This blog is usually about emerging markets, so why I would be writing about Greece? Well, it seems Greece is now a submerging market, hopefully an emerging one in the future.

I make no claims to solve this situation, and this is a somewhat personal post. One thing we usually forget about economic crises is the impact on the lives of regular people. Among the thousands of news articles on the Greek crisis there are precious few about the consequences and expectations of the crisis on the day-to-day lives of regular folks. What follows is part of an exchange between a Greek friend and I on the crisis. I am posting his edited emails to the situation before and after the referendum. X*** is his wife.

As you can see, he is a little bit optimistic in his more recent email after a bleak assessment in the one before the referendum. I have lived through many crisis in Latin America and I know getting out of the euro will mean a horrible time for Greek people – bank holidays, losses from forced conversion to a new currency, overshooting in the new exchange rate, an even steeper drop in GDP and standards of living, uncertainty, and a potential (although unlikely) devastating financial crisis. I don’t want it to happen. Neither does he. There is more than enough blame for the current situation, from the stupid Greek government to German intransigence. Here is his email from just a few days before the referendum took place.

“I am in the middle of a neo-crypto-marxist lunacy that will tarnish the reputation of my country for the foreseeable future. I feel an abysmal sadness bordering to desperation. My money was out of the bank even before you told me so, so I’m ok in that respect. X*** didn’t do it and now she regrets it (serves her right for not listening to me). But apart from it, all, and I mean ALL is in the air. I won’t probably get paid next time due. X*** is in the middle of her retirement process, so she won’t be paid for sure. We are waiting for queues to appear in supermarkets soon if sanity doesn’t prevail. And they still pretend that they are successful the Leninist sods, and divide my people trying to convince them that we now have an outside enemy after all, Europe!!! I just pray that after that fu***ng referendum we don’t split apart as a society, but I’m afraid that that’s their ultimate goal as proper f***ng revolutionaries, making my country a European Venezuela, without the oil of course. The only hope is that Europe realises that it has a political problem in its hands that can explode, not an economical one, needing political handling and solution. We are NOT Portugal or Spain as her Sauble seems to think: we are a corrupted potential Ukraine, or Egypt, or (God forbid), Libya, one look at our history of bloody divisions history is enough to understand… God help us all.
PS You asked for some news. Sorry I can’t be more upbeat, and thank you for taking the time to ask my friend, it means a lot not to feel alone.
PPS Oh, goodbye Amazon for now, no money can get out of-fu***ng-course…Welcome to the Mediterranean third world…”

After the referendum the outlook is a bit better.

“The good thing is that we are not divided after the referendum, because it turns out that we all (regardless what we voted for) think and want the same thing after all. The people that voted NO, voted NO to austerity as a sole answer to our economic problems, not NO to Europe! The people voting for YES, voted YES to Europe (as they felt the Tsipras government had this agenda deep down in mind) but they too still would have said NO to austerity. Talking to people from the both sides confirms it, everybody feels the same way, only they perceived (and answered the perceived) question according to their own priorities.

In other words, if the question was YES or NO to more austerity, the referendum answer would have been a 90% NO; if the question was YES or NO to Europe the answer would have been a 90% YES. You see? People here say NO to austerity, especially if it is only for the poorer (which was overwhelmingly the case up until now), YES to Europe, YES to Euro (because no one trusts ANY Greek government to orchestrate a painless and successful transition to drachma for starters, and they FEEL in their guts that the drachma under the present socio-political establishment means eternal inflation and the permanent Balkanization of our country), NO to Her Shauble (principally) and Germany secondarily, which they perceive as taking care its own selfish national interests first and foremost (if not only) and to hell with the rest of Europe (all in the name of Europe of course). It’s a deja vu feeling as people here still remember the German ruthlessness all too well…

Now, after this referendum is over, there are some positive signs I am happy to report, as the government rallied up AT LAST the rest of the political parties under the President for support (which should had been done right after the elections) and they departed with a new negotiating team, without radical elements in it that could have used as an excuse for the Germans to boycott the talks (they even sacrificed Varoufakis as another Ifigeneia, replacing him with a rather moderate guy that was born in Amsterdam, was educated in Eton, is married to a Scottish economist and speaks pure Queen’s English). Now, if France could only find the guts to resist Shauble and if they can put in good use the IMF’s own report that Greek debt NEEDS restructuring (not a lonely, loony Greek demand anymore, thank God!), if -in other words- we accomplish to de-escalate it from the ideological dispute it came down to be, then there’s hope. The (very harsh) agreement was very close in any case, it was just that Tsipras couldn’t pass it through its own party and faced losing parliamentary majority (hence the REAL reason for the referendum!). In any case, and for the first time we seem to go out there united and not sounding as incoherent radicals. Its time for Germany (let’s not kid ourselves, they are the key to it all ) to stop being so protestant punitive.”

And I would add, for Greece to accept many sensible conditions, especially the ones that do not affect the middle class.