easy: TWO SETS OF BOOKS.
Seriously, the Eurostat which is responsible for EUecconomy statistics has been caught up in two major book fixing scandals.
The euro is being inflated by the USA intentially in order to impose a "poor mans" tarriff on EU governments subsidizing their goods and services. WTO does not allow a tarriff, but it does allow for a good old fashioned currency manipulation.
"The euro is being inflated by the USA intentially in order to impose a "poor mans" tarriff on EU governments subsidizing their goods and services. WTO does not allow a tarriff, but it does allow for a good old fashioned currency manipulation."
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I can't speak to the USA purposely manipulating the euro since this is the first time I've heard such a theory but I think the euro is trading high against the dollar because the EU is being tight with their currency. This has placed them into a deflationary hole that further exacerbates an already bad situation. Here's more from Kudlow on that very issue:
http://www.townhall.com/columnists/larrykudlow/lk20041115.shtml
More Kudlow:
"For now, the real problem with the dollar is not so much that the Fed is too loose, but much more that the euro is way too tight. Just as with foreign policy, Old Europe has the monetary story wrong. The creation of new euros is way too stingy; it is in fact still deflationary.
Consequently, Eurozone economic growth has averaged a recessionary 1 percent in recent years, whereas the U.S. recovery rate has been 3.5 percent. America lowered tax rates, but the Europeans refused to do so. Top-heavy social spending and excessive regulating of business and labor markets also suppress Eurozone growth. In comparison with the U.S., not only does Europe not work, not produce, and not invest -- with terrible productivity to boot -- their monetary policy is scorched-earth deflationary. Old Europe has dug itself into a deflationary hole."