What’s the Greek for Corralito?

by Paul Krugman

New York Times
March 28, 2013

It’s now three years since I suggested a possible route to Greek exit from the euro: a banking crisis, followed by sharp limits on bank withdrawals similar to Argentina’s 2001 corralito, and then — with the panic argument against exit removed — reintroduction of a domestic currency.

Obviously, that hasn’t happened. Despite intense suffering, the Greek political elite’s commitment to the euro has proved incredibly strong. My analysis of the economics wasn’t wrong, but my political guesstimates were off.

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