The Greek Bank Holiday: This is What an Economic Collapse Looks Like

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By Daisy Luther

A “bank holiday” sounds like such an innocuous thing, doesn’t it?  Playful, a well-deserved rest, maybe even fun. If you’d like to learn more about the fun of such a holiday, look no further than the streets of Greece, where people have been informed the banks will be closed for the next week.


Because the European Central Bank has stopped sending in the money that was keeping the Greek financial system afloat. Had people been able to go to the bank and withdraw their money, the banks would be unable to function. So, the banks said, “Nope, you can have $60 if you want to wait in line for long enough to get it.”

Yes, you’re understanding this correctly: the banks are keeping afloat using the money from people’s accounts. The Greek stock markets did not reopen today. This is a last-ditch effort from the Greek government to prevent total economic collapse.

The situation there is dire, and much like Venezuela, it’s a case study for anyone who believes that an economic collapse of our own financial system is imminent here in America.

We need to pay attention to what’s going on in Greece. This is what a real economic collapse looks like. It isn’t a Mad Max scenario or a scene from some other post-apocalyptic movie.

It’s quiet desperation, long lines, and a sick feeling in the pit of your stomach as you wonder how you’ll feed your kids and keep a roof over their heads. It’s the discovery that you thought you had been doing the right thing financially, but you were deceived. It’s the realization that everything you worked for your whole life is gone.

The lesson in one sentence: if you don’t have your money in your hand, you’d better have tangible assets like a pantry full of food and the supplies needed for complete self-reliance.

Here’s how it affects the citizens of Greece

First of all, this article isn’t about the poor financial decisions of the Greek government, whether social aid programs should exist, or if a bailout should have occurred in the first place. It’s about the real-life ramifications of an economic collapse on ordinary citizens who depend on fiat currency, consumer goods, and the availability of their wages when they need them.

A decree published by Greek Prime Minister Alex Tsipras cited “the extremely urgent and unforeseen need to protect the Greek financial system and the Greek economy due to the lack of liquidity caused by the Eurogroup’s decision on June 27 to refuse the extension of the loan agreement with Greece.” The following restrictions will be in place:

The following restrictions will be in place:

  • All banks are closed until July 6
  • ATM withdrawals are limited to 60 Euros per day (the equivalent of about $60 USD)
  • People using bank cards from other countries will not be limited to 60 Euros per day (so this won’t affect tourists aside from the long lines.)
  • The Athens stock exchange is closed today.
  • Pensions and wages will be unaffected – which means they’ll still be electronically deposited into the accounts that no one can access.
  • Debit and credit card payments will continue to work.
  • Online transactions within the country will continue to work
  • Foreign transactions will be prohibited without Ministry of Finance approval
  • Urgent expenditures ““necessary to safeguard a public or social interest” must be approved by a banking commission
  • Interest surcharges for this week are prohibited
  • Banks that break these rules will be charged a fine of 10% of the value of the transaction

The statement issued by the prime minister allows for the bank holiday period to be shortened or extended by his discretion.

Greeks are scrambling to stock up on food and fuel.

Despite the fact that Greece has been clinging to the lifeline cast to them by the European Central Bank for several years now, people are still hit hard by the bank closures.  It’s easy to say, “Why on earth do they have money in the bank?”

However, their system is much like ours – it’s nearly impossible to function without a bank account. For example, pension payments and wages are nearly all paid by automatic deposits directly into one’s bank account. If you have a car payment or a mortgage payment, it comes out of your bank account – you don’t go and pay cash for it. The system is designed so that access to your money is not your own.

An article on Zero Hedge featured Tweets with photos of the long lines for grocery stores, ATM machines, and fuel stations as people desperately try to turn their Euros into tangible assets.

This is affecting stock markets everywhere.

This isn’t just a problem that affects Greece. Stock markets across the globe are plummeting in the aftermath of the bank holiday.

In London, the FTSE dropped by 2%. The French and German markets dropped by 4%, and the European banking shares dropped by a hefty 10%. Tokyo lost 3% and Hong Kong dropped by 2.5%. Michael Hewson, chief markets analyst at CMC Markets UK,

Michael Hewson, chief markets analyst at CMC Markets UK, said we can expect the effects to be far-reaching. “The Greek butterfly looks set to cause a tornado in financial markets.  In the process we could well also find out if this event turns out to be the equivalent of the butterfly flapping its wings in New Mexico, going on to cause a hurricane in China.” This far-reaching effect is probably because Greece can be expected to default on $1.77 billion dollars in debt to the IMF.

