Could this be the end of the EURO

HairyPeggy01


Joined: 01/09/2010
Posts: 24

Message Posted:
13/11/2011 01:14

Can the Euro survive, when total debt throughout the bloc appears to be greater than the bloc itself can repay in my grandchildren's lifetimes?

When austerity measures, designed to make sure national incomes match their expenditures are creating public disorder on a grand scale, bordering on revolution?

When there is growing dissatisfaction with the Germans strutting around kick-assing its neighbours and demanding changes of governments in exchange for their money?

I think not - and the cracks are already appearing, as the German Finance Minister tells the UK that as they are not in the Eurozone, they should stop giving advice. A petulent outburst from a nervous man who can see the writing on the wall?

Actually, I would have thought that a nation with the good sense not to enter the German inspired Eurozone is well-worth listening to.

lovingcyprus


Joined: 02/03/2007
Posts: 1272

Message Posted:
13/11/2011 01:20

Wasn't the wall taken down many years ago!!!!!!!!!!!!

andre514


Joined: 05/10/2010
Posts: 763

Message Posted:
13/11/2011 03:28

muttering seems to be beginning in britain that the eurozone should be

systemetically dismantled rather than face its catastrophic collapse



but france and german leaders have far too much political capital invested

in the unworkable, to face the inevitable



...he suggested somewhat tritely

Groucho



Joined: 26/04/2008
Posts: 7993

Message Posted:
13/11/2011 07:49

There is a phrase ready and waiting for the Euro, it's 'dead man walking'.

The sooner the various heads of government realise that, agreeing more debt to alleviate debt with no future new means to pay the increased debt is a recipe for disaster, the better. Who controls the debt is the victor and we certainly don't want that to out of Europe's control.

America (the major cause of the problem) appears to be burying its head in the sand and hoping it will all just go away - i.e. they have no political will to introduce austerity measures to address the problem of their mounting debt. Whoever promises low taxes and better standards of living will win in the US as they seem unable to grasp the fundamental problem with their borrowing habit.

Tenakoutou



Joined: 27/07/2009
Posts: 4110

Message Posted:
13/11/2011 08:29

Isn't the Yanks' answer always to simply print more money without admitting any devaluation of the $ as a result?



How on earth did Germany and France get sucked into believing that the southern Mediterranean countries would suddenly adopt a 'work ethic' - never mind become industrially minded, or active?



This inevitable Eurozone 'time bomb' has been ticking for far longer than most people realise - same as the Cyprus bank mortgages situation.



How far off is the day of reckoning for either?



The Cypriots [under their current 'legal' system] are counting on the fact that they have the foreign buyers' assets - their houses - to [eventually] cash in on - but what does Germany and France have, apart from a few historical ruins in Greece and Italy?

pollymarples


Joined: 08/08/2010
Posts: 1778

Message Posted:
13/11/2011 08:44

hysterical ruins, would that be their economy, sorry you said historical.

andrew4232



Joined: 04/07/2009
Posts: 1543

Message Posted:
13/11/2011 08:44

i think hopes that the euro will go are just dreams its going to be here for a long time and the germans will not allow it to go as we all know

DutchCrusader



Joined: 19/05/2008
Posts: 11281

Message Posted:
13/11/2011 10:05

The Euro Zone does not have many British fans in Northern Cyrus, I know, and those Brits have of course the right to hope for or expect an "Euro-quake".

But I wonder if the anti's or pessimists realise the horrible consequences for world trade, the Continent AND the UK.

Before expressing pessimistic thoughts and hopes it really would help to read more (in serious newspapers). For instance this: "Speculation about the impacts of the possible break-up of eurozone is rife. It is of course only speculation and the only thing economists really agree on is that a double dip recession in the UK is becoming increasingly certain as the eurozone crisis intensifies, particularly given the current weak growth figures. The collapse of the euro would guarantee another recession."

