The strict monetary policy had to be accompanied by a decided austerity. The only way to gain confidence with the new currency.

For the rest of the euro zone and the global economy the exit of Greece is estimated by the IMF against “manageable”. For “vulnerable countries” ?? meaning the former crisis countries Portugal, Ireland and Spain ?? would need special protection walls are built to protect them from attack by speculators. Money must be ready to buy up bonds of these countries to need or to fund their budgets. But for enough funds of the European rescue fund ESM and the new instruments of the ECB.

(This message comes from SPIEGEL. The new MIRROR, click here.)