The agreements that established the euro contain no provisions to allow exit. However, if some government – let us suppose the Italian one – decided to leave, there is nothing Europe could or would do to stop it. But what exactly would a government set on such a course – or forced into it – do?

The objective would be to establish a currency – the new lira – which would substitute for the euro in domestic transactions but sell at a discount to the euro in international transactions. A bus fare of one euro would become a bus fare of one new lira but the external value of the new lira might fall to 75 euro cents in financial markets.