I'm pretty positive about the Euro but I thought this was an interesting opinion piece. I don't know that much about economics so I was wondering what others that do think of the idea.
http://www.independent.ie/opinion/columnists/david-mcwilliams/ditching-the-euro-could-boost-our-failing-economy-1729557.html
QuoteDitching the euro could boost our failing economy
By David McWilliams
Wednesday May 06 2009
One of the things about crises is that they tend to blow the credibility of shibboleths out of the water.
A shibboleth is a mantra to which people get attached because it is easier than hard thinking. If enough people repeat the mantra it becomes gospel, and instead of using our heads, we exchange alleged truisms. Ireland's been exposed to enough shibboleths in the past five years to last us a lifetime.
One of these was "property only goes up". The second was "the fundamentals are sound" which, along with "this time it's different", are particularly costly mantras. We also got the "soft landing" shibboleth. Or what about the one last October, "our banks are well-capitalised"?
Well we all know where these mantras have landed us. If you are not aware what is going on in our country and you have access to the internet, have a look at the following clip of the unemployed queuing in Dublin on http://www.youtube.com/watch?v=Cf31q4TC790 Much has been made of this clip already, but it's worth looking at it again.
Yesterday, the 'Frankfurter Allgemeine' ran a story about how Limerick was like the third world, while the influential US magazine the 'Weekly Standard' devoted its front page to our woes at the weekend. Here in Australia, a waitress -- a second generation Irish Aussie -- asked me worriedly this morning: "Is everything okay in Ireland?", having just read a report in 'The Australian'. This was a reasonable question because, with unemployment rising at this level and tax revenue falling, there will come a time, not too far in the future, when Mr Lenihan will cross the corridor to Mr Cowen and tell him that we have "no money to pay the teachers next week".
Make no mistake about it, countries run out of money and if this happens in Ireland you can be sure another mini-Budget will be introduced and the State will expropriate whatever wealth it can to stay afloat.
This is when things get critical, and rather than putting a plan B in place for this event, the State is again clinging to a mantra rather than examining our options.
Anyone with a basic understanding of economics knows that we can't deflate our way to growth. The problem is a lack of demand. People are hoarding money. There is plenty of money in Ireland, but as we are hoarding, this money on deposit doesn't translate into cash spending.
Monetary policy in Ireland is broken. The banks are now too sick to play an active role in refinancing the economy, so therefore the economy continues to contract. As taxes rise, this has the same effect as taking cash out of people's pockets so we spend even less.
On top of this, we face the twin spectre of wages falling at a time when our debt burden is rising. Wages will fall because there are simply so many people on the dole prepared to work for less than their neighbour. The debt burden is rising because so many people who bought houses at the tail end of the boom on low interest rate deals are now facing those "enticement" rates rising.
What can we do about this? The obvious answer is to leave the euro, reinstitute our own currency, allow it to plummet to reflect the real competitive position of our ruined, feeble economy and start again. The vast majority of economists and commentators say this is not possible. In fact, they ridicule those who suggest that this might be worth entertaining.
Let me just remind you that the vast majority of economists and commentators believed the "soft landing" mantra. New ideas go through a cycle. First they and their proponents are ridiculed, then they are violently attacked and only then are they accepted as a universal truth. I suspect the same will happen to the idea of leaving the euro.
There are clearly issues with doing something as radical as this, as it would have to be coincident with a lifting of all state guarantees on interbank lending. The State could still guarantee deposits in the new currency. Many investors who owed the Irish banks or invested in Irish government bonds would get burned. But that is the nature of markets. They would be paid back in the new currency, which would have to find its value.
The new currency would fall rapidly, giving our trading sector a significant boost and making Ireland cheaper overnight for people to do business in. Clearly, the government deficit would have to be addressed through strict spending targets.
As the Central Bank would do what the US, UK, Australia, Canada and Sweden are doing now and print money, the liquidity trap that we are in would evaporate. Clearly inflation would rise rapidly, and the State would need to introduce CPI-linked bonds to refinance itself.
But lots of successful countries have done that in the past -- Sweden, Finland and Israel come to mind.
