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The "little Englanders" were right all along....
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The single currency is a complete disaster so will all those nose in the air "superior" Europhiles now come clean and own up to being wrong? Come on I'll go easy!
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well I was really thinking of the main problem of countries almost collapsing financially because they are locked into a system they have no control over. Although I don't agree with the idea I would have been a lot happier if they'd have done it properly instead of putting the cart before the horse in a sort of political b4stardisation.
Makes you wonder how the 50 states of the US manage with a single currency, doesn't it? There must have been states in economic crisis but for the central government supporting them. Federalism, complete with centrally agreed taxation and economic policy of all member states, is, or was, the EU dream.
Being a Europhile does not include believing that we should have the same currency. There were some benefits attached to having it; Germany and France would not have wanted it otherwise; but the risks outweighed the benefits to us.
Being a Europhile does not include believing that we should have the same currency. There were some benefits attached to having it; Germany and France would not have wanted it otherwise; but the risks outweighed the benefits to us.
The reasons the 50 States of the USA manage with a single currency, Fred, is quite simple. Here are just a few of them:
- They form a single sovereign state with one government.
- They have one set of fiscal rules which are adhered to so that their economies are “pooled”. This means that there is only one deficit or surplus for the nation and not individual ones for California, Texas, New York, etc.
-The purchasing power of the Dollar is not state-dependent (although there are geographical variations as there are in most countries).
- The interest rates and exchange rates are not determined so as to suit one or two states whilst being completely unsuitable for the remainder.
- Prices, productivity and competitiveness do not exhibit wide variations which are particular to one state of group of states.
- Most importantly the US$ was set up under a single government and set of rules for the benefit of the nation as a whole, and not cobbled together as a ego trip for a few politicians who had no regard for the people and who pressed ahead despite being warned that the latest scenario was a very strong possibility.
Certainly Germany and France recognised the benefits (to them) of establishing the Euro. It was quite simple: lend the peripheral nations huge sums, the likes of which they could only dream of before the single currency, at ridiculously low and very attractive interest rates, and encourage them to use the cash to buy your goods and services. Simples! The only problem was that none of the stupid gullible politicians of the borrowing nations could see beyond their noses (or in reality the next election) to realise that one day those debts would fall due for repayment.
The Euro is being kept on a life support machine by the stronger nations, in particular Germany, because the prospect of its collapse (which is now virtually inevitable) will lose them all the advantages they saw for themselves before the set up. The only question that remains is whether the end will be painful, very painful or excruciating and the longer the life support machine is left plugged in the more painful and prolonged the end will be.
- They form a single sovereign state with one government.
- They have one set of fiscal rules which are adhered to so that their economies are “pooled”. This means that there is only one deficit or surplus for the nation and not individual ones for California, Texas, New York, etc.
-The purchasing power of the Dollar is not state-dependent (although there are geographical variations as there are in most countries).
- The interest rates and exchange rates are not determined so as to suit one or two states whilst being completely unsuitable for the remainder.
- Prices, productivity and competitiveness do not exhibit wide variations which are particular to one state of group of states.
- Most importantly the US$ was set up under a single government and set of rules for the benefit of the nation as a whole, and not cobbled together as a ego trip for a few politicians who had no regard for the people and who pressed ahead despite being warned that the latest scenario was a very strong possibility.
Certainly Germany and France recognised the benefits (to them) of establishing the Euro. It was quite simple: lend the peripheral nations huge sums, the likes of which they could only dream of before the single currency, at ridiculously low and very attractive interest rates, and encourage them to use the cash to buy your goods and services. Simples! The only problem was that none of the stupid gullible politicians of the borrowing nations could see beyond their noses (or in reality the next election) to realise that one day those debts would fall due for repayment.
The Euro is being kept on a life support machine by the stronger nations, in particular Germany, because the prospect of its collapse (which is now virtually inevitable) will lose them all the advantages they saw for themselves before the set up. The only question that remains is whether the end will be painful, very painful or excruciating and the longer the life support machine is left plugged in the more painful and prolonged the end will be.
