I don't know if this will add much to the discussion, but I think something like the first option was really always the end state that was envisioned by the European project: union economically, fiscally and politically. I think that it was felt that a common currency would be a good lead-in to that.
As has been pointed out many times, there are both cultural and basic political obstacles that have not been overcome, and that can't be just papered over or hand-waved away.
It's a pity, frankly, but any such unification will probably be a result of a slower evolution that reduces the barriers more naturally, if, in fact, it happens at all.
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1. If you want to keep one single € zone as is exists today, then it mandatory requires a mone
y flow from the rich(er) regions to the poorer regions. This is also the case in the USA, where some
states need to pay for the other states.
While there is a single € zone and a € trade zone with free movement of capital and people,
the mindset (as correctly analysis in the previous view) is not yet generally accepted and people
tend to not want to pay for the party of the other..
From a macro economic point of view, it is difficult to have such a big region, with significant
cultural differences (aka put a Fin and a Greek together... and watch) and a single monetary
instrument... policy makers have never thought this one true completely...
While there are many advantages of a single euro zone, there are disadvantages
people tend to quickly forget and want + but no -
2. In case the hole chapter of europe and the euro needs to be un-done, there will be a lot of
financial issues. Who pays for what ? Unless this happens at the moment of a complete meltdown
of the system, at which point it does no longer matter...
3. Feet on the ground, i think in the current context, the fact to create 60B euro per month, just
out of thin air, with no reasonable sign of any improvement for the euro zone, this will simply
just back fire... only i haven't found a way to monetize it yet...
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Option 2 was not properly explained. Devaluation requires reintroducing a local currency. The Euro should not be treated as a holy cow.
Today the European Union is made up of 28 member countries. 19 have introduced the Euro. 9 countries have so far kept their local currency. Out of the 9 countries, 3 of them (UK, Denmark and Sweden) have voted against the introduction of the Euro. Poland, the Czech Republic, Hungary, Bulgaria and Croatia are not interested in introducing the Euro.
This shows that there are two groups of countries who wish to keep their currencies
-> Scandinavian countries / UK
-> Eastern European countries with the exception of the Baltic states, Slovakia and Slovenia
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And there in lies the rub. As bob says, the Fiscal etc. union is a long term project, but who knows if it will ever happen.
I think it is smarter to wait for that and then join in. Smart move for the countries who have not taken up the Euro offer. More independence and being more in tune with their country's fiscal policies.
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Nobody in Germany likes the "Soros Option" - that Germany leaves the Euro.
Because Germany has benefitted the most by far from its introduction.
Because Germans as a whole work harder & more efficiently to produce better designed products of higher quality that consumers want.
Normally within the capitalist model, this strength would lead to an increased valuation of their currency, giving their trading partners within the EU a better chance of competing. But since the Eurozone was created, Germany has been superior and economically crushed its partners, helped by further enormous interest rate imbalance in the form of, for example, the Greeks being able to borrow a the same rate as the Germans (impossible without the same currency).
So, berating the Greeks and others whilst stuffing in their bratwurst and downing their delicious Bavarian beer, they have benefitted enormously... and who lent the Greeks all that money they were never going to be able to pay back : oh, my goodness, the Germans (mostly).
So, dear Angela (Merkel), stop whining about paying for everybody else, a situation in whose creation you played a, if not the, major part, get real & write off the debt, leave the Euro to give every one else in the Eurozone a chance to slowly regain economic health (it won't happen otherwise) and clear up the mess and suffering you have caused with your foolish, if well-intentioned, "open doors policy" to the refugees (who cannot be blamed for flooding across Europe to get there).
A different point of view (from someone who drives & appreciates German cars... and Ninjascript coders ).
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FAR more... but the Dutch are indeed pretty darned sneaky, the way they handle so many non-EU corporations' business within Europe, ie. they help them avoid EU taxes.
I'm Scottish, btw - we just had a near-miss with the referendum : had Scotland left the UK & joined the Eurozone, with its calculations for fiscal balance based on $110 oil, we'd now be heading for bankruptcy... then you Germans could have bailed us out as well
Wait a minute ! If Germany leaves the Eurozone, who's going to bail everyone else out ?
No, no - we didn't mean it, you are essential to the Eurozone !
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