There are more than enough domestic savings to cover any government short-term shortfalls. In fact, inflation in Iceland, a country which embarked on a similar policy last September, shot up but has now collapsed. Clearly, the Irish banking system that gambled in Euro would be bankrupt. But banks are only institutions and maybe that's no bad thing because it would allow a new bank (or banks) to emerge. The price of land would fall dramatically even in the new currency but would find its level. After this, we could reboot the engine.
Unemployment would fall rapidly as it has done in practically every country which has embarked on such a policy. The Asian Tigers, after their collapse in 1997, are the best example of this rapid re-employment phenomenon. One look at the Asians or the Scandinavians should put paid to arguments about what small open economies can do.
We are already running a trade surplus and we'd run a bigger one. Our deposit base is significant. Clearly lots of money would flee the country initially, but it would come back as the domestic economy recovered quickly. Sure we'd have a lot of explaining to do politically, but we've to do that anyway.
There are other problems in terms of fairness. Young people with debts would benefit, middle-aged people with assets would lose out. But as most of the value of these assets will be wiped out in the grinding recession the next few years will bring, over a five-year period there might be no net change.
Obviously there are many other issues at stake, such as whether investors would re-engage with Ireland after a devaluation. Conventional wisdom says no. But conventional wisdom has been wrong from the start here.
I'll leave you with one example of this. In 1992, conventional wisdom said that if we devalued, the economy would implode, investors would take flight and we'd pay for years. In the event, we were forced to devalue and the economy boomed.
The one thing that scares investors most is a dying asset. No one will touch it. I don't know about you, but I'd prefer to live in a country that gives itself a chance of life, than one where the current policies can only lead to slow strangulation.
QuoteI don't know about you, but I'd prefer to live in a country that gives itself a chance of life, than one where the current policies can only lead to slow strangulation.
I don't see how anyone can disagree with him.
So basically his proposal is to wipe out banks and scare away investors as the best way to avoid this recession, isn't it? Pretty much becoming Iceland Mk II. Or am I missing something here? :unsure:
QuoteMany investors who owed the Irish banks or invested in Irish government bonds would get burned. But that is the nature of markets. They would be paid back in the new currency, which would have to find its value.
Does that work? If an investor lended euro, he would demand to be paid back in euro too, right? :unsure:
QuoteNew ideas go through a cycle. First they and their proponents are ridiculed, then they are violently attacked and only then are they accepted as a universal truth.
That's only true for non-retarded ideas. Not sure if this is one of those.
Quote from: Iormlund on May 06, 2009, 01:25:34 PM
So basically his proposal is to wipe out banks and scare away investors as the best way to avoid this recession, isn't it?
It's far too late to avoid this recession but I think he's arguing that his proposal would help speed up the recovery.
QuotePretty much becoming Iceland Mk II. Or am I missing something here? :unsure:
Does that have to happen? He gives examples of others doing something similar successfully:
QuoteUnemployment would fall rapidly as it has done in practically every country which has embarked on such a policy. The Asian Tigers, after their collapse in 1997, are the best example of this rapid re-employment phenomenon. One look at the Asians or the Scandinavians should put paid to arguments about what small open economies can do.
I'm doing my part for the Irish economy. There's a six pack of Guinness waiting for me at home. :)
I dunno about leaving the Euro as a solution here. I mean, clearly the needs of the Irish or Portuguese economies are different from the French or German, and maybe that merits some sort of localized or targeted strategies. The Germans and French sure as hell aren't going to just go along with deflating the Euro like crazy because Ireland needs it. But then again, federalism is like that. You get in knowing that there are risks and limitations of being in and some things are less flexible than being on your own would be.
Quote from: MadImmortalMan on May 06, 2009, 02:40:18 PM
I'm doing my part for the Irish economy. There's a six pack of Guinness waiting for me at home. :)
:thumbsup: :cheers:
Leaving the Euro is retarded, Ireland would go down the drain faster that Iceland did.
Kevin
The author's missing his own point, accusing banks of "gambling," when he himself admits that there would be no guarantee investors would be willing to re-engage with a rebooted Ireland. Conventional wisdom be damned, a lot of investors would be screwed over and slighted by a sudden withdrawal from the Euro, and if you burn those investors, they will probably not be willing to enter into financial agreements again.
