Ow wait no that would be an implicit claim. Ehm. You know what I mean. Discuss.

Interesting. I never really thought of this, actually. Countries used to worse than this to pay their debts though, iirc

more likely solution (for greece) is a simple national default. Sovereign nations are allowed do that, right?

it might result in an agreement for them to leave the Euro-zone, but just as we run on a fiat money system - there is probably nothing stopping a fiat (declaration) that greece will not be paying off it's debts (except perhaps money owed by banks to greek citizens - the government doesn't want to burn the people who elect it... once you know, a government is formed)

Why would the other countries of Europe, to whom Greece is in debt, particularly *want* to own some random rocks near Greece?

Actually, the ownership of these rocks are disputed and also causes never-ending troubles between Greece and Turkey regarding continent-shelf issues and territorial waters.

So to sell these islands, Greece has to put aside its national pride. However, it is a common phenomenon that when an economic crisis hits a country it also boost the nationalism. So considering the increasing support to nationalist parties in Greece, (just check the recent elections or look particularly for the golden dawn party) it is very unlikely a solution that would be adopted by the Greek government.

It would surely help though. Also, Turkey would not miss to take advantage of this once in a life-time opportunity... xD

But, like orathaic said, and because of the national pride, they would prefer leaving the Eurozone to selling the islands.

Well, deal accepted. Let them leave the Euro-Zone. When you proposed the island thing, the least it's another serious attempt to keep them in.

*I'm a little drunk, I shouldn't be posting on this forum. Dang.

the 'leave the euro-zone' and default on national debt solution doesn't do much... well actually it massively helps greece in the short term - internally inflation is not caused by over-spending, austerity measures are not needed to pay off debt - however inflation is caused by capital flight (and until that inflation balances out, ie whenever investors 'trust' that the greek economy has hit rock bottom, the capital flight continues...

of course there may be a possible option which includes controls on capital flow (i'd suggest a rate limiting effect, something along the lines of $ per day in/out of the system limited to some percentage of GDP) but with massive capital flight you may need internal lending systems to get the economy moving (or large-scale printing of money, which will push the inflationary pressures)

the positive for greece is that all of these problems become short-term issues.

Great, except for the people who the greeks owe money to, every bank and euro-loan not paid back undermines the banking systems (and due to nationalization of private banking debt the governments) of the rest of europe. The whole systems loses confidence, facilitating more capital flight, and lose of value of the Euro on the international exchange... (which will eventually make all european exports pickup, as the price of european labour drops below that of chian/india... but that's a long time-a-waiting.... and in the mean time Germany has a huge economic advantage over the austerity countries - leading to terrible inequality, and further break-up of the euro...)

So instead we're not going to do that, we're going to appease the non-german nations by bailing them out again.=> reduce inequality => reduce instability => fail to provide confidence that this is even possible => slip further into recession...

There was a rumour about 6 months ago that the casinos in Los Vegas had got together offered $<insert ridiculous amount here> for sovereignty of a Greek island. Total sovereignty, including tax gathering, law making, law enforcement, immigration, hooker licensing and debt collection.

to build a casino island in the med, probably a great plan, except for the security considerations in the region (mostly the turkish-greek dispute, and as they are both NATO members it seems neither will get NATO to defend them if a conflict did arise)

they'd also want a private airstrip... which islands would be big enough?

Airfields? Almost all of them. And ports for the cruise liners full of rich tourists.
They would provide their own security. I imagine that after the head of state of the first country to act aggressively towards them has been assassinated (Casinos==Mafia?) the other countries would be less interested in giving them a hard time. And I doubt they'd sign extradition treaties with any other country, so all the crooks/bankers/ex-politicians (and their money) would go there.

@ SpeakerToAliens:

"There was a rumour about 6 months ago that the casinos in Los Vegas had got together offered $<insert ridiculous amount here> for sovereignty of a Greek island. Total sovereignty, including tax gathering, law making, law enforcement, immigration, hooker licensing and debt collection."

That would in effect be the establishment of a new country. I'm not sure how European goverments would react to that. Would they want to apply for EU membership?

"Why would the other countries of Europe, to whom Greece is in debt, particularly *want* to own some random rocks near Greece?"

Well...

1. We're never going to get our money back.
2. We shouldn't cripple their economy by trying to get it back.
3. We shouldn't accept that other countries don't respect their agreements with us.

Well, the transfer of countries could be a compromise. Of course, that would liberate Greece from its financial obligations and by performing *voluntary* payments to the other European countries they can, one by one, get the islands back.

Simple solution:

-Create an independent country on one uninhabited island.
-Sell all Greek bonds, loans and other debts to said new country for €1 (which someone must drop on said country first to prove it owns this money)
-Liquidate said new country.

Frankly, I can't see a negative side to this. The markets would love it.

"Create an independent country on one inhabited island"...

If it was in any way clear that the purpose of creating this country was to transfer debt to it (with the intention that those debts would not then be paid off), I think it would be unlikely that other countries would *recognise* the creation of the "new country".

I don't think this trick would work.

To make my point clearer - it would, for example, currently be impossible for Greece to transfer all it's EU debt to the micronation of Sealand, because the EU does not recognise Sealand as a genuine state.

Yeah, I wasn't particularly serious.Although it owuld allow Greece to 'get rid of its debts' without leaving the euro, so you never know. Germany might take something like that out of desperation.

Greece could help pay off its debts by flogging some of its monuments. Frankly the Parthenon has been seperated from its marbles for too long, and the whole world will benefit from seeing them reunited in London where they belong!

Why would I want to sell my debt to a micronation as a part of a coordinated action? If everyone else did it, I would have quite a guarantee that I would actually have my money back. There's a huge inherent freerider problem, unlike in voluntary haircut that already happened.

Also, what sovereign country would benefit from barren rocks somewhere in the Med? They are completely useless, that's why they are uninhabited. Unless you are Turkey (in yer face, Greece) or suffer from badly directed ambitions (landlocked country who wants to get in some pop quiz with "Which landlocked country has a maritime exclave?") that is.

@Jaimiet99k -
"I'm not sure how European goverments would react to that. Would they want to apply for EU membership?"
I'd think the politicians would want to apply for premium casino membership - the one with tax-haven status...