One of the reasons the monetary union is in a financial mess, is that some countries have concealed the extent of their sovereign deficit.
Italy in particular had huge debts and the government debt criterion would have kept Italy outside the euro.
The disparity between the highly efficient German economy and the less productive parts of Europe would always create an economic gulf.
For the French, monetary union was as much about politics, about the balance of power within Europe, as about economics.
If the Euro fails, or we bail it out at a hugely prohibitive cost, we will be paying for it for years to come. Euro Survival is essential.
Euro survival will be costly, Euro failure would be catastrophic.
Was it fiscal permissiveness that allowed countries, like Greece, to fiddle their euro membership criteria to such an over-inflated extent?.
All this easy money fuelled a frenzied property boom, especially in Spain and Ireland. A small Street in Dublin is one example of this lethal bubble.
The introduction of the euro as a single currency in Europe, before Europe had become a federation was a poorly conceived idea.
David Marsh “The common vision was to have a single currency, from the Atlantic, maybe to the Urals, that in some magical way would do everything.”
The continued crisis in the eurozone was only getting worse. The property markets in Spain and Ireland collapsed as the economy went from boom to bust.
Now, when banks can’t borrow, they can’t land and, in the worst-case, they find it hard to repay their debts and they go bust. The eurozone was facing a full-scale, potentially devastating, banking crisis.
You know the economy is in trouble when a €1 trillion loan is considered little more than a sticking-plaster for the banking crisis.
By injecting €1 trillion into failing European banks, the ECB was putting an enormous sticking plaster on the haemorrhaging eurozone. But even the ECB admits that the loans do no more than by time for a proper cure to be found.
The Great Euro Crash - Where did ALL the Money Go? For more than two years, Europe’s economies have been on the edge of a financial economic precipice.
The dream of European harmony and stability was ill-considered with drastic consequences.
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