It's not so much the single currency that has been the problem but the excessive flexibilty of the way the rules around it have been implemented.
In order to have been allowd to join there were certain financial rules regarding borrowing and the like that nations were meant to achieve and stick to.
Problem was that some people were so keen to make it as wide a project as possible that the rules were completely bent.
Particularly in the case of Italy I think they only achieved the criteria for about a week and it was "Hey come on in!"
Perhaps if we'd been more involved in the projectthere could have been an Anglo-German wing dictating proper observance of the rules and things might have been different - but there was't the political interest here - not because many people thought there wasfinancial instability but rather because of a rather silly patriotic emotional attachment.
As I recall at the time there was a lot of sillly stuff revolving more about whether the Queen's head would be done away with rather than any sensible discussion about fiscal discipline.
Unfortunately whenever Europe comes into the equation too many people stop using their brains in their hurry to jump up and salute the flag!
In order to have been allowd to join there were certain financial rules regarding borrowing and the like that nations were meant to achieve and stick to.
Problem was that some people were so keen to make it as wide a project as possible that the rules were completely bent.
Particularly in the case of Italy I think they only achieved the criteria for about a week and it was "Hey come on in!"
Perhaps if we'd been more involved in the projectthere could have been an Anglo-German wing dictating proper observance of the rules and things might have been different - but there was't the political interest here - not because many people thought there wasfinancial instability but rather because of a rather silly patriotic emotional attachment.
As I recall at the time there was a lot of sillly stuff revolving more about whether the Queen's head would be done away with rather than any sensible discussion about fiscal discipline.
Unfortunately whenever Europe comes into the equation too many people stop using their brains in their hurry to jump up and salute the flag!
Not much sign of a collapse in rural France. Everyone is getting on with their lives, the only ones who are suffering are Brit expats whose pensions shrank thanks to tony and gordon who managed to devalue the pound against the euro by 25%. It is a storm in teacup/demitasse, still the little Englanders can dream.
Well jomifl I think "Tony and Gordon" fully intended to devalue the pound - I don't think there was much "managed" about it.
In doing so they made UK exports more competetive with Europe and saved an awful lot of people's jobs.
Last November Osbourne said:
"Printing money is the last resort of desperate governments when all other policies have failed."
Then in Feb this year he authorised anothe £50 Billion of QE !
So if there is blame or credit I think it crosses party lines.
Of course you can't make an omlette without breaking eggs and Pensioners have suffered more than most in this recession
QE has dropped the value of the annuities they can buy, interest rates are at all time lows and Gorgous George hit them with a "Granny tax"
Still at least the 50% tax band has gone - that should help those of them with 6 figure incomes stretch them a little further
In doing so they made UK exports more competetive with Europe and saved an awful lot of people's jobs.
Last November Osbourne said:
"Printing money is the last resort of desperate governments when all other policies have failed."
Then in Feb this year he authorised anothe £50 Billion of QE !
So if there is blame or credit I think it crosses party lines.
Of course you can't make an omlette without breaking eggs and Pensioners have suffered more than most in this recession
QE has dropped the value of the annuities they can buy, interest rates are at all time lows and Gorgous George hit them with a "Granny tax"
Still at least the 50% tax band has gone - that should help those of them with 6 figure incomes stretch them a little further
New Judge, yes, do you know, I suspected as much about the US, LOL
The single currency can only work well when the economies and fiscal policies of the individual states are centrally controlled and directed, as in the US , with only minor local matters in the hands of the states themselves. The present EU controls are not as effective as that.
The single currency can only work well when the economies and fiscal policies of the individual states are centrally controlled and directed, as in the US , with only minor local matters in the hands of the states themselves. The present EU controls are not as effective as that.