More here: ▶ [ http://www.guardian.co.uk/politics/reality-check-with-polly-curtis/2011/nov/07/economy-euro ]

[more]

DutchCrusader



Joined: 19/05/2008
Posts: 11281

Message Posted:
13/11/2011 10:07

[continued from msg 8]

And here are more sources for a balanced view on the looming problem for the UK:

▶ [ http://www.google.com/search?q=consequences+of+euro+collapse+for+uk&hl=en&num=10&lr=&ft=i&cr=&safe=images ].

Don't hope for developments that will hurt us all - but some countries and populations more than others...

Groucho



Joined: 26/04/2008
Posts: 7993

Message Posted:
13/11/2011 11:01

The Euro Zone is a good idea badly implemented.

The fiscal policies of some the member states that joined in the last 15 years were not and are not as robust as they should be. The levels of poor monetary management always augured for problems ahead. The headlong rush into enlargement was fraught with poor exercise of due diligence. Those countries, like Greece, who lied through their teeth to gain entry on false pretences will never be trusted again.

The EU regulatory bodies should be ashamed of it's lack of stewardship - they cream off enough money from the members and what do they achieve? What scams do they prevent? Nothing - They seem to take on face value all that they are told.

A gentleman's club should make sure the riff-raff don't gain membership simply by lying as to their finances and their sources.

ilovecyprus


Joined: 08/05/2007
Posts: 2880

Message Posted:
13/11/2011 11:21

The problem is that the EURO has been put together by economists and bean counters. These people are intelligent but are often absolutely clueless when it comes to understanding human drives. Any social psychologist with a good understanding of culture world say



'Hold on chaps, people don't operate solely to principles of economic self interest, you cant join cultures together without understanding the underlying mindset and cultural history that drives their fundamental actions.'



The problem now, is that in this crisis, countries are being asked to sacrifice even more of their cultural identity, to give it up for centralisation. In protecting their group identity the Greeks are mocking the Germans. This would be a typical reaction.



From what I can see, bean counters have now been put in charge of Italy and Greece without any consultation with the people. This is very dangerous as the people have not granted them permission. The fun may have only just started.

ilovecyprus


Joined: 08/05/2007
Posts: 2880

Message Posted:
13/11/2011 12:05

Just to add to msge 11



Cultures have a unique signature, something (often many things) that make them unique. In Greece this signature would have been developed over thousands of year. People will communicate group stories and hold norms that hold this signature (identity) together. When this signature is threatened the group will often come together to remind themselves of that story and to attack that which could destroy the group identity. Even if the threat is not real.



A group signature is hard to destroy. It is intangible yet quite solid. The Chinese have for years tried to destroy the Tibetan culture but the Tibetans still cling to their unique identity. I am not saying that the Germans are trying to destroy the Greek culture, far from it, however they are now exporting their own unique signature to stricken countries, who are unlikely to take it lying down.

MoonageDaydre


Joined: 09/07/2011
Posts: 70

Message Posted:
13/11/2011 21:13

"Can the Euro survive, when total debt throughout the bloc appears to be greater than the bloc itself can repay in my grandchildren's lifetimes?"

Well, nobody is doubting that the Dollar will survive are they? And the debt crisis in the USA is far worse. If you look at the economy of some of the individual states, they make Greece and Italy look like a haven of stability.

So the Euro will survive as long as the political will is there - and it seems to be.

An if the UK is doing so well, how come the inflation rate there is over 5% as against 3.5% in the eurozone.

When euro notes and coins came in back in 2002, the you could get about 1.5 euros to the pound, now its 1.14 if you're lucky, and at one stage almost hot 1 for 1.



About time some of us Brits lost our superiority complex I think!

DutchCrusader



Joined: 19/05/2008
Posts: 11281

Message Posted:
13/11/2011 21:34

@ msg 13, MoonageDaydre: The Sterling problem visualised (past 5 years):

▶ [ http://www.allcrusades.com/BB_pics/Sterling_Euro_past_5_years.png ].

