Debts, promises and the erosion of democracy | 423 comments (422 topical, 1 editorial, 0 hidden)

Re: Debts, promises and the erosion of democracy (none / 0)

I'm not entirely sure about radically higher German inflation being necessary, even if it would be helpful (especially for Sweden...). Periphery nations can get out of the "big closed economy"-mindset and start competing with nations outside the Eurozone. However, the people who should be clamoring the most for higher German inflation is German workers, who haven't had any pay increases for a decade.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Mon Feb 20th, 2012 at 01:19:36 PM EST
[ Parent ]

Re: Debts, promises and the erosion of democracy (none / 0)

No, they can't start competing with nations outside the Eurozone. Floating exchange rate, remember?

Nor is it desirable for them to do so.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Feb 20th, 2012 at 02:31:41 PM EST
[ Parent ]

Re: Debts, promises and the erosion of democracy (none / 0)

I fail to see how Greece becoming competitive with non-EZ countries would strengthen the Euro so much that the newly gained competitiveness would be lost.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Mon Feb 20th, 2012 at 02:47:42 PM EST
[ Parent ]

Re: Debts, promises and the erosion of democracy (none / 1)

Because that's the point of floating the currency: To make sure that the external account takes care of itself.

With the external account in balance (as it must be unless you want to argue that the ECBuBa is going to start printing Euro in bulk to buy dollars and Yuan?), and Germany attempting to run a surplus, there must be a deficit somewhere else in the Eurozone.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Feb 20th, 2012 at 02:52:22 PM EST
[ Parent ]

Re: Debts, promises and the erosion of democracy (4.00 / 2)

It's like the Archimedes principle for fluids. Size doesn't matter - the floating exchange rate will do the trick. It then becomes a question of intra-EU competition, and I don't know about you but I'd like the EU to be an area of cooperation, not of cutthroat races to the bottom (we've seen how well that has worked over the past 15 years).

tens of millions of people stand to see their lives ruined because the bureaucrats at the ECB don't understand introductory economics -- Dean Baker

by Carrie (migeru at eurotrib dot com) on Mon Feb 20th, 2012 at 03:16:39 PM EST
[ Parent ]

Debts, promises and the erosion of democracy | 423 comments (422 topical, 1 editorial, 0 hidden)

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