You should rejoin the union :p
Isn't Ireland pretty dependent on the European Union? Before the EU came along, Ireland was pretty much the worst place in the world. Why would they want to screw around with that?
Quote from: DontSayBanana on May 06, 2009, 04:40:47 PM... a sudden withdrawal from the Euro...
Is such a thing even possible? As Sir Humphrey would say: "The ship of State is the only one that leaks from the top".
And the slightest rumor about such plans would trigger an immediate bank run and plunge the country into bankruptcy.
Quote from: Neil on May 06, 2009, 04:48:26 PM
Isn't Ireland pretty dependent on the European Union? Before the EU came along, Ireland was pretty much the worst place in the world. Why would they want to screw around with that?
I live in Dublin (:() and a lot of people I meet put the whole Celtic Tiger thing down almost entirely to their own merit and dismiss EU aid as a footnote.
It's 'funny' to see how everyone here is downplaying EU aid. They built some kind of regional rail system called DART over the past few years and all the billboards say "Partially financed by the EU
(85%)" Please note the difference in font size :D
Kevin
Let me just chime in to say this: the only reason why Ireland hasn't gone bankrupt is because the Irish State guaranteed *every single cent* deposited in all the banks in the country.
This avoided a MASSIVE run on the Irish banks that would have led to instant financial collapse.
BUT Dublin only got away with it because it was in the Euro Area - its moves were done in a very large currency (the euro) and the market knew full well that the ECB and the European Governments would never let a member state of the Euro Area go bust. So, the deposits stayed in place (and Ireland was criticized for this, as in effect it forced many other states to adopt the same policy of ensuring all deposits).
Now, outside the euro, the chances of the Irish State to be able to repay the total sum of money deposited in the country's banks are precisely zero.
That means that all major depositers would try to get their money out of the country and into safer areas ASAP, before all the banks collapse. The Irish economy would last for about three days, tops. After that time period, it would turn into something that would make 1992 Russia look like Heaven on Earth.
Quote from: Eochaid on May 06, 2009, 05:13:31 PM
Quote from: Neil on May 06, 2009, 04:48:26 PM
Isn't Ireland pretty dependent on the European Union? Before the EU came along, Ireland was pretty much the worst place in the world. Why would they want to screw around with that?
I live in Dublin (:() and a lot of people I meet put the whole Celtic Tiger thing down almost entirely to their own merit and dismiss EU aid as a footnote.
It's 'funny' to see how everyone here is downplaying EU aid. They built a some kind of regional rail system called DART over the past few years and all the billboards say "Partially financed by the EU (85%)" Please note the difference in font size :D
Kevin
:lol:
Seriously though, the Irish are offensive to me.
Quote from: Neil on May 06, 2009, 05:27:27 PM
:lol:
Seriously though, the Irish are offensive to me.
Who
isn't? FDR? Grant? Charlemagne? Cicero? :lol:
Quote from: Eochaid on May 06, 2009, 05:13:31 PM
I live in Dublin (:() and a lot of people I meet put the whole Celtic Tiger thing down almost entirely to their own merit and dismiss EU aid as a footnote.
Well that's your experience. What age roughly were most these people? Most people I know are well aware of the help the EU gave Ireland but the EU aid wasn't the only factor in creating the boom. Portugal and Greece got lots of EU aid and as far as I know they didn't experience quite the boom that happened in Ireland.
Quote
It's 'funny' to see how everyone here is downplaying EU aid. They built a some kind of regional rail system called DART over the past few years and all the billboards say "Partially financed by the EU (85%)" Please note the difference in font size :D
Kevin
The DART was built in the early 1980s, hardly a few years ago. I haven't seen the 85% figure before I'll be on the lookout for it next time I use the DART.
On a tangent, the "$$$ Area Rapid Transit" naming convention needs to be drug out and shot. It's just a shame that somebody thought to change the acronym for San Francisco before we got to laugh at "SFART." :P
Quote from: DontSayBanana on May 06, 2009, 05:29:13 PM
Quote from: Neil on May 06, 2009, 05:27:27 PM
:lol:
Seriously though, the Irish are offensive to me.
