By Jamie Douglas
Thanks to all of you who have responded to our call for questions about Expat living. Keep the questions coming!
With the financial world in turmoil, I am getting an increasing number of inquiries regarding the potential impact on expats in various parts of the world, but in particular Greece. The Hellenic nation has long suffered from its corrupt and inept politicians, and since joining the Euro Zone, things went from bad to worse. The leaders of the nation had to relearn the fine art of disingenuousness all over. Now they not only have to lie and deceive their fellow countrymen, but all of Europe’s bankers and the European Central Bank (ECB). These ECB’s financial wizards were unlike the populace of Greece, in that they were not accustomed to getting lied to by their politicians. It did not take very long for them to smell a big rat, discovering that the Greeks had manipulated and falsified all relevant data.
Say hello to downfall of Greece within the Euro Zone. Goodbye Euro, welcome back Drachma. The pending collapse of the Greek economy brought about massive fears in the rest of the EU that a sovereign default within the unified currency zone would bring about the end of the common currency, with a domino effect on the rest of the nations. Enter the other PIIGS, (Portugal, Italy, Ireland, Greece, and Spain) and you have Germany overextending itself to save the common currency from impending disaster. Every day on Bloomberg and the Wall Street Journal there are new fear mongering headlines: “Italy, the next Greece?,” “Spain, the next Ireland?,” etc. etc. In reality it should read, “Europe, the next USA!” But I forget, the script is that the USA is in the midst of the recovery. There are only 46.3 million people, one in six, now living below the poverty line. Unemployment is a mere 9.3% while the long-term unemployed and under employed rate hovers around 25%. That is right, ladies and gentlemen. One in four US citizens and their families are living the American Nightmare.
So without any further ramblings from exile, here is this week’s question:
I own a small house on a Greek island. We are planning to expat there in the next year or so. How is the current Greek and euro zone financial situation going to affect us?
(Thanks for the great site and your intelligent honesty)
Thank you for your kind words! Since receiving your inquiry ten days ago, I have been busy polishing my economic crystal ball, and it seems to me that you have nothing to worry about, provided that you have enough liquidity to sustain you. Common sense dictates that prices can only go up so much before the Greek populace will start rioting again in the big cities, torching banks and government offices to protest rising prices and inflation, as well as the austerity measures the (wo)man in the street will end up paying for as a result of the entrenched government corruption. Being on one of the islands, you will benefit from the dissent in Athens and other cities, while being relatively isolated physically from the disturbances.
I would however highly recommend to you, that you build yourself a good bug and rodent proof pantry in your home, and stock it with a maximum amount of staple foods and favorite items, in case of an interruption in the supply chain to your island. Having lived a very large portion of my life on isolated islands, may I suggest stocking up on essential paper goods, you know the ones? Laundry supplies and personal hygiene items should also be included in that list.
But overall, I don’t see any reason why you should postpone your hard-earned migration to your place in the sun. Enjoy the Ouzo for me as well.
Jamie Douglas
San Rafael, Mendoza
Where fortunately, that Fine Malbec Wine does not taste at all like that evil Ouzo!
(image: Mykonos, via Wikipedia)
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