This far-reaching effect is probably because Greece can be expected to default on $1.77 billion dollars in debt to the IMF.

What we can learn from the collapse of the Greek economy

If you’ve been paying attention to the goings-on in Greece, you probably recall the 2010 riots, when a harsh austerity program was introduced as part of the terms of a bailout from the IMF (International Money Fund) the European Commission, and the European Central Bank (ECB).

In actuality, the country has been floundering financially since 2007, when their first recession hit. This most recent crisis has occurred because the bailout money, which was divided into four major payments, may not be continued, which will result in massive debt defaults.

Does any of this seem familiar? Our own government has been working on a deficit for may years, except instead of taking money from loan sharks entities like the IMF, our government has opted to just print more up and pretend it’s backed by something besides dreams and fairy dust.

If things progress on our current route, what you’re seeing in Greece right now could be our future. And not a distant 20-years-down-the-road future. Our near future.

How do you prepare for something like this? Well, first things first, you don’t leave your money in the bank. It’s perfectly understandable to have your paychecks deposited and your payments withdrawn, but once your bills are paid, the rest of it needs to come out. Then, keep enough on hand to meet your bills for a few months and invest the rest in tangible assets like

I personally don’t keep more than the bare minimum needed for monthly bills in the bank. I have a serious mistrust of these establishments, especially after what we witnessed a couple of years ago in Cyprus when the government there took money directly from people’s accounts, triggering panic and bank runs across Europe.

We aren’t protected here in the United States either – it is blatant that the banking industry is setting us up for the potential of a similar situation. Deposit accounts are no longer legally protected and the Federal Reserve passed a policy that in the event of an economic crisis (think “bank run) that accounts can be frozen to preserve the liquidity of the banks.

All of this seems to point in the direction of what we’re seeing in Greece, doesn’t it? It seems like the game pieces are being moved around the chessboard to be able to legally seize or control whatever you have in the bank.

Most folks who are paying attention to the financial news in our country are not big fans of fiat currency, but at this point in time, it’s a necessary evil. Please don’t clog the comments section raving about the fact that cash is not real money. While I realize it is backed by nothing but happy thoughts, it’s still important to remember that in the world that exists today, government-issued currency is most likely to be the unit of trade needed.  Most mortgage companies don’t accept payments in gold ingots, and your mechanic might look at you funny if you present him with a pile of silver coins to pay for a car repair. I recommend that you keep at least one month of expenses physically on hand, in cash.  This is instantly available, easily recognizable as money to those who are

I recommend that you keep at least one month of expenses physically on hand, in cash.  This is instantly available, easily recognizable as money to those who are uninformed, and simple to trade for goods or services.

What do you need to survive the end of the consumer lifestyle?

Once you have the money set aside to keep you afloat, it’s time to go hard into preps.  Think about what you need for self-reliance: what if you could never again just go to the bank, get money, then purchase the things you need? Look no further than

Think about what you need for self-reliance: what if you could never again just go to the bank, get money, then purchase the things you need? Look no further than the collapse of Venezuela to see the items that are extremely scarce there.

“What can you store?” is not the right question to ask.

“What can you make?” – that’s the right question.

Your focus has to be on long-term sustainability, frugality, and self-reliance.  Don’t get me wrong – a stockpile is sensible and an essential course of action. It should definitely be part of your preparedness plan.

However, you need to also be ready for the time when the supplies in your well-stocked pantry are no longer available.  You need to be able to meet as many of your own needs as possible or you’ll end up being one of those people wearing dirty clothes because you can’t find laundry soap or going hungry because you can’t find any food at the stores – or can’t afford it if you can find it. You need to be ready for the end of a consumer-driven lifestyle, because quite frankly, there may soon come a day when there are no consumer goods to be had. Here are some ways to work on your

Here are some ways to work on your self-reliance:

It’s only by reducing your need for the things sold in stores that you can exempt yourself from the chaos and desperation that will erupt when or if an economic collapse situation occurs here.

Knowledge and skills are among the most important things you can “collect” to prepare for an economic collapse. However, if you haven’t been at it your entire life, it’s difficult to remember everything. Create a library of references to help you in your quest for self-reliance.

These are some of my favorites:

Once you have an amount saved that is greater than your one month of cash, and once you have all the tangible preps you can store, only then should you consider investing in precious metals. Gold and silver retain their value far better than the dollar, and the metals are easily liquidated if an emergency arises and it becomes necessary to change them to fiat currency.