Who isn't? FDR? Grant? Charlemagne? Cicero? :lol:
Ethnic Albertans. Richard Nixon. Benjamin Disraeli. There are tons of people I don't find offensive. However, few of them are rebels or terrorists.
Quote from: Martim Silva on May 06, 2009, 05:18:43 PM
Let me just chime in to say this: the only reason why Ireland hasn't gone bankrupt is because the Irish State guaranteed *every single cent* deposited in all the banks in the country.
This avoided a MASSIVE run on the Irish banks that would have led to instant financial collapse.
BUT Dublin only got away with it because it was in the Euro Area - its moves were done in a very large currency (the euro) and the market knew full well that the ECB and the European Governments would never let a member state of the Euro Area go bust. So, the deposits stayed in place (and Ireland was criticized for this, as in effect it forced many other states to adopt the same policy of ensuring all deposits).
Now, outside the euro, the chances of the Irish State to be able to repay the total sum of money deposited in the country's banks are precisely zero.
That means that all major depositers would try to get their money out of the country and into safer areas ASAP, before all the banks collapse. The Irish economy would last for about three days, tops. After that time period, it would turn into something that would make 1992 Russia look like Heaven on Earth.
That's interesting, thanks. Yeah I don't see it actually happening. The author is very much in the wilderness on this issue. None of the parties in parliament are calling for us to leave the Euro.
Quote from: Neil on May 06, 2009, 05:39:31 PM
Quote from: DontSayBanana on May 06, 2009, 05:29:13 PM
Quote from: Neil on May 06, 2009, 05:27:27 PM
:lol:
Seriously though, the Irish are offensive to me.
Who isn't? FDR? Grant? Charlemagne? Cicero? :lol:
Ethnic Albertans. Richard Nixon. Benjamin Disraeli. There are tons of people I don't find offensive. However, few of them are rebels or terrorists.
What's an Ethnic Albertan?
Quote from: Cerr on May 06, 2009, 05:46:53 PM
Quote from: Neil on May 06, 2009, 05:39:31 PM
Quote from: DontSayBanana on May 06, 2009, 05:29:13 PM
Quote from: Neil on May 06, 2009, 05:27:27 PM
:lol:
Seriously though, the Irish are offensive to me.
Who isn't? FDR? Grant? Charlemagne? Cicero? :lol:
Ethnic Albertans. Richard Nixon. Benjamin Disraeli. There are tons of people I don't find offensive. However, few of them are rebels or terrorists.
What's an Ethnic Albertan?
Me. People who agree with me.
Quote from: Neil on May 06, 2009, 05:59:27 PM
Quote from: Cerr on May 06, 2009, 05:46:53 PM
Quote from: Neil on May 06, 2009, 05:39:31 PM
Quote from: DontSayBanana on May 06, 2009, 05:29:13 PM
Quote from: Neil on May 06, 2009, 05:27:27 PM
:lol:
Seriously though, the Irish are offensive to me.
Who isn't? FDR? Grant? Charlemagne? Cicero? :lol:
Ethnic Albertans. Richard Nixon. Benjamin Disraeli. There are tons of people I don't find offensive. However, few of them are rebels or terrorists.
What's an Ethnic Albertan?
Me. People who agree with me.
So just you. :lol:
Quote from: Cerr on May 06, 2009, 06:04:16 PM
Quote from: Neil on May 06, 2009, 05:59:27 PM
Quote from: Cerr on May 06, 2009, 05:46:53 PM
Quote from: Neil on May 06, 2009, 05:39:31 PM
Quote from: DontSayBanana on May 06, 2009, 05:29:13 PM
Quote from: Neil on May 06, 2009, 05:27:27 PM
:lol:
Seriously though, the Irish are offensive to me.
Who isn't? FDR? Grant? Charlemagne? Cicero? :lol:
Ethnic Albertans. Richard Nixon. Benjamin Disraeli. There are tons of people I don't find offensive. However, few of them are rebels or terrorists.
