The Ministry of Finances in Berlin has denied reports about a return to the D-Mark and the symptoms of disintegration in the current Eurozone...
The reason for the reports are the recommendations to the effect that the economic tensions between the member states of the European monetary union could be balanced through the re-introduction of national currencies.
Scenarios concerning an abandonment of the Euro were drawn up by the Scientific Research Service of the German Parliament already in April 2005.
The following June, the Italian Labor and Social Minister called for a referendum on the return to the Lira, and initiating an Italian policy of interest rates in order to stave off the threat of bankruptcy.
The German Minister of the Economy, Wolfgang Clement, also complains of the uniform interest regulations of the Euro system, which are leading to a generalized paralysis.
A French analyses, at the disposal of german-foreign-policy.com, recommends the re-introduction of national currencies, while maintaining a mutated Euro.
Several German retailers are already displaying their wares with double price tags in two currencies...
The weakness of the currency reflects the crises in several of the Eurozone states, suffering under loss of revenue, growing debts and continued strangulation of private consumption...
The consequences (unemployment and reduction in real income) are particularly affecting Germany, the Netherlands, Italy and Portugal. Formerly these countries used national currency strategies, increasing or lowering the rate of interest and printing more money, whereas today they succumb to the monetary objectives of the ECB.
The Frankfurt Institute has committed itself to an inflation margin of no more than 2 Percent and thus blocks any compensation measures for dealing with the crisis.
The crash of the monetary union is a real danger, if reform measures are not taken - in Italy through the re-introduction of the Lira. Other observers remark, that Italy could only gain by leaving the Euro zone, introducing a new Lira (NLI) and exposing it to a devaluation of about 20 percent.
...German and French Economists are doubting that the monetary union can be sustained.
The authors [4] view the Euro as chronically overrated and therefore incapable of prevailing in the international competition against the dollar.
The return to national minting alone would signal an end of the dysfunction in the EU, according to the brochure. In order to avoid the abrupt termination of the circulation of the Euro, the new, national currencies, yet to be created, and the European Central Bank's creation should 'co-exist'.
The authors warn that in the case of the continuation of the current ECB system, social revolts are to be anticipated. The referendum to the Constitutional Treaty May 29, in France gave a foretaste of what can be expected...
[1] European Meltdown? Europe fiddles as Rome burns. HSBC Global Research, London/Düsseldorf, Juli 2005. HSBC ist in Deutschland u.a. bei Trinkaus und Burghardt (Düsseldorf) vertreten.
[4] Pierre Leconte und Edouard Husson: Quel avenir pour l'euro? Zirkular, 22.06.2005
How is this old news from unreliable sources going to stop the severe recession gripping the UK?
Re: Bad news on the euro Vol. 94
August 11 2005, 9:56 AM
Explain 'recession' to us again ?
"Slow growth", wasn't it?
LOL!
Euro is becoming a superstar
August 13 2005, 3:29 AM
From a reputable source:
Look what it says Tony. ITALY IS OUT OF RECESSION and talk of the dissolution of EMU is out of the minds of traders. Of course your allies, the "outside looking in" pseudo-economists will continue to preach tired old news concerning the demise of euro. But the world has faith in the euro.
The Wall Street Journal today predicted the dollar will erase all of its gains this year by the end of this year as Russia, China, the new EU countries, the nations of the middle east and more continue to accelerate their purchase of euros at the expense of dollars. The high oil prices which promise to rise even higher are accelerating US deficits to new heights; heights foreign investors view as unsustainable.
New elections in Germany and Italy that are upcoming will assure new business oriented governments that are very pro-euro will take the helm. The euro is assured a very healthy and long life.
The euro is becoming a superstar quickly. The unpegging of the Chinese Yuan from the dollar and China increasing their share of euros is propelling the euro and the eurozone to new heights of economic power.
Yes, Tony you and your allies, who are definitely on the outside looking in and being ignored by those in power are making sure the euro overcomes its challenges and shows no mercy to those that get in its way.
The Euro screamed higher today thanks to stronger growth in Italy. GDP grew by 0.7%, which is the strongest pace of growth since 2001. This indicates that Italy, the Eurozone's weak link has finally come out of recession. This is extremely positive for a region whose resurgence in growth is capturing the market's attention. Sentiment in the Euro has improved significantly over the past few weeks as the single currency benefits from not only improving economic conditions but also increased diversification of reserves into Euros. These are both long-term factors that should continue to support the EURUSD. For the time being, talk of EMU dissolution is completely out of the minds of traders.
re (Daniel Jackson): "Yes, Tony you and your allies, who are definitely on the outside looking in..."
REPLY: Thank goodness!
Re: Bad news on the euro Vol. 94
August 13 2005, 5:08 PM
Being on the outside looking in isn't something to be thankful for. It means you have no say in the decisions being made concerning the future of the euro. These fringe groups you link yourself with might get a warm fuzzy feeling printing articles on their "never viewed by anyone of importance" websites, but the people making the decisions concerning the euro pay no attention to people like you. Thus everything you post here is just wishful thinking by your allies but not even close to ever happening. Isn't that a kick in the pants?
I just keep wondering what type of propaganda the anti-euroists are going to come up with now that they can't claim the euro is ruining the Italian economy since the economy is out of recession and growing. The German economy is doing well too with a strong confidence for the future. In fact the entire eurozone is starting to boom. That is because these countries have introduced reforms to produce growth and it is working. Only a dead head would think a currency is at fault.
The strange thing is that the UK economy is in a recession and it doesn't look like things will get better soon. Thanks to the Chinese unpegging the euro from the dollar and nations worldwide are diversifying out of dollars, the euro is the currency of choice for their diversification. Yes tony it is the euro they want.
Can you explain why the New York markets consider the euro and the yen as the only currencies of importance in the world economy? Why is it that on the yahoo finance page (and elsewhere), the euro and the yen have a separate listing and the pound is grouped in with the less important currencies of Canada, Australia, Switzerland, etc.? Shouldn't the pound be up their either with the euro or above it? I'm not understanding why New York snubs the pound.