The Eurozone does not allow for the necessary economic adjustments across nations in a fiat monetary system.
The Eurozone does not publicly recognize that there are large disagreements over what economic policy should be.
If a single monetary policy for
the Eurozone does not work, how much less the world as a whole?
As @Bregalad already commented, leaving
the Eurozone does not imply leaving the EU.
The solution in the eurozone doesn't have to be a full - blown United States of the Eurozone but if it is to be successful it is likely to include most of the mechanisms that make other currencies work in countries such as the UK and the US:
The eurozone does not have a single Pan-European government bond similar to United States Treasuries.
«In truth he would have agreed to let
the Eurozone do what it wanted as long as the UK was not involved, while believing the course of action extremely unwise.»
Not exact matches
A large share of Italian debt issued under domestic legislation
does not have any contract terms and is regulated by an Italian law that gives the Italian Treasury ample latitude to restructure the debt... The composition of Italian public, however, is changing rapidly because in January 2013,
Eurozone members started issuing bonds with standardized contract terms.
He tells broadcasters that if
eurozone leaders don't address the crisis properly we will see a meltdown as soon as later this month.
Renzi has pledged to resign if the tally doesn't go his way, and the Five Stars Movement, which wants Italy out of the
eurozone, stands waiting to exploit the situation.
Still, most analysts don't believe that the greatest fears — a currency collapse, a major sovereign default, a banking meltdown or the dissolution of the
eurozone monetary bloc — will come to pass.
Note we
do see inflation moving sideways at low levels in the
eurozone, even as we expect inflation to pick up in the U.S..
Growth in the
Eurozone has
done the same.
While U.S. economic data has not given the dollar much reason to extend gains, data from the
Eurozone has surely not
done the euro any favors.
But he also called on
eurozone governments, as he has often
done, to
do their part to stimulate the economy by taking measures to raise productivity and by making changes to improve the business environment.
This stems from the fact that they
do not have a clear grasp on how the
Eurozone market even works.
I'm optimistic that the crisis will be serious enough to break up the
eurozone and create a new, more socialist order in which debts are written down — and with them, the «bad savings» of the financial elites that are seeking to
do to Europe what the Roman Empire
did when it reduced Western Europe to feudalism.
Central banks in Japan and
eurozone have already
done that.
Bottom line: We believe a modestly higher USD ahead supports the case for favoring
eurozone and Japanese equities, and it
does not change our preference for EM stocks.
Just because there is a rule stipulating that QE program purchases of sovereign bonds be in relation to GDP, the ECB has and will continue to
do «whatever it takes» in order to prevent peripheral
Eurozone bond yields from blowing out to near - reality levels.
Positives touched most aspects of the economy, including some powerful improvements to America's competitiveness which probably explain why the U.S. has
done pretty well in 2012 in spite of the
Eurozone mess, China's slowdown and the fiscal cliff episode.
But the improvement in the
eurozone's fortunes
does pose a dilemma for the ECB in our view, all the more so given that renewed expectations for the Fed to raise rates soon have been helping to depress the euro.
She's also calling for a government takeover of the French central bank (which is currently an independent entity that doesn't print money for the Treasury) and the creation of a currency system like the one previously used across the
eurozone.
Eurozone officials are unanimous that it means a commitment to financial war against labor — to austerity and yet further economic shrinkage; to faster privatization selloffs (but not to Russians if they offer higher prices, as Gazprom
did) and hence higher prices for hitherto public utilities; to no rejection of past insider privatization deals to higher value - added taxes on consumers; and to lower pensions for labor.
But it also suggests to me that we're likely to continue to have easy monetary policy for some time to come in the
eurozone, and building on what the ECB has already
done, and I'd also expect it to
do more in the future.
The ECB
did announce that it was extending its policy of providing liquidity to
EUROZONE banks at extremely low rates for a period of 12 and 13 months in an effort to prevent any immediate bank run.