What's an Ethnic Albertan?
Me. People who agree with me.
So just you. :lol:
Also: Centrist and conservative white people in Alberta, British Columbia and Saskatchewan.
Just like the Irish to take the money and run <_< :P
Quote from: Cerr on May 06, 2009, 05:36:58 PMMost people I know are well aware of the help the EU gave Ireland but the EU aid wasn't the only factor in creating the boom. Portugal and Greece got lots of EU aid and as far as I know they didn't experience quite the boom that happened in Ireland.
No. There were genuinely local factors such as Ireland speaking English, good education and the low tax rates. But I think the EU aid facilitated the growth of the economy enormously and, more importantly, having a base in Ireland (a low tax, educated, English speaking country) gave access to the Common Market. I think that's the great key of what the EU's done for Ireland and all member states, even Greece and Portugal.
:bleeding: :bleeding: :bleeding:
Let's start by stating some things: first, we live in a world of floating rates, devaluating isn't so easy as it was; second, each bold crusader defending devaluation supposes his country would be the only one doing it and would face no reprisals; last but not least, countries with national currencies can devaluate at will but aren't... clearly, the advantages of devaluation aren't so obvious as they maintain.
Quote
Anyone with a basic understanding of economics knows that we can't deflate our way to growth. The problem is a lack of demand. People are hoarding money. There is plenty of money in Ireland, but as we are hoarding, this money on deposit doesn't translate into cash spending.
Probably, but scrapping the euro woudn't help in this aspect, rather the opposite. Such a move would be guaranteed to cause a big bank run and worse still, as the euro would keep being the currency of some 15 countries, including France, Germany, etc. how many Irish would choose to keep euros hidden under the mattress? I bet most would, since the new currency would fall sharply initially even if it became stable later.
Quote
Monetary policy in Ireland is broken. The banks are now too sick to play an active role in refinancing the economy, so therefore the economy continues to contract. As taxes rise, this has the same effect as taking cash out of people's pockets so we spend even less.
I think the author is mingling (deliberately?) monetary policy - run by ECB and guvmints - and credit policy - run by each bank, there is a flagrant contradiction between 'There is plenty of money in Ireland' and 'The banks are now too sick to play an active role in refinancing the economy'... and of course taxes take cash out of people's pocket; that's what they are supposed to do.
Contraction, IMHO, is not caused by lack of financing. The main reason is fear; demand is weak, very weak, unemployment is soaring, and people are saving money like crazy. No amount of financing, cheap or not, is going to change that in the short run and I'm highly dubious it would in the long run too. We are facing an scenario with inflation near zero... or lower!
Quote
What can we do about this? The obvious answer is to leave the euro, reinstitute our own currency, allow it to plummet to reflect the real competitive position of our ruined, feeble economy and start again. The vast majority of economists and commentators say this is not possible. In fact, they ridicule those who suggest that this might be worth entertaining.
There is no word as dangerous as 'obvious' in the whole dictionary... Just to mention two weak point in the argumentation, devaluation is supposed to be good because it boosts exports and hinders imports, but in a world of falling demand and falling international trade the benefits of devaluating are doubtful; and many of your biggest commercial partners are going to be royally pissed off... which is not a great idea when you are in your last gasps.
Quote
Let me just remind you that the vast majority of economists and commentators believed the "soft landing" mantra. New ideas go through a cycle. First they and their proponents are ridiculed, then they are violently attacked and only then are they accepted as a universal truth. I suspect the same will happen to the idea of leaving the euro.
Cheap, demagogic, and false. Many new ideas are ridiculed; a few level up to being violently attacked; fewer still survive to be accepted as universal truths. Every good idea has something new, but not every new idea has something good!
Quote
But lots of successful countries have done that in the past -- Sweden, Finland and Israel come to mind.
Meaningless. Many countries have devaluated in the past; some were successful, some weren't.
Quote
There are more than enough domestic savings to cover any government short-term shortfalls. In fact, inflation in Iceland, a country which embarked on a similar policy last September, shot up but has now collapsed. Clearly, the Irish banking system that gambled in Euro would be bankrupt. But banks are only institutions and maybe that's no bad thing because it would allow a new bank (or banks) to emerge. The price of land would fall dramatically even in the new currency but would find its level. After this, we could reboot the engine.