BillBarnacle


Joined: 20/04/2009
Posts: 167

Message Posted:
13/11/2011 21:54

LETS HOPE SO



The Euro was flawed at the time it was created.

The EU is a corrupt and anti democratic entity

Greece and Italy are now being run by unelected officials - so much for democracy

Several other eurozone countries will follow

You are witnessing the birth of the 4th Reich and all you EU saps had better get used to being told how to run your affairs

Clarissa2


Joined: 12/06/2009
Posts: 1476

Message Posted:
13/11/2011 22:12

Re: Msgs 8, 9,13,



Thank you. These posts make difference from the usual juvenile opinions and total ignorance on the subject.

The whole world is heading for depression for the next 15 years, economic forecasts are grim on the both sides of the pond.

Yet Brits are cheering on the demise of euro, thinking that they live in outer space.

The eurozone drama will hurt the pound first and foremost. When European banks repatriate capital in the time of crisis , the euro rises and the pound falls.

We saw it in 2008 when the post-Lehman collapse caused the US dollar to rise sharply. This time the big European banks will be selling British assets which will hammer the pound.

Time to cheer?!

DutchCrusader



Joined: 19/05/2008
Posts: 11281

Message Posted:
13/11/2011 22:22

It would be interesting to read from the anti-Euro Brits how they think the UK will benefit from an "Euro-quake".

Figures and facts only please - no emotions.

rowlo



Joined: 12/10/2008
Posts: 4796

Message Posted:
13/11/2011 22:27

germany created this thing , they always wanted to be a super power , they are shit at everything except footie ? let them deal with it , frogs have now sided with them , they gave billions to other countries to join the club , alas the countries they courted , are also a useless bunch of idiots , and they will forever bail them out , think on this , greece , portugal , spain italy , what do they contribute to a eu economy ? big fat 0 , they joined for free money .and the germans are giving them it ,

BillBarnacle


Joined: 20/04/2009
Posts: 167

Message Posted:
13/11/2011 22:31

We will benefit by being FREE. It will involve some financial hardship but freedom never comes cheap

Clarissa2


Joined: 12/06/2009
Posts: 1476

Message Posted:
13/11/2011 22:50

Re: Msg19,



Free of what?

The debt, which is the size of mount Everest and is the biggest in the G20?

Who is going to lend money to the UK when its credit rating to be downgraded?

Groucho



Joined: 26/04/2008
Posts: 7993

Message Posted:
13/11/2011 22:54

MoonageDaydre

You do understand that a weak £ benefits exports and discourages imports...

PS it's not a complex if you are superior!

Clarissa2


Joined: 12/06/2009
Posts: 1476

Message Posted:
13/11/2011 23:09

Re: Msg 21,



To export something, it has to be produce first.

Oh, perhaps we can export the bankers who caused the subprime crisis in the first place?



A weak pound will cause hyperinflation, something which is already happening in the USA: money printing machines are working overtime.

ilovecyprus


Joined: 08/05/2007
Posts: 2880

Message Posted:
13/11/2011 23:21

msge 16



"These posts make difference from the usual juvenile opinions and total ignorance on the subject."



Grandiosity may seem like a good substitute for a sense of loss but it doesn't really cut it.

Clarissa2


Joined: 12/06/2009
Posts: 1476

Message Posted:
13/11/2011 23:35

Re: Msg 23,



I consider YOUR opinions neither juvenile nor ignorant.

andre514


Joined: 05/10/2010
Posts: 763

Message Posted:
14/11/2011 01:14

dc message 17:



I agree it is naiive to imagine britain would gain from a euro "big bang"

...it would indeed plunge us all into chaos



but if that is inevitable as seems increasingly possible surely an

orderly and pro-active dismantling would be far less painful?



as regards "anti Euro Brits" maybe they are just a tad weary of shelling

out twelve billion quid a year in return for a mountain of red tape

...and the offer of joining a basket-case monetary zone



if we are talking genuine free trade though I am all in favour:

britain operated a free trade regime when it was at the zenith of its

power in the late 19th century

MoonageDaydre


Joined: 09/07/2011
Posts: 70

Message Posted:
14/11/2011 01:41

"britain operated a free trade regime when it was at the zenith of its power in the late 19th century"

Dead easy when you're a colonial power isn't it? You buy raw materials cheap from a captive market, then turn them into manufactured goods and export them. So not really 'free trade' was it?

