Euro zone cries out to ECB for QE.
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The Man from DelMonte can say no too, but if the ECB doesnt then it is the end of the Euro because those countries under pressure will leave the euro in order to deflate a currency they then control. Not that such deflation is bad. The UK, US, Swiss have done this already. All the ECB needs to do is follow step to fix the ecconomic problems in the Euro zone, and thus assuage the fear gripping the worlds markets. With France clamouring for it, Germany will listen. :)
============================== Nothing to say.
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The Man from DelMonte can say no too, but if the ECB doesnt then it is the end of the Euro because those countries under pressure will leave the euro in order to deflate a currency they then control. Not that such deflation is bad. The UK, US, Swiss have done this already. All the ECB needs to do is follow step to fix the ecconomic problems in the Euro zone, and thus assuage the fear gripping the worlds markets. With France clamouring for it, Germany will listen. :)
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Erudite_Eric wrote:
The Man from DelMonte can say no too
With a gap of just under 2 percentage points between French and German 10 year bonds, France could be in trouble at some future time, however, as commented by me in another place, Spain's 10 year bonds at 6.975% is fractionally below the 7% mark that caused other EuroZone members to seek help. So Spain looks to be next pretty damned soon. However, the politics of EuroZone members countries do not move as fast as the economic misery that could engulf even more countries, yet, the ECB does not have a mandate to act on QE, and for such a mandate to be written into a treaty would require the unanimous agreement of EuroZone national governments, albeit via some sort of referendum at national levels, before such a EuroZone directed treaty (law if you wish) could be enacted. Thus the politics is too slow. It is, in a manner of speak, akin to Nero fiddling while Rome burns. The attribute of Thatcher - the lady is not for turning - could equally apply to the German Chancellor.
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Erudite_Eric wrote:
The Man from DelMonte can say no too
With a gap of just under 2 percentage points between French and German 10 year bonds, France could be in trouble at some future time, however, as commented by me in another place, Spain's 10 year bonds at 6.975% is fractionally below the 7% mark that caused other EuroZone members to seek help. So Spain looks to be next pretty damned soon. However, the politics of EuroZone members countries do not move as fast as the economic misery that could engulf even more countries, yet, the ECB does not have a mandate to act on QE, and for such a mandate to be written into a treaty would require the unanimous agreement of EuroZone national governments, albeit via some sort of referendum at national levels, before such a EuroZone directed treaty (law if you wish) could be enacted. Thus the politics is too slow. It is, in a manner of speak, akin to Nero fiddling while Rome burns. The attribute of Thatcher - the lady is not for turning - could equally apply to the German Chancellor.
Richard A. Abbott wrote:
the ECB does not have a mandate to act on QE
If they dont it means Greece, Italy, Spain, Portugal possibly Ireland, leaving the Euro. So it ends up being a French/German and Benelux currency. How seriously then will the world take it, and what happens to it when all those countries that hold it as foreign exchange dump it for CHF, USD or £? It is going to devalue anyway. A lot. So the ECB has a choice, QE now and save the Euro, and the pain, or not, and almost destroy the Euro and cause more pain. As for politics, and hohw slow it moves in Europe, the Germans effectively got rid of Papadapamouse and Berlesconi in a matter of a week or so. I am sure the ECB can do what the hell it likes if it has public support, even without a mandate.
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Richard A. Abbott wrote:
the ECB does not have a mandate to act on QE
If they dont it means Greece, Italy, Spain, Portugal possibly Ireland, leaving the Euro. So it ends up being a French/German and Benelux currency. How seriously then will the world take it, and what happens to it when all those countries that hold it as foreign exchange dump it for CHF, USD or £? It is going to devalue anyway. A lot. So the ECB has a choice, QE now and save the Euro, and the pain, or not, and almost destroy the Euro and cause more pain. As for politics, and hohw slow it moves in Europe, the Germans effectively got rid of Papadapamouse and Berlesconi in a matter of a week or so. I am sure the ECB can do what the hell it likes if it has public support, even without a mandate.
============================== Nothing to say.
Erudite_Eric wrote:
I am sure the ECB can do what the hell it likes if it has public support, even without a mandate.
No. They must be seen to apply the law without fear or favour.
Erudite_Eric wrote:
Germans effectively got rid of Papadapamouse and Berlesconi
Yep, those two are no longer in power. Yet the peoples of the various EuroZone countries might be required to authorise any new treaties or updates to existing treaties according to their national law. Thus a change of people at the top of national politics does not presume consent by the nation's electorate to any new/updated treaty.
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Erudite_Eric wrote:
I am sure the ECB can do what the hell it likes if it has public support, even without a mandate.
No. They must be seen to apply the law without fear or favour.
Erudite_Eric wrote:
Germans effectively got rid of Papadapamouse and Berlesconi
Yep, those two are no longer in power. Yet the peoples of the various EuroZone countries might be required to authorise any new treaties or updates to existing treaties according to their national law. Thus a change of people at the top of national politics does not presume consent by the nation's electorate to any new/updated treaty.