Great, just great. Soaring inflation, falling land and housing prices, an Icelandish economic collapse, ruined banks all aorund (but hey, banks are only institutions!) and government somehow securing domestic savings to cover 'short-term shortfalls'. Now about the bad part...
Quote
Unemployment would fall rapidly as it has done in practically every country which has embarked on such a policy. The Asian Tigers, after their collapse in 1997, are the best example of this rapid re-employment phenomenon. One look at the Asians or the Scandinavians should put paid to arguments about what small open economies can do.
That's building castles in the air. In the late 90s countries could rely on the rest of the world absorbing their exports. Who's going to do that today?
I could go on, and on, and on...
Quote from: Cerr on May 06, 2009, 05:36:58 PMWell that's your experience. What age roughly were most these people? Most people I know are well aware of the help the EU gave Ireland but the EU aid wasn't the only factor in creating the boom. Portugal and Greece got lots of EU aid and as far as I know they didn't experience quite the boom that happened in Ireland.
This is, of course, my personal experience. Most Irish people I know are 25-35yo. The older people are, the readier they are to recognise the importance of EU aid.
Having said that, Eu aid helped of course, but there are a number of other factors that played. In nor particular order:
- English-speaking country (and proximity to London where a lot of companies had their European HQ)
- Qualified, litterate and hard-working workforce.
- Irish gvt incentives.
- Cheap country (back the anyway :D)
QuoteThe DART was built in the early 1980s, hardly a few years ago. I haven't seen the 85% figure before I'll be on the lookout for it next time I use the DART.
I don't take the DART a lot (I live in the Liberties), but I know of at least two stations where I saw that info, including Connolly Station (on your right-hand side when northbound).
You could find the same kind of signs at LUAS stations as well until about a year ago.
Kevin
Quote from: Cerr on May 06, 2009, 05:46:53 PM
What's an Ethnic Albertan?
Dene. Black Foot. Cree. :contract:
Surely the Irish people won't mind, that their import will costs a lot more. Who needs gasoline and other import products? Because that is an inevitable consequence of leaving the euro. Their Irish pound will drop a lot.
This sounds like something a Texas Secessionist would write. 'We wud be so much better without the darn gubmint'
Quote from: Valmy on May 07, 2009, 08:06:32 AM
This sounds like something a Texas Secessionist would write. 'We wud be so much better without the darn gubmint'
Continuing the proud Irish tradition of leaving mighty empires to become backwater hicks.
[conspiracy theorist]
OMG! I KNEW IT!
Teh plan is for Ireland to leave the EU then Lisbon can be passed then the EU can be a nation and steel aal our freeeeedomz and then for Ireland ot join again they'll have to accept Lisbon first!!!1111
[/conspiracy theorist]
But seriously....Ireland leaving would be interesting as far as Lisbon and the future of the EU goes....
Quote from: Faeelin on May 07, 2009, 08:25:42 AM
Quote from: Valmy on May 07, 2009, 08:06:32 AM
This sounds like something a Texas Secessionist would write. 'We wud be so much better without the darn gubmint'
Continuing the proud Irish tradition of leaving mighty empires to become backwater hicks.
:rolleyes:
Quote from: Valmy on May 07, 2009, 08:06:32 AM
This sounds like something a Texas Secessionist would write. 'We wud be so much better without the darn gubmint'
Eh to be fair to the writer, he's not arguing to leave the EU just the Euro currency.
Quote from: Cerr on May 07, 2009, 08:52:54 AM
Eh to be fair to the writer, he's not arguing to leave the EU just the Euro.
It is the same sort of arguement...that things could be run better when you do not have to consider the interests of the rest of Union. I find that thinking false, it may work out in the short term but in the long run it is best if the economic and monatary system is managed with the interests of the whole Union in mind.
Quote from: Valmy on May 07, 2009, 08:55:08 AM
Quote from: Cerr on May 07, 2009, 08:52:54 AM
Eh to be fair to the writer, he's not arguing to leave the EU just the Euro.