We now have free trade within the single market (which even Thatcher supported), but its complicated. If you sell your products as loss leaders that is known as 'dumping' and so has been banned by international trade treaties. But if you produce your goods with low paid labour with few employment rights, isn't that pretty much the same thing, its 'social dumping' rather than the literal dumping of goods.

The Euros demise is no more inevitable than that of the Dollar so a dismantling will not be necessary. Greece might have came close to being expelled from the EU/Eurozone, but it hasn't been, though the price they're paying is the 'troika' running the country

Geejay


Joined: 18/04/2009
Posts: 475

Message Posted:
14/11/2011 10:39

Well said Andre514. Britons were conned into believing they were entering a trading market instead of something that has turned into a monolithic political and economic monstrosity.

If the Euro can survive as a currency, fine. But if it can't, then it should be dismantled in a structured and systematic way to avoid complete chaos. Or reduced to those countries who can be relied upon to properly manage their economies.

The weakness in the Euro has always been the propensity of the French and Germans for enlargement regardless of any inherent economic or financial weaknesses. It doesn't help if you then fail to centrally regulate the currencies use, because it then inevitably becomes debased. As with banks, weak regulation is a recipe for disaster !

Save the Euro !...expel weak, badly managed countries ....strongly regulate central banks....audit national finances....limit countries national debt....the ECB to agree countries budgets....ignore sovereignty issues !!

DutchCrusader



Joined: 19/05/2008
Posts: 11281

Message Posted:
14/11/2011 11:02

A sudden downfall or regulated demise of the Euro will inevitably lead to the EU breaking up in rich, poor and even poorer countries or groups of countries.

The 5 or 6 strongest countries will keep the NEuro (the rich Northern countries) - the weakest countries most probably will go back to worthless, unreliable and unstable currencies.

Where would the UK be?



The final result in Europe will be isolationism = back to the darkest days and years of the 20th century.

No need to explain that here - check Google and shiver at the thought.

ilovecyprus


Joined: 08/05/2007
Posts: 2880

Message Posted:
14/11/2011 11:08

msge 26



In your second paragraph are you not describing China, who's policy has been to undercut other developing nations, in order that one day, it can create its own prosperous internal market. We in the west have benefited from that in terms, of what we pay at the till. In fact, we could say, that for many of us it has been like receiving a one third increase in our pay cheque. Like the druggy, we have become addicted to those goods, and we have now become indebted to the Chinese.



You are right about the dollar. I would expect the Euro to continue within the Northern European countries, however, if EU countries are going to incestuously trade with each other, there are going to be winners and losers, you need a financial mechanism to deal with this, but you also need the winners to share their prosperity with the losers. This is a stiffer test and Europeans are struggling with this right now. Most peoples identity is centred around their nation state not Europe.

newscoop


Joined: 23/12/2007
Posts: 2197

Message Posted:
14/11/2011 12:08

First time I've ever heard the guardian referred to as 'balanced'



Try the Telegraph.

Geejay


Joined: 18/04/2009
Posts: 475

Message Posted:
14/11/2011 14:41

Quite right Mr Dutch C. As far as the UK is concerned, the UK debt is luckily mostly longer term. And....

compare their 10 year bond rate at 2.266% with Italy..6.314%, Spain..5.799% or even France..3.259, Netherlands..2.321%.