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The Man from DelMonte can say no too, but if the ECB doesnt then it is the end of the Euro because those countries under pressure will leave the euro in order to deflate a currency they then control. Not that such deflation is bad. The UK, US, Swiss have done this already. All the ECB needs to do is follow step to fix the ecconomic problems in the Euro zone, and thus assuage the fear gripping the worlds markets. With France clamouring for it, Germany will listen. :)
============================== Nothing to say.
Erudite_Eric wrote:
The Man from DelMonte
Is that like the Man of La Mancha[^]? ;P
If your actions inspire others to dream more, learn more, do more and become more, you are a leader." - John Quincy Adams
You must accept one of two basic premises: Either we are alone in the universe, or we are not alone in the universe. And either way, the implications are staggering” - Wernher von Braun -
Richard A. Abbott wrote:
the ECB does not have a mandate to act on QE
If they dont it means Greece, Italy, Spain, Portugal possibly Ireland, leaving the Euro. So it ends up being a French/German and Benelux currency. How seriously then will the world take it, and what happens to it when all those countries that hold it as foreign exchange dump it for CHF, USD or £? It is going to devalue anyway. A lot. So the ECB has a choice, QE now and save the Euro, and the pain, or not, and almost destroy the Euro and cause more pain. As for politics, and hohw slow it moves in Europe, the Germans effectively got rid of Papadapamouse and Berlesconi in a matter of a week or so. I am sure the ECB can do what the hell it likes if it has public support, even without a mandate.
============================== Nothing to say.
Erudite_Eric wrote:
save the Euro
Why save it? Going back to national currencies seems a better way to me.
If your actions inspire others to dream more, learn more, do more and become more, you are a leader." - John Quincy Adams
You must accept one of two basic premises: Either we are alone in the universe, or we are not alone in the universe. And either way, the implications are staggering” - Wernher von Braun -
Erudite_Eric wrote:
save the Euro
Why save it? Going back to national currencies seems a better way to me.
If your actions inspire others to dream more, learn more, do more and become more, you are a leader." - John Quincy Adams
You must accept one of two basic premises: Either we are alone in the universe, or we are not alone in the universe. And either way, the implications are staggering” - Wernher von Braun -
ahmed zahmed wrote:
Why save it?
Alternative to the dollar is the main reason.
============================== Nothing to say.
And?
If your actions inspire others to dream more, learn more, do more and become more, you are a leader." - John Quincy Adams
You must accept one of two basic premises: Either we are alone in the universe, or we are not alone in the universe. And either way, the implications are staggering” - Wernher von Braun -
Erudite_Eric wrote:
save the Euro
Why save it? Going back to national currencies seems a better way to me.
If your actions inspire others to dream more, learn more, do more and become more, you are a leader." - John Quincy Adams
You must accept one of two basic premises: Either we are alone in the universe, or we are not alone in the universe. And either way, the implications are staggering” - Wernher von BraunReturning to national currencies are attractive for a number of reasons including the ability to manipulate a national currency by the nation's central bank. However, just like an army, you are more powerful, less fragmented, and singing from the same music sheet as a collective than if you were an individual currency. The problem is that all countries that make up the EuroZone are not equals and this creates the kind of distortion you see in Ireland, Portugal, Greece, Italy and now Spain. One size does not fit all, and that is simply the reason why this experiment should not be considered a success.
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And?
If your actions inspire others to dream more, learn more, do more and become more, you are a leader." - John Quincy Adams
You must accept one of two basic premises: Either we are alone in the universe, or we are not alone in the universe. And either way, the implications are staggering” - Wernher von Braun -
Erudite_Eric wrote:
The Man from DelMonte
Is that like the Man of La Mancha[^]? ;P
If your actions inspire others to dream more, learn more, do more and become more, you are a leader." - John Quincy Adams
You must accept one of two basic premises: Either we are alone in the universe, or we are not alone in the universe. And either way, the implications are staggering” - Wernher von Braun -
Returning to national currencies are attractive for a number of reasons including the ability to manipulate a national currency by the nation's central bank. However, just like an army, you are more powerful, less fragmented, and singing from the same music sheet as a collective than if you were an individual currency. The problem is that all countries that make up the EuroZone are not equals and this creates the kind of distortion you see in Ireland, Portugal, Greece, Italy and now Spain. One size does not fit all, and that is simply the reason why this experiment should not be considered a success.
Thanks for making my points. I agree with you and hence my statement that it would be better for those countries that make up the Eurozone return to their own national currencies.
If your actions inspire others to dream more, learn more, do more and become more, you are a leader." - John Quincy Adams
You must accept one of two basic premises: Either we are alone in the universe, or we are not alone in the universe. And either way, the implications are staggering” - Wernher von Braun