Euro Area

[Beskar]

Problem is not the Euro, it is the USA in causing this crisis in the first place.

[Vladimir]

Problem is not the Euro, it is the USA in causing this crisis in the first place.

Just admit it: We control the world. Everything good or bad that happens to Europe is because of us. We are your masters.

[rory_20_uk]

Then why is it the Euro in trouble, and not a host of other countries?

The events have stressed the system and the weak ones are failing. The good times merely hid the problems.

[Beskar]

Then why is it the Euro in trouble, and not a host of other countries?

The events have stressed the system and the weak ones are failing. The good times merely hid the problems.

It is other countries in Trouble, America, US and other countries.

Even China took a hit to their profit margins due to the decrease in demand.

Main problem was a couple of European countries which abused their budgets. There are other nations such as Germany who are having no where near the issues of the UK, so it isn't a 'Euro' problem.

[Furunculus]

Problem is not the Euro, it is the USA in causing this crisis in the first place.

are you saying that if it wasn't for the fact that complex systems (such as the global economy) tend to throw out black-swan events (such as the great depression) it would be fine to deliberately implement fundamentally flawed economic regimes (such as the eurozone)?

there is no other way to say this: monetary union without a political union to legitimise the necessary fiscal union does not work, because you need to transfer wealth from rich areas to poor areas to prevent market fracturing, and that tends to lead to seccession or civil-war unless the parties involved have given their prior consent.

there. is. lots. wrong. with. the. eurozone.

right. now.

Main problem was a couple of European countries which abused their budgets. There are other nations such as Germany who are having no where near the issues of the UK, so it isn't a 'Euro' problem.

and unless a black swan event comes around we could continue to pretend that it didn't matter that the eurozone economies were diverging further and further away from being an optimal currency unit, but sadly real life happens, and will happen again and again and again.

[Beskar]

are you saying that if it wasn't for the fact that complex systems (such as the global economy) tend to throw out black-swan events (such as the great depression) it would be fine to deliberately implement fundamentally flawed economic regimes (such as the eurozone)?

there is no other way to say this: monetary union without a political union to legitimise the necessary fiscal union does not work, because you need to transfer wealth from rich areas to poor areas to prevent market fracturing, and that tends to lead to civil-war unless the parties involved have given their prior consent.

there. is. lots. wrong. with. the. eurozone.

right. now.

There is nothing fundamentally wrong with the concept of a single currency. Yes, there needs to be more harmonization but that is occurring anyway with the rise of globalization. The issue was the individual poor governance by countries leading to a situation they could not manage if they were administrated better.

As for the "need to transfer wealth from rich areas to poor", isn't that happening anyway? As our western money flows in the piggy bank of nations such as India, Brazil and China, the market does this in itself.

[Furunculus]

There is nothing fundamentally wrong with the concept of a single currency.

As for the "need to transfer wealth from rich areas to poor", isn't that happening anyway? As our western money flows in the piggy bank of nations such as India, Brazil and China, the market does this in itself.

no indeed not, provided there is a fiscal union to go along with currency union.
http://www.euro-know.org/europages/articles/rmu.html

it is one thing is lack of competitiveness pushes foriegn direct investment away from your nation, it is quite another if your elected representative decides to subsidise the easy living within another country!
http://israelfinancialexpert.blogspo...k-bailout.html

[gaelic cowboy]

It is quite clear to me now that most people here are missing the point of this thread completely.

A Eurozone debt default does not destroy the Euro, nor does debt restructuring end in countries having to leave the Euro.

Trying to maintain the value of the bad euro loans will break the euro if we try to pretend they wont be restructured later.

Sounds funny cos its the same result but you have strangled domestic demand and encouraged capital flight to non euro countries which is a killer for a currency.