Who then is better placed at the moment to weather this particular storm ? One size fits all only works in socks certainly not economics or finance ! And yes "the weakest countries most probably will go back to worthless, unreliable and unstable currencies."

That's preferable to them bringing everyone else down to their level !

Geejay


Joined: 18/04/2009
Posts: 475

Message Posted:
14/11/2011 14:55

In comparing the UK with the Eurozone, consider this......EC figures show the UK's deficit will be 9.4pc in 2011, 7.8pc in 2012 and 5.8pc in 2013. The debt ratios are 89pc for the UK, 121pc for Italy and 74pc for Spain. Yet Britain's debt is a third cheaper.

Why ?. Because.........Britain's political system is more adept at making tough decisions.

The BoE, through £275bn of quantitative easing, is a big buyer of debt. Unlike the ECB.

Sterling adjusts to the competitive strength or weakness of the economy, whereas Greece, Ireland, Spain and Italy or any others are unable to devalue because they are locked into the unregulated euro.

The Debt Management Office, sees Britain having to borrow £53bn to repay maturing debts next year - compared to 307bn Euros for Italy. That's because the average maturity of Britain's debt is 14 years - whereas Eurozone nations are laden with short-term loans.

That Mr Dutch C is where the UK will be !

davpat


Joined: 23/08/2011
Posts: 225

Message Posted:
14/11/2011 17:38

..........put that in your pipe DC,GJ has spoken!!!

Clarissa2


Joined: 12/06/2009
Posts: 1476

Message Posted:
14/11/2011 18:04

Re: Msg32,



These figures are pointless now, because it was estimated at the time that the UK was slowly on the way to economic recovery.

In fact Britain has never left recession. It can't grow now, because it has effectively already borrowed a decade of growth from the future.

The world is entering a depression, even the emerging markets are slowing down because of the consumer depression exported from Europe and the US.

Unlimited quantitative easing is not the answer either, it didn't help the US - their debt is out of control- only caused more inflation.

newlad



Joined: 02/03/2008
Posts: 7819

Message Posted:
14/11/2011 20:28

http://www.worldbulletin.net/?aType=haber&ArticleID=81612



Strong words indeed,



Paul.

Lemtich



Joined: 15/02/2007
Posts: 1487

Message Posted:
14/11/2011 20:45

The Italian National Bank manages Italy’s gold reserves of 2,451.8 tons. Having this amount of gold, which is valued at about $81.3 billion, makes the Italy the holder of the fourth largest quantity of gold.



What could this do if it was sold to ease for Italian debt. I'm assuming Greece hasn't anything like that amount.

DutchCrusader



Joined: 19/05/2008
Posts: 11281

Message Posted:
14/11/2011 21:03

@ msg 36, Lemtich: (...) Italy the holder of the fourth largest quantity of gold. (...)



▶ And Italy, with all its problems, is still the third biggest economy in Europe. The future isn't that bleak for Italy - Germany, supported by all the smaller rich countries (politically 'independent' but economically just autonomous German 'provinces'), and France will see to it.

rowlo



Joined: 12/10/2008
Posts: 4796

Message Posted:
14/11/2011 21:10

we sold our gold for nothing , the minute uk gold was sold the price quadrupled , who bought the uk gold ? heads should have rolled for selling it , it was a knee jerk reaction , italy has gone the same way as greece , portugal and spain will be next , the gravy train will keep pouring on them , just to win votes for the germans , french , at every eu summit , its as warped as the day is long , rule brittania , thank god we never adopted this cancer .

Clarissa2


Joined: 12/06/2009
Posts: 1476

Message Posted:
14/11/2011 21:35

Re: Msg 36,



I read that Greece still holds quite substantial gold reserve.

They must be hiding it somewhere from the Germans.



Re: Italy

Despite all the drama, Italy is technically solvent on some measures - unlike America or Britain - it has a surplus in its public finances before debt payments. In economic terms it could be described as a short-term liquidity shortfall on its existing liabilities.