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One rather minor correction to New Judge's description of currency here in the U.S.... Each individual State is required to have a budget for which they are individually responsible. The telling factor, however, is that each State's Constitution (as opposed to the Natinoal Constitution) requires that the budget be balanced. In other words, unlike our Federal government, the States cannot run an arrears... they can only spend that which they take in.
If only our Federal government were required to do the same, we (actually our grand-children) wouldn't be faced with paying off a $15 Trillion debt (that's nearly $500 Million per day). By 2016 our debt will exceed our GNP and we'll all learn to speak Greek.
If only our Federal government were required to do the same, we (actually our grand-children) wouldn't be faced with paying off a $15 Trillion debt (that's nearly $500 Million per day). By 2016 our debt will exceed our GNP and we'll all learn to speak Greek.
Thanks for the info, Clanad.
Of course we have a similar situation here in the UK with local authorities and their budgets, but I accept that is slightly different.
Although you may like to learn to speak Greek when your nation's debt reaches the levels you describe, there is one crucial difference between the US and the hapless nations on the periphery of the Eurozone. You and your compatriots may already be aware, so forgive me if I’m telling you something you already know, that in two countries in Europe the elected Prime Ministers have been supplanted by unelected European Community “technocrats”. These were appointed because it was felt (by the EC) that the elected incumbents were somewhat less receptive to the tight fiscal conditions the EC placed on those nations needing help. In the case of Greece it was even suggested (and speedily rejected, thankfully) that the Greek elections, due early next month, be postponed for twelve months to “ensure stability”.
I’m sure that something like that would not have been proposed in the US !!!
Of course we have a similar situation here in the UK with local authorities and their budgets, but I accept that is slightly different.
Although you may like to learn to speak Greek when your nation's debt reaches the levels you describe, there is one crucial difference between the US and the hapless nations on the periphery of the Eurozone. You and your compatriots may already be aware, so forgive me if I’m telling you something you already know, that in two countries in Europe the elected Prime Ministers have been supplanted by unelected European Community “technocrats”. These were appointed because it was felt (by the EC) that the elected incumbents were somewhat less receptive to the tight fiscal conditions the EC placed on those nations needing help. In the case of Greece it was even suggested (and speedily rejected, thankfully) that the Greek elections, due early next month, be postponed for twelve months to “ensure stability”.
I’m sure that something like that would not have been proposed in the US !!!
I said months ago Greece would not fall (while 99% of the press claimed otherwise) as if you look into the ideology of the EU, the plan to unite Europe gradually and totally is so great that nothing will be allowed to stop it. So rather than allow the Greeks their freedom to control their own economy and sort things out using local interest and currency rates they are quite happy to sacrifice the welfare of the Greek people (and the Spanish next) in order to keep their plan on track.
In fact, with Britain now calling for full fiscal union as well as the others, you could say if they wanted it before but the people didn't, by letting in some lame ducks guaranteed to default as their requirements were known to be insufficient to join, when it hit the fan sooner or later then that very solution would be offered, and accepted as it now will be. A pretty well engineered plan considering the citizens unanimously took their eyes off the ball and continued voting to stay in whenever they had a chance not to. I hope the countries who did will now be fully aware of the unnecessary pain they have caused themselves (with far more to follow) as they have plenty of our cash stored up to glue this situation together and make sure the local rules get replaced by more and more central ones. It's all they ever wanted and this false flag operation was the means to get it.
In fact, with Britain now calling for full fiscal union as well as the others, you could say if they wanted it before but the people didn't, by letting in some lame ducks guaranteed to default as their requirements were known to be insufficient to join, when it hit the fan sooner or later then that very solution would be offered, and accepted as it now will be. A pretty well engineered plan considering the citizens unanimously took their eyes off the ball and continued voting to stay in whenever they had a chance not to. I hope the countries who did will now be fully aware of the unnecessary pain they have caused themselves (with far more to follow) as they have plenty of our cash stored up to glue this situation together and make sure the local rules get replaced by more and more central ones. It's all they ever wanted and this false flag operation was the means to get it.
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