Posted on 06/03/2005 3:05:36 PM PDT by Cornpone
AMSTERDAM — Doom scenarