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WAS VAROUFAKIS SINCERE ABOUT CREATING A PARALLEL CURRENCY?|
Of course not.
He had sworn his fealty to the Tsipras and the Euro many times before, even though he said he is against austerity measures. We have to take him at his word, even though we do not really know what he means. If anything, the talk about his "secretly" trying to create a parallel currency to the Euro serves as a convenient open target for the pro-Euro forces to crush, and thereby set the policy of government for the squashing of any indigenous currency that could in any way supplant the Euro, even if only to alleviate the artificial scarcity of cash that the banks claim they cannot issue, to the depositors, whose RIGHT IT IS TO DEMAND EITHER EURO OR AN EQUIVALENT MEDIUM OF EXCHANGE.
Indeed, the demand for a cash currency is so high right now that any project to issue a parallel currency is bound to be a resounding success.
Without calling it currency, a bank ABC could issue IOU's to the public who are willing to write it checks with notarized affidavit denominated in Euros in exchange for an equal amount of IOU's with exchange rate that one unit of IOU equals one Euro. But if any Greek depositor were to write Bank ABC a check in Euros, then that depositor would get a bonus equal to 5% of the IOU units he would have received, in addition to such IOU units. Conversely, if anyone wishes to convert his IOU units back to Euros, there will be a commission equal to 5% of the IOU's presented for exchange, subtracted from the Euros he would have otherwise received.
Overnight, the internal market of Greece would have no need for Euros. Trade and production would resume their daily routines, and GDP would march onward, without skipping a beat. Not being a part of the Eurozone would not be considered that "bad" by the citizenry of Greece, making a Grexit not only look desirable, but also doable.
This will stop the vicious cycle of Greece having to borrow ever greater amounts to pay back a loan ever harder to service. In return, Germany has promised Greece donations of humanitarian aid, aside from forgiveness of a portion of Greece's debts to Germany. Is Varoufakis advocating this change? Unlikely.