FRA: Given these political developments,
do you see Germany continuing to bear the debt of the rest of Europe in terms of transferring its current account surplus to the less fortunate states of the union... or could it be that Germany considers on leaving the
Eurozone?
You know on the one hand if a country leaves the
Eurozone, and not like Britain
did but like an actual country that's located directly in it like Italy or France, then the whole thing blows up because suddenly the credit markets go because at that point the credit rating for the European Union is different.
The
eurozone took it on the chin economically in 2014, and many analysts don't expect 2015 to bring a significant respite to the region.
For example, we
do not cover the EU budget, which has no macroeconomic relevance for the
eurozone, and which is over-covered in all national newspapers anyway.
I think countries within the
eurozone also should lift some of their controls to allow their economies to be freer, which would encourage growth, because Europe doesn't have a high - growth potential at the moment.
A key sign: Prices for government bonds of other heavily indebted
eurozone countries — such as Spain and Italy — are not suffering in sync with Greek bonds, as they
did before.
Overall, I don't think QE will be good for the
eurozone currency, and I think the euro will probably lose value in the wake of this plan over time.
It could
do it, for example, by selling its assets, by deregulating and liberalizing its economy to revive totally uncompetitive exports (Greece is the least competitive economy in the
Eurozone), or by reforming its pension system, which costs 17.5 % of the GDP, while the average pension expenditures in the
Eurozone amount to the 13.8 % of the GDP.
If the
Eurozone leadership was sincere in helping Greece they shouldn't have exacerbated and prolonged the crisis by making insincere statements like Greece
does not need aid and their media should not have slandered the Greek and their culture.
However, if Syriza representatives end up reneging on their promises and
do not get nearly as much
done, I think it will probably mean that we could see a continued drop in the polls for some extremist parties throughout the
eurozone.
I think improvement in the
eurozone economy in the 11 months since the current QE program was announced is one of the reasons why Draghi and his ECB governing council colleagues were reluctant to
do more.
So, ahead of a critical two - day summit in which Europe's leaders will come up with a plan to solve the
eurozone crisis, the pressure will be on him to tackle the issue in a way which doesn't compromise his own party's fractured views.
Existing
Eurozone institutions need to
do whatever necessary to maintain stability, and I welcome the ECB interventions through its Securities Markets Programme this week to
do just that.
While it is quite true that some of the shackles on growth are outside of the control of domestic economic policy, such as the continuing
eurozone crisis and imported inflation, government
does have a role to create the best possible environment for businesses to thrive and grow.
A combination of these factors most likely come into play, but it is certainly true that the UK
does not suffer from the same nervousness that accompanies the bond auctions of some
eurozone nations, and that is something we would want to avoid.
Finally, the UK will be allowed to enact «an emergency safeguard» to protect the City of London, to stop UK firms being forced to relocate to Europe, and to ensure British businesses
do not face «discrimination» for being outside the
Eurozone.
Of course, one thing that I think we can all agree on is that a resolution of the
eurozone crisis would
do more than anything else to give the UK economy a boost.
And secondly, our position on the
eurozone crisis: what needs to be
done, what might actually happen, and how we see Britain's interests.
Parties of the radical left
did well in the crisis - hit southern states of the
Eurozone and in Ireland.
Cameron has already conceded he is open to the idea of a referendum on Britain's continuing membership of the EU, but is insisting the move
does not take place until the
eurozone crisis has been resolved.
... What I want David Cameron to
do is to protect our economy, protect our jobs - mainly, because that's the thing that's under most threat from the
Eurozone - protect the City of London, but he needs to help them get a solution to the
Eurozone crisis so that the entire European economy doesn't fall apart.
Given that the Prime Minister described the main topic of debate as «instability in the
eurozone», one could have predicted Eurosceptic members would turn up in force - as indeed they
did.
If the Euro doesn't break up next year, the effects of the
Eurozone crisis will bring recession to Britain - the storm.
It is a very, very dangerous time... What we have seen is the inability of political leaders in the
eurozone to put short - term politics aside and
do what's right.