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Martin Wolf on the eurozone's intolerable choices

In his FT column, Martin Wolf becomes extremely gloomy about the future of the eurozone. In economic terms, he calls it a modern version of the classic gold standard. If external financing dries up, adjustment would have to happen through "internal devaluation", a euphemism for a depression. He concludes that the role of the banks is central. The eurozone needs to have a central treasury-backed banking system for the eurozone to survive.

My own formulation:
basically, the ECB likes to pretend that issuing fiat Euros is as difficult as shitting gold ingots


Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Wed Jun 1st, 2011 at 05:08:01 AM EST
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