This being said, metals are harder to spend, and it takes a little bit of effort to cash them in, so it can help deter you from spending unwisely if you tend to have difficulty saving money. Reputable companies exist that allow you to do all of your transactions online and have the metals shipped to your home, taking the hassle out of acquiring them if you happen to live in a remote area.

World events are our crystal ball

I’ve been warning specifically about this impending financial doomsday since the beginning of the year. In my New Year’s Day post, I wrote:

Not only would your money be worthless, here a few more ways the current economic trends may still affect you.

Prices will go up. We’ve seen an almost unprecedented increase in the price of food over the past couple of years, even as the quality of the food available plummets. This is due to massive droughts, early freezes, and basic cost-of-living increases.

Unemployment will continue to ripple through the country.  Those without jobs now are equal to the number of unemployed during The Great Depression. As the economy plummets, that number will almost certainly exceed the previous highs.

Obamacare mandates will continue to impoverish the middle class.  The most ill-conceived policy in history, Obamacare has increased monthly payments while decreasing coverage for nearly every person who is gainfully employed.  And, if you refuse to procure coverage through Obamacare, expect attempts to penalize you into compliance. This is adding to the unemployment rate as employers struggle to keep their doors open and drop full time staff to avoid having to pay their portion of the O-care payments.

Rents will increase.  If you don’t own your home, prepare to pay higher rent as landlords try to cover their losses of income in other sectors. Foreclosures will be on the rise, which means there will be fewer homes available.

The bottom line is, income will remain the same, decrease, or even disappear entirely for many of us.  Meanwhile, the price of darn near everything will go up.  Expect to pay more for things like keeping your utilities on, feeding and clothing your family, keeping a roof over your heads. Aside from that, those dollars you are carefully saving? They are only providing you with the illusion of security.

Bloggers like Michael Snyder and Mac Slavo concur that we are right on the edge of a crisis the likes of which our generation has never seen. Pay attention to the breaking news out of Greece. On July 5, the decision will be made whether any further bailouts will be headed their way. If none are forthcoming you can expect the bank holiday to be extended indefinitely.

Also note that:

The events occurring in the European banking systems (Cyprus and Greece in particular) are a glimpse into our future. I can’t ring the warning bell any louder than this.

Our way of life is about to change, and you can prepare for the new reality or be one of those desperate people in long lines, hoping for some mercy from the people who put us in this situation.

Picture of Daisy Luther

Daisy Luther

Daisy Luther is a coffee-swigging, globe-trotting blogger. She is the founder and publisher of three websites.  1) The Organic Prepper, which is about current events, preparedness, self-reliance, and the pursuit of liberty on her website, 2)  The Frugalite, a website with thrifty tips and solutions to help people get a handle on their personal finances without feeling deprived, and 3), an aggregate site where you can find links to all the most important news for those who wish to be prepared. She is widely republished across alternative media and  Daisy is the best-selling author of 5 traditionally published books and runs a small digital publishing company with PDF guides, printables, and courses. You can find her on FacebookPinterest, Gab, MeWe, Parler, Instagram, and Twitter.

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  • Fear monger, rents haven’t increased! At the first of the year you could rent a small tent in someone’s backyard in Silicone Valley for $1000.00 a month and you still can. lol! Ok, time to get serious. Excellent article, but maybe even you print a much too rosy picture for what will really happen. Having spent my career in the transportation industry, trucking is the big trigger that can create unparalleled havoc in America. There is no truer saying than, “If you bought it…A truck brought it.” If the banks cannot extend credit, due to whatever reason, to the trucking companies then the trucking companies cannot purchase fuel. All trucking companies, no exceptions, borrow money daily for fuel and repairs on the road. No trucking company has the financial wherewithal to keep their trucks moving, not even for one day, without massive influxes of cash. The banks transfer funds en mass to Comdata. All trucking companies use Comdata and all truckstops accept Comdata. Without credit and Comdata, trucks go no further than the fuel in their tanks will allow. And if those trucks run out of fuel and stop, even for a short time, three days or more, then it’s over for us. I am not qualified to talk about any other segment of our economy, but I know trucking and when they grind to a halt, we are dead. Period!

  • Just yesterday read about the financial crisis in Puerto Rico. They are an American territory. Their people are American citizens.
    They are 72 Billion dollars in debt. What now?

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