Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
You're forgetting the interest rate environment the 1:1 conversion, and all that FDR public debt from the ill-advised conversion and the massive public investment, caused.

Remember, even if these were pre-Euro days, everyone wanting in was in the ERM, and central banks were forced to pursue policies which kept their currencies within an accepted band versus other currencies. So when the Buba raised interest rates, everyone in the currency band raised interest rates. (Well, not everyone - sterling famously didn't, got massively devalued despite Major's chancellor of the exch pissed away billions of taxpayers money in reserves in defence of the pound, making George Soros a richer man in the process.)

This interest rate environment and the resulting strong currencies (the franc was trading at roughly the same as the imputed franc is now) killed off investment and really killed exports. Unemployment rates were 13% in France (and double that in Marseille) as a result; this is why I ended up in the US.

Not saying it wasn't in principle the right thing to do, if of course poorly executed. Just saying it is not at all accurate to say the rest of us didn't pay a steep price for German unification and the Germam's unilaterally decided-upon course of political, economic and monetary policy which resulted.

The Hun is always either at your throat or at your feet. Winston Churchill

by r------ on Tue Sep 11th, 2007 at 03:21:22 PM EST
[ Parent ]

Others have rated this comment as follows:


Occasional Series