HBG

After Cyprus, how can any expat speak up for the Euro, the currency?

One thing bothers me though, the Euro started off at something 88 centimos to the Dollar, and one Pound got you something like 1.70 Euros. One Euro now gets you 1.40 Dollars and 1.18 pounds.

On those small parameters, you can hardly say that it has failed.

BAT7311

british debt is rising at 247 pounds a second .... latvian debt is .... oh they aint got any !!!

BAT7311

so what HAPPENED in cyprus ... who do you know who has lost their money ...
their BANKING sector was MASSIVE with RUSSIAN BLACK ...now those people who avoided paying tax in russia will get it taken in the EU good!!
the vote to take normal savers money got ZERO votes in parliament
also ZOLTY against the EURO drop in last 10 years 4%
POUND aginst the EURO in the last 10 years 26% drop ..

amideislas

The euro is one of the greatest achievements in history. Unfortunately, the very foundation of it is fundamentally flawed, and the rectification of those flaws requires almost total loss of sovereignty for Eurozone members, which was never part of the deal. And support for that notion is slipping away more and more every day.

Next, the structure of the EU is not exactly set up to act as a functional democracy, designed to represent the will of the population. EU leaders are not elected to office and therefore have no specific responsibility to any electorate or constituency.

As you might expect, relinquishing sovereignty to an authority which has no responsibility to any electorate is not particularly palatable to individual member states who currently enjoy some level of democratic rule where their leaders are responsible to their electorate and constituencies. So, a fundamental, far-reaching mass-restructuring of the EU itself will probably be the minimum required to achieve a truly unified "European state".

As the crisis unfolded, EU "leadership" has consistently been in question, and the kind of draconian tactics now being implemented are not particularly encouraging to member states to relinquish sovereignty to the EU.

And that assumes that all of the actors involved are operating openly and without self-interest, which I think you would agree, would be a patently naive view to subscribe to. Trust isn't exactly ubiquitous in the EU.

So, it's not a simple solution or a pretty picture, and at this point I'd seriously question how sustainable it really is. It's certainly not going to get better before it gets better.

jackytoo

Latvia hasn't got any debt....Wait a few years UK may as well keep on borrowing seeing as they can borrow at less than 2%

As for Cyprus, the Russians accounted for only 20% of deposits. Many accounts are business accounts. As one Cypriot showed on TV. He has a pile of cheques to pay in amounting to more than 100,000 and not all profit. Even if the Russians are clobbered, it's not the end of it, just the beginning for the ordinary Cypriot people who are facing rising unemployment and public spending cuts, the same factors which has put Spain on it's knees. Nice to see some of you are pleased

scrubbedexpat095

http://www.bloomberg.com/news/2013-0...ince-2008.html

Having read the above link I must say I don't have too much sympathy for the 'poor' cypriots who have been raking in almost 12% interest for the last 4- 5 years

HBG

Totally logical, nicely put, far too logical for the average European politician. Ambitious Poles, emerging from a long and dark history, blinking in the sunlight of western democracy, are bound to want to get rid of the Zloty.

They, and Latvia, want to trade with the rest of the world and have a lot to offer. They can't trade with their own currencies and need the power of the Euro, which in world terms ranks only slightly behind the mighty Dollar.

But the peoples of Europe have been at war with each other for centuries, and that's the problem. Will the Poles trust Germany? They might prefer them to the Russians, but, by Christ, their recent history must affect them.

I wonder how their referendum will go?

amideislas

Thanks. Well, only time will tell. "Lesser of evils" will be the prevailing wisdom, I reckon. But it appears like they are going at it more through economic extortion than by popular demand, and I find that a bit troubling.

By the way, the Euro isn't strong against the dollar, the Dollar is weak against the Euro (which may sound the same but it's actually very different), largely due to the treasury printing money furiously for some time, which arguably, is at least in part, a reason why their economy is growing instead of shrinking.

HBG

I'm a British expat in Spain, which probably applies to the rest of us. On the question of the Euro, I'm an outsider until I go to the cash point and get what has been bad news for some years now.

Pontificating, the 'brics', the abbreviations are getting too much for me, Brazil, India, China and Russia are powering ahead while Old Europe is falling behind.

When the BRICs look at a map of Europe from afar, they see Spain, Italy, France, Germany and Poland, old Europe, which, even when combined is much smaller than their countries.

I didn't start off to say this, but the UK is off the map.

steviedeluxe

It's true that Europe needs to sell more to the BRICS countries to get out of recession (there are other countries like Turkey and Indonesia too). Luckily Spanish companies have got the message - In January exports soared by 43.8 percent to Asia, 16.6 percent to Africa and 15.1 percent to Latin America
http://www.thelocal.es/page/view/spa...y#.UUwiBVeK3xc
It's from a low base, but if the trend can be continued it augers well for the government prediction that overall growth will resume by year-end.
And if the US economy starts to motor, hopefully it will pull us all out of the ditch.

jackytoo

So why did the bank of Spain say yesterday that growth figures were too high and unemployment would continue to rise above 27% Exports can be making little difference. Just goes from one disaster to another. I see you prefer the Governments optimistic figures!

The Spanish economy will shrink by 1.5 per cent this year and unemployment is set to rise above 27 per cent, the Bank of Spain has predicted.

http://uk.reuters.com/article/2013/0...92Q16I20130327

Dick Dasterdly

Dick Dasterdly

Nuff said.

Domino

Stevie, I am not disagreeing with you but......surely its too little too late.

The companies, as well as the govt, knew full well their local markets were shrinking like plastic in a fire but still did nothing about it.
The lead/lag on exports can be horrendous and companies can and do go bust because they concentrate on the old addage of 80:20 - where 80% of your business/income comes from 20% of your customers.
They became complacent in the easy profits without having to work at it, but you should also be planning to lose 20% of your customers for various reasons every year - so just hope it isnt the 20% that are giving you the 80% or your stuffed

steviedeluxe

You should read a little more carefully before jumping to conclusions. I stated (and we'll see within 10 months the truth or otherwise)

It's from a low base, but if the trend can be continued it augers well for the government prediction that overall growth will resume by year-end.

But it does mean Spain has a future way out of this, if they can continue export growth, and also start to encourage firms to hire again in Spain. Yesterday Renault announced it was taking on 700 new workers

http://www.intereconomia.com/noticia...spana-20130327