Warren Mosler (for example, here) has explained very clearly and succinctly the key steps involved in effectively introducing a currency such as the drachma. (See, also, Bill Mitchell’s recent post, ‘A Greek exit is not rocket science‘.) Fears of exchange-rate catastrophe would be unfounded if these steps were followed....heteconomist
Introducing a New Currency
Peter Cooper
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Also from the BBC - Greek debt crisis: How easy is it to swap currencies?
The country will have to decide how they will handle private sector loans denominated in Euros, Banking System obligations (to the ECB or interbank lending) in Euros, and Sovereign borrowing that has in Euros..
Whether the Greek Central Bank can remain a member of the ECB to allow for an easy and smooth transition will be essential as well. If they are thrown out of the Euro with no access to the ECB, the banking system will have no choice but to re-denominate bank accounts, especially given the advanced state of the bank run that has already occurred. Europeans are actively hostile toward Greece --In all likelihood they will seize all collateral posted by Greek Banks to the ECB... leaving the banking system under-capitalized as well. Since Greece has defaulted/in arrears with the IMF, they don't have as many options as they would have if they had under taken a well planned transition to Drachma.
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