In or out of the eurozone: Greeces options

OPTION-I: EXITLong taboo, what economists call Grexit is back on the table after inconclusive Greek elections this month that gave anti-austerity and anti-EU parties the majority but failed to produce a working coalition.Should Greek voters return a working coalition of anti-austerity parties at a re-run of the elections on June 17, and should those parties refuse to adopt reforms demanded in March in exchange for a second EU-IMF bailout, it will be game over and exit from the euro for Athens.Greece then would find itself with a devalued drachma currency once more, facing a sharp spike in inflation, even higher unemployment and the danger of a vicious circle of depression, even if exports became more competitively priced.OPTION-II: REFUSAL OF AUSTERITY REFORMS, BUT EURO MEMBERSHIP HELD ANYWAYIn this scenario, an anti-austerity coalition takes power in Greece but decides to remain in the eurozone, according to the wishes of three out of four Greeks.But this would quickly end in an impasse as the financial lifelines offered by the European Union and the International Monetary Fund -- to replace prohibitively expensive money-market finance -- would quickly be halted.Triggering default, Greek and other eurozone banks would suffer badly and there would be a risk of contagion to members like Spain that ultimately could result in eurozone implosion.OPTION-III: AN EASING OF BAILOUT CONDITIONSFormally ruled out so far, and a hard sell to public opinion in countries which have shelled out on successive Greek rescues but who now face recessions of their own.Nonetheless, there is scope for debate on adjustments in timetables for meeting individual conditions -- as suggested by eurozone leader Jean-Claude Juncker of Luxembourg. This could help pro-EU parties improve their score in the June repeat polls, according to one EU source.OPTION-IV: FULL IMPLEMENTATION OF REFORMSThe ideal scenario for eurozone partners would see Greece re-emerge from debt repayments with a leaner and meaner reformed economy after implementing reforms demanded by its international rescuers.This is a long, long way off at best, say analysts.