Is the end nigh for the Euro? [vol. 2]
Discussion
Mermaid said:
Steffan said:
..
The experiment has failed totally economically, financially and politically.
Not all experiments work, and there is learning in this for other groups of countries that are not politically/culturally the same of what not to do. And I expect there will be a successor version (not that this is pronounced dead yet) that may well work.The experiment has failed totally economically, financially and politically.
Some may say Germany unsuccessful, again - it seems for the moment.
The EU is not sunk yet. But I rather think that the water is rising rapidly.
The clear differences that should always have been apparent between Southern Europe and Northern Europe in lifestyle and critically economic and fiscal choices were always apparent. Yet never, ever discussed or addressed in any way.
That was the fundamental error.
None of the HBAT's could ever trade at the economic levels enjoyed by Germany. The mechanism of destruction was the EU itself. It could never work.
The game of bluff has lasted very well. But it was always doomed. Just very well hidden.
Steffan said:
The clear differences that should always have been apparent between Southern Europe and Northern Europe in lifestyle and critically economic and fiscal choices were always apparent. Yet never, ever discussed or addressed in any way.
That was the fundamental error.
Was it Kipling who got it right?That was the fundamental error.
Mermaid said:
Not all experiments work, and there is learning in this for other groups of countries that are not politically/culturally the same of what not to do.
Hmm, I have been thinking that the EU and the Eurozone is an attempt at a form of multiculturalism.Much as the UK claims to be so now.
The problem is that those at the top mainly only interact with others at the top.
If the EU had been left to those who only wanted to harmonise technical standards and trading regulations, without political interference, the current mess might have been avoided.
Looking a little further ahead ....
There are a few indications that osme in Germany are getting worried that their energy supplies may soon be very compromised. Having shut the Nuclear power stations they need to build replacement units quickly - but can they and what fuels should they use? The Greens would probably object to anything but wind and they already struggle with that.
Like here the only immediate 'fix' is to exteed the lives of the older coal fired stations by tearing up the EU rules that require they be shut by 2016. Even if that is politically accepted the plant is old, not too efficient and will have had minimal investment for years. Not an ideal starting point for a critical 'keep the lights on' plan.
Now that may mean that running an energy intensive business in Germany could become very uneconomic and/or very erratic. Some major German companies may feel that they are better off investing time and effort and cash building up their plants in other places - the USA and China for example - since they can then manufacture more efficiently for a high proportion of their sales and simply import a portion of that output for the 'home' market.
Add that to the economic load that everyone seems to be expecting Germany to take on to support the EZ and things could get decidedly interesting quite rapidly.
There are a few indications that osme in Germany are getting worried that their energy supplies may soon be very compromised. Having shut the Nuclear power stations they need to build replacement units quickly - but can they and what fuels should they use? The Greens would probably object to anything but wind and they already struggle with that.
Like here the only immediate 'fix' is to exteed the lives of the older coal fired stations by tearing up the EU rules that require they be shut by 2016. Even if that is politically accepted the plant is old, not too efficient and will have had minimal investment for years. Not an ideal starting point for a critical 'keep the lights on' plan.
Now that may mean that running an energy intensive business in Germany could become very uneconomic and/or very erratic. Some major German companies may feel that they are better off investing time and effort and cash building up their plants in other places - the USA and China for example - since they can then manufacture more efficiently for a high proportion of their sales and simply import a portion of that output for the 'home' market.
Add that to the economic load that everyone seems to be expecting Germany to take on to support the EZ and things could get decidedly interesting quite rapidly.
WhoseGeneration said:
Hmm, I have been thinking that the EU and the Eurozone is an attempt at a form of multiculturalism.
Much as the UK claims to be so now.
The problem is that those at the top mainly only interact with others at the top.
If the EU had been left to those who only wanted to harmonise technical standards and trading regulations, without political interference, the current mess might have been avoided.
Nobody only wanted to harmonise trading regulations and technical standards though - it's always been about federalism.Much as the UK claims to be so now.
The problem is that those at the top mainly only interact with others at the top.
If the EU had been left to those who only wanted to harmonise technical standards and trading regulations, without political interference, the current mess might have been avoided.
k can be sorted?Interesting article from Robert Peston. I understand not everyone likes his pronouncements but this is worth a look I think. A lot of background colour contained therein on the EU troubles.
