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Thursday, July 9, 2015

It looks like the drachma has resurfaced in Greece (GREK, EUR)

The drachma is back. Unofficially. On Saturday, a Bloomberg reporter's credit-card records listed a transaction at the Hilton Athens in "Drachma EQ" instead of in euros, which is still Greece's currency. Bloomberg reported Thursday that the amount on the statement was the same as it would have been in euros. A currency switch is viewed as the absolute worst-case scenario in Greece's bailout crisis. Currently, Greece and its European creditors are seeking to broker a deal where Greece can re-open its banks — which have been closed for over a week — with Greece also getting the bailout funds it needs to meet its debt obligations. Currently, Greece is in no bailout program after it missed a payment to the IMF on June 30. An exit from the euro could very well mean Greece would have to dump the currency and revert to the drachma, a process that is likely to be a logistical nightmare. Currency changes usually require several months of planning and the wide support of the people who will use it — something Greece isn't guaranteed. The drachma is also likely to start out very weak against the euro; with all of Greece's economic challenges it's not a currency investors would want to pile into. Bloomberg noted that the currency on the statement was switched to the euro after the reporter started making calls about the error. So, potentially just a Freudian slip, but with tensions high in Athens people are noticing everything. Head over to Bloomberg for the full story »SEE ALSO: Switching to the drachma will be a nightmare for Greece SEE ALSO: A Greek lawmaker reportedly has a team preparing the groundwork for a return to the drachma Join the conversation about this story » NOW WATCH: This animated map shows how religion spread across the world


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