Sunday, May 27, 2012

Lawyers to Multinationals: Get Your Money Out of Greece

One day soon, those who have money in Greek banks accounts may wake up and find that they have devalued drachmas in their accounts instead of euros. The advice lawyers are giving multinationals is to get their money out of Greece now. NYT reports:
Under European Union law, Greece cannot leave the euro. That is the theory. But in practice, any protection the law offers investors could be difficult to enforce, according to lawyers trying to protect their corporate clients against the upheaval sure to follow if Greece were to default on its debts and adopt a new currency.

So their advice is blunt: Remove cash and other liquid assets from Greece and prepare to take a short-term hit on any other investments.

“My personal view is that it is irrational for anyone, whether a corporation or an individual, to be leaving money in Greek financial institutions, so long as there is a credible prospect of a euro zone exit,” said Ian M. Clark, a partner in London for White & Case, a global law firm {where Rudy Giuliani once worked]that has a team of 10 lawyers focusing on the issue.
Vodafone, the mobile phone operator, and GlaxoSmithKline, the pharmaceuticals company, say they are “sweeping” money out of Greece and into British banks each evening, reports NYT.

This panic money flowing out of Greece is not likely to stop. Thus, Greece is likely to act sooner than later to convert euros to drachma. But it will require a coordination with Greek police and military. If Greeks wake up one morning and find their accounts have drachma in them instead of euros, all hell could break loose on Greek streets.

2 comments:

  1. This will be quite instructional for us but more so for the police and military because they get to test new crowd control techniques, riot gear, and weapons. Lessons learned will be invaluable for continuous improvements and profits for security companies.

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  2. They also get to see what percentage of police and military stay with the gov't and what percentage give up and join the people.

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