It is the same sort of arguement...that things could be run better when you do not have to consider the interests of the rest of Union. I find that thinking false, it may work out in the short term but in the long run it is best if the economic and monatary system is managed with the interests of the whole Union in mind.
I wonder if this is so. Are the European economies similar enough that having one currency is viable?
Quote from: Faeelin on May 07, 2009, 09:02:49 AM
I wonder if this is so. Are the European economics similar enough that having one currency is viable?
They are tightly integrated to the point one currency is not just viable it is almost a necessity.
Quote from: Faeelin on May 07, 2009, 08:25:42 AM
Quote from: Valmy on May 07, 2009, 08:06:32 AM
This sounds like something a Texas Secessionist would write. 'We wud be so much better without the darn gubmint'
Continuing the proud Irish tradition of leaving mighty empires to become backwater hicks.
Let's be fair. Most of Ireland's people were always backwater hicks, even before they committed treason.
Quote from: Faeelin on May 07, 2009, 09:02:49 AMI wonder if this is so. Are the European economies similar enough that having one currency is viable?
That was the question from the very beginning. In the last ten years it was obviously viable. If it stays so in the future remains to be seen.
But then, what is an optimal size for an economy with one currency? We have economies like the United States, China and the Eurozone on the one hand and we have smallish countries with just millions or hundreds of thousands of inhabitants with their own currency. The bigger currency areas have considerable differences in their economies too. Do Michigan, New York, Texas, California and Hawaii have a similar economy? First is built on automobile industry, second is built on finances, third is built on high-tech and oil, fourth is built on high-tech and agriculture and fifth is built on tourism. Yet, they all have the same currency and it is doubtful they have the same economic cycles. Michigan was already bad off when the rest was still booming for example.
Quote from: Zanza2 on May 07, 2009, 10:33:42 AM
But then, what is an optimal size for an economy with one currency? We have economies like the United States, China and the Eurozone on the one hand and we have smallish countries with just millions or hundreds of thousands of inhabitants with their own currency. The bigger currency areas have considerable differences in their economies too. Do Michigan, New York, Texas, California and Hawaii have a similar economy? First is built on automobile industry, second is built on finances, third is built on high-tech and oil, fourth is built on high-tech and agriculture and fifth is built on tourism. Yet, they all have the same currency and it is doubtful they have the same economic cycles. Michigan was already bad off when the rest was still booming for example.
I could not agree more.
Quote from: Cerr on May 07, 2009, 08:52:54 AM
Quote from: Valmy on May 07, 2009, 08:06:32 AM
This sounds like something a Texas Secessionist would write. 'We wud be so much better without the darn gubmint'
Eh to be fair to the writer, he's not arguing to leave the EU just the Euro currency.
Rick Perry would sound just as insane if he argued that Texas should leave the dollar instead of complete secession.
Irish are not europeans.
Quote from: Siege on May 07, 2009, 09:43:39 PM
Irish are not europeans.
Fantastically incorrect. You could argue that they're a bunch of rebels and traitors who should all be hanged, but they're definitely European.
Quote from: Siege on May 07, 2009, 09:43:39 PM
Irish are not europeans.
In what possible sense are they not Euros?
Quote from: Valmy on May 08, 2009, 08:29:14 AM
In what possible sense are they not Euros?
(https://languish.org/forums/proxy.php?request=http%3A%2F%2Fwww.vatican.va%2Fnews_services%2Fpress%2Fimg%2Fss_scv%2Feuro%2Feuro_foto.jpg&hash=6dff19dca2cbd0daabe7cefdc16c25f467f1b384)
I've never seen an Irishman (or anyone for that matter) that was so hard and shiny.
Quote from: garbon on May 08, 2009, 12:46:12 PM
I've never seen an Irishman (or anyone for that matter) that was so hard and shiny.
See I was using Euros there as a shortening of Europeans...you know what we have only been doing on this board for six years now?
Quote from: Valmy on May 08, 2009, 12:55:41 PM
See I was using Euros there as a shortening of Europeans...you know what we have only been doing on this board for six years now?
You said "In what possible sense" :P