[Furunculus]

are you saying that if it wasn't for the fact that complex systems (such as the global economy) tend to throw out black-swan events (such as the great depression) it would be fine to deliberately implement fundamentally flawed economic regimes (such as the eurozone)?

there is no other way to say this: monetary union without a political union to legitimise the necessary fiscal union does not work, because you need to transfer wealth from rich areas to poor areas to prevent market fracturing, and that tends to lead to seccession or civil-war unless the parties involved have given their prior consent.

there. is. lots. wrong. with. the. eurozone.

right. now.



and unless a black swan event comes around we could continue to pretend that it didn't matter that the eurozone economies were diverging further and further away from being an optimal currency unit, but sadly real life happens, and will happen again and again and again.

haha, it seems i have pre-dated an economist article saying mcuh the same thing:

http://www.economist.com/blogs/bligh...urs_blame_game

Ed Miliband says sorry for everything apart from spending too much

................ After the longest economic expansion in British history, the government should not have still been borrowing to spend. Instead of going into the recession with a warchest, it went in with a deficit. Recognise this error, say sorry, take the hit, and move on, would seem to be the intellectually honest and politically canny thing to do.

Instead, Ed Miliband has manouvered his party into a bizarre and extremely unpromising position. In recent op-eds, yesterday's speech to the Fabian Society conference, and today's appearance on the BBC, he has rejected the notion that Labour overspent. The 2.4% deficit the government was running would have been fine, he says, were it not for the banking crisis, which caused tax revenues to evaporate while requiring massive amounts to be spent on bailouts and fiscal stimuli.

In other words, if only economic growth were endless, if only recessions did not happen, if only this pesky "economic cycle" thing would go away, governments could spend freely and perpetually. As many commentators have noted, this is grimly redolent of Gordon Brown's insistence that "boom and bust" is something that can be transcended, rather than a cold reality that governments must make preparations and provisions for...........

[Furunculus]

interesting article on how the ECB is exacerbating the problem of a sub-optimal currency zone:

http://www.economist.com/blogs/freee...etary_policy_1

[Furunculus]

oops, it would appear that not everyone is delighted with the Sarkozy/Merkel template Pour Das European Economy:

http://www.spiegel.de/international/...745383,00.html

hilarious that people might have believed otherwise..........

[Louis VI the Fat]

oops, it would appear that not everyone is delighted with the Sarkozy/Merkel template Pour Das European Economy:

http://www.spiegel.de/international/...745383,00.html

hilarious that people might have believed otherwise..........

Meh. Merkel and Sarkozy needs to grow some and send the German tanks across the European plains, backed by French nukes and aircraft carriers.


Europe needs Teutonic discipline, not Greek thievery, Italian bookkeeping, Irish 'look mama no taxes' capitalism, East European mobsters/ultra-conservatists.

I don't care how much the little piggies mewl, the days of their socialist paradises and 'private profits, socialised risks'-capitalism must be over. Merkel must do to Europe what Thatcher did to Britain and impose some old-fashioned discipline.

[Tellos Athenaios]

Hmm, what is “Teutonic discipline” worth in the boom years? Nothing more than the “Gaulish” version, which as you might remember means breaching such pacts.

[gaelic cowboy]

I don't care how much the little piggies mewl, the days of their socialist paradises and 'private profits, socialised risks'-capitalism must be over. Merkel must do to Europe what Thatcher did to Britain and impose some old-fashioned discipline.

The socialised risk is there because of the EU, there up to there necks in Eurozone IOU papers.

No bailout no socialised risk scalp the bonds now

[Furunculus]

Europe needs Teutonic discipline, not Greek thievery, Italian bookkeeping, Irish 'look mama no taxes' capitalism, East European mobsters/ultra-conservatists.

so the 'cause' of europe needs everybodys ideas on representative and democratic governance........................ as long as they are franco-german ideas?

[Philippus Flavius Homovallumus]

Meh. Merkel and Sarkozy needs to grow some and send the German tanks across the European plains, backed by French nukes and aircraft carriers.


Europe needs Teutonic discipline, not Greek thievery, Italian bookkeeping, Irish 'look mama no taxes' capitalism, East European mobsters/ultra-conservatists.

I don't care how much the little piggies mewl, the days of their socialist paradises and 'private profits, socialised risks'-capitalism must be over. Merkel must do to Europe what Thatcher did to Britain and impose some old-fashioned discipline.

So that would actually British dicipline, then? Why not couple that to British notions of honestly, fair play and public service? No?

Nothing we do here is ever popular on the mainland, unless they can claim they did it independantly, and it is somehow innate to a European people on a genetic level.

And yet we continue to be insulted by being labled "Europeans".