Yes. Which is an unusual step and very partisan of them to do.
I know I'm a terrible one for endorsing rational actor theory but I'm going to call bullshit on the IMF on that one. It just sounds like rhetoric/bluffing. It's in their interests and the interests of everyone to use the 30 day period.
It's already happened, Owlie.
The very, very first, immediate, right out of the gate step that a central bank does if it's actually doing everything it can is lower the benchmark rate to 0-25 basis points (i.e. %0.0-%0.25). There's more then that but if you aren't doing that then everything else is pretty irrelevant anyway. It took the ECB four years to even get started.
But my point stands: They've been at it a year and inflation still is way too low!
By the way, about the California/Greece comparison: Isn't there a mechanism for broke states to be put under federal administration in exchange for help with their debt? That would indeed be a good solution for Greece - as Sheb said, I occasionally advocate colonialism
- but I hope you see why this is not feasible politically.
Let me try to reframe this: How would you as Chancellorette Mainiac have dealt with the crisis? (How you'd deal with your gender change is another story
)
Don't forget. Europe is as finacially strong as it is now, mainly because the Allies absolved nearly all of Germany's war debt after WWII, as an important pillar of the Marshall plan.
Freudian slip?
Anyway, clearing all of Greece's debt would be a short-term solution at best. What keeps Greece (and Italy, and Spain, and evventually Germany) from doing the same thing again and just counting on all debt being taken away?
Or more recently, when the Berlin Wall came down, all of the DDR's debts were absolved (and all Ossi's got a 100 Dmark "welcome gift"), which allowed Germany to remain the strongest economy in Europe.
Because reunification was such a smart move, yeah, and precisely no-one is troubled by Germany being a European hegemon now, least of all the Germans themselves...