Actually in the current situation, we are in a very strong possition and very attractive for investors to dump their money into our currency.
Break up of the euro imminant.
- Thread starter Bon
- Start date
Watch out for what you wish for
Surely a strong £ means weakened attractiveness for export? The very thing that our government is hanging its hat on for our 'continued' recovery.
As to whether or not Germany and France should or should not bail out Greece/Italy, it is the very presence of these economies in the EU over the last 10 years that has kept the currency exchange rates enjoyed by Germany and France to be relatively low valued in a world sense and therefore kept them exporting in a way that they could not out of the Euro (the Mark and Franc would have strengthened and exports reduced accordingly).
So Germany, and to a lesser extent France (the two major economies in the Eurozone) have benefitted from sucking in the minnows of southern europe and can count, in not a small way, their current strength as a direct result of the make up of the Eurozone.
Conversely of course, Greece, Ireland, Portugal, Spain have all been able to benefit from interest rates only previously available to Germany and France - this being the direct cause of the reckless borrowing that they were tempted into.
So should they share the pain? A bit, at least, I would say as the reality is that the only way that the Euro can really work is Federal control of borrowing and therefore collective responsibility for Eurozone debt (so they would have shared that pain anyway). They should have set up a central bank in the firts place, controlled their members more tightly and perhaps they wouldnt be in this mess.
I too am glad we never went into the Euro. I recall with some mirth a great deal of argument for it because it would be easier to go on holidays and not have to change our money up. Well its more expensive now for sure but at least we can sit outside the problem to a degree
But coming back to watching what you wish for - if they fail and their economies go under - then we are for it anyway, we'll all be back in a very severe recession that will threaten the world economy. Sounds like fun eh?
Surely a strong £ means weakened attractiveness for export? The very thing that our government is hanging its hat on for our 'continued' recovery.
As to whether or not Germany and France should or should not bail out Greece/Italy, it is the very presence of these economies in the EU over the last 10 years that has kept the currency exchange rates enjoyed by Germany and France to be relatively low valued in a world sense and therefore kept them exporting in a way that they could not out of the Euro (the Mark and Franc would have strengthened and exports reduced accordingly).
So Germany, and to a lesser extent France (the two major economies in the Eurozone) have benefitted from sucking in the minnows of southern europe and can count, in not a small way, their current strength as a direct result of the make up of the Eurozone.
Conversely of course, Greece, Ireland, Portugal, Spain have all been able to benefit from interest rates only previously available to Germany and France - this being the direct cause of the reckless borrowing that they were tempted into.
So should they share the pain? A bit, at least, I would say as the reality is that the only way that the Euro can really work is Federal control of borrowing and therefore collective responsibility for Eurozone debt (so they would have shared that pain anyway). They should have set up a central bank in the firts place, controlled their members more tightly and perhaps they wouldnt be in this mess.
I too am glad we never went into the Euro. I recall with some mirth a great deal of argument for it because it would be easier to go on holidays and not have to change our money up. Well its more expensive now for sure but at least we can sit outside the problem to a degree
But coming back to watching what you wish for - if they fail and their economies go under - then we are for it anyway, we'll all be back in a very severe recession that will threaten the world economy. Sounds like fun eh?
Not sure if this is legal mods (?), but I would recommend the blog site http://hat4uk.wordpress.com/.
This guy appears to know what he is talking about and have his finger on the pulse. I love reading his daily rants ...
This guy appears to know what he is talking about and have his finger on the pulse. I love reading his daily rants ...
Leaving the Euro aside for a minute the problem is that most people seem to have forgotten why the European union was first founded. Following the first world war Germany was bankrupted due to the war reperations they were forced to repay, particularly by France. This caused the rapid rise of the National Socialist party and ultimately the Second world war.
Following WW2 it was agreed that this mustn't be allowed to happen again and the European Union was formed as, basically, a trade association to protect the interests of European countries, promote prosperity and stability.
There are some apparant daft decisions that have been made but believe me they were made for good reason and there's a lot more to these than appears on the surface. Take the straight bananas debate. This was done to protect European importers and distributers from American imports. The countries they grew and imported from had straighter bananas so it was a no brainer.
We have enjoyed a lot of support from the EU over the years and talk of allowing it to fail puts us at real risk of extremist groups rising and causing real problems in the future.
Following WW2 it was agreed that this mustn't be allowed to happen again and the European Union was formed as, basically, a trade association to protect the interests of European countries, promote prosperity and stability.
There are some apparant daft decisions that have been made but believe me they were made for good reason and there's a lot more to these than appears on the surface. Take the straight bananas debate. This was done to protect European importers and distributers from American imports. The countries they grew and imported from had straighter bananas so it was a no brainer.
We have enjoyed a lot of support from the EU over the years and talk of allowing it to fail puts us at real risk of extremist groups rising and causing real problems in the future.
EU or UN?
Not getting confused with the United Nations are we? The common market had nothing to do with insuring against the rise of a right wing Europe and everything to do with lowering trade barriers.
Not getting confused with the United Nations are we? The common market had nothing to do with insuring against the rise of a right wing Europe and everything to do with lowering trade barriers.
Mark,
I mean the European Union. The Common Market is only one of the '3 pillars' of the EU. All are aimed at co-operation and avoiding a repeat of past events.
JJ
Sorry, I understand where you are coming from now, though would say that any of those initial thoughts of restricting member states taste for war (inter-European at least) has now long since passed (thank heavens) and it is now about promoting common interests - judicial and economic.
Therefore any breakup of the Union will not increase the liklihood of another Liebensraum type agenda from any states.
All things said and done, they'll stick together one way or another and I suspect it will be a more Federal Europe - because that is the only way it will work (and then ultimately fail for good in a few generations).
Therefore any breakup of the Union will not increase the liklihood of another Liebensraum type agenda from any states.
All things said and done, they'll stick together one way or another and I suspect it will be a more Federal Europe - because that is the only way it will work (and then ultimately fail for good in a few generations).
Really? Interesting point of view although obviously you refer to political and economic manoeuvrings rather than military (which was the thrust of that point)
Perhaps you have seen the Belgian army mustering on Germany's border?