Business: Deflation in Greece

Shops all over Athens were closing as the drachma skidded from 1¼ trillion to 2½ trillion for a U.S. dollar. Early last month, facing the worst inflation in Europe (TIME, Nov. 6), the Greek Government issued new drachma notes based on gold. Then it levied a tax of 1,500 gold pounds (about $8) on each of the country's one thousand richest citizens to get additional backing for the currency. By last week the gold cure seemed to be working. In general, prices had stabilized. Cheese, butter and eggs were still high in Athens, but prices of peas, beans and macaroni were...

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