See http://www.bbc.co.uk/news/business-18088540
This does seem to me to be a structural deficiency and not a quick fix problem. I do not see how the Euro can really continue as a single currency union and the EU continue as a community unless Fiscal unity and true Economic parity is at least the objective.
There cannot be an effective free for all or this simply will not work. Which, clearly is what has been wrong up till now. If the countries are not, at least, on a convergent economic footing, there cannot be a converged value currency.
One is simply impossible without the other, long term.
On balance I do not think the EU can achieve this. Therefore I am becoming increasingly doubtful about the future of the EU itself, let alone the HBAT's. They are dead in the water.
I recognise that the EU has huge wealth and influence at its disposal. What it can do, at a cost of Trillions of Euro's, is to create delay and obfuscation very effectively. But that will not solve any of the problems inherent in these difficulties.
Which is why I see real trouble coming for the EU.
Sadly, despite all Cameron's rhetoric that will be very harmful to the economy of the UK.
"Things are NOT going to get better" could be this years political hit.
See http://www.bbc.co.uk/news/business-18088540
This does seem to me to be a structural deficiency and not a quick fix problem. I do not see how the Euro can really continue as a single currency union and the EU continue as a community unless Fiscal unity and true Economic parity is at least the objective.
There cannot be an effective free for all or this simply will not work. Which, clearly is what has been wrong up till now. If the countries are not, at least, on a convergent economic footing, there cannot be a converged value currency.
One is simply impossible without the other, long term.
On balance I do not think the EU can achieve this. Therefore I am becoming increasingly doubtful about the future of the EU itself, let alone the HBAT's. They are dead in the water.
I recognise that the EU has huge wealth and influence at its disposal. What it can do, at a cost of Trillions of Euro's, is to create delay and obfuscation very effectively. But that will not solve any of the problems inherent in these difficulties.
Which is why I see real trouble coming for the EU.
Sadly, despite all Cameron's rhetoric that will be very harmful to the economy of the UK.
"Things are NOT going to get better" could be this years political hit.
Steffan said:
at a cost of Trillions of Euro's,
We've become used to talking about billions and trillions of whatever currency but what we need to remember is that, if those are figures are of debt, that represents future labour from someone.Seems to me there's a lot of future labour already mortgaged, let alone adding to it.
WhoseGeneration said:
We've become used to talking about billions and trillions of whatever currency but what we need to remember is that, if those are figures are of debt, that represents future labour from someone.
Seems to me there's a lot of future labour already mortgaged, let alone adding to it.
That's the old way. The new way is that those debts will be inflated away come the next boom...Seems to me there's a lot of future labour already mortgaged, let alone adding to it.
davepoth said:
WhoseGeneration said:
We've become used to talking about billions and trillions of whatever currency but what we need to remember is that, if those are figures are of debt, that represents future labour from someone.
Seems to me there's a lot of future labour already mortgaged, let alone adding to it.
That's the old way. The new way is that those debts will be inflated away come the next boom...Seems to me there's a lot of future labour already mortgaged, let alone adding to it.
WhoseGeneration said:
Ain't going to be another boom in the West, that's what the politicians know and have been told.
Why?, no way to inflate wages.
The principal driver to inflation is raw materials costs. As demand increases globally, the price of raw materials will rise, causing an increase in inflation. The boom doesn't actually have to be here for the inflation to occur.Why?, no way to inflate wages.
davepoth said:
WhoseGeneration said:
Ain't going to be another boom in the West, that's what the politicians know and have been told.
Why?, no way to inflate wages.
The principal driver to inflation is raw materials costs. As demand increases globally, the price of raw materials will rise, causing an increase in inflation. The boom doesn't actually have to be here for the inflation to occur.Why?, no way to inflate wages.
Mermaid said:
Steffan said:
..
The experiment has failed totally economically, financially and politically.
Not all experiments work, The experiment has failed totally economically, financially and politically.
I think you've rather got to say "didn't give the expected result" in this case.
davepoth said:
WhoseGeneration said:
Ain't going to be another boom in the West, that's what the politicians know and have been told.
Why?, no way to inflate wages.
The principal driver to inflation is raw materials costs. As demand increases globally, the price of raw materials will rise, causing an increase in inflation. The boom doesn't actually have to be here for the inflation to occur.Why?, no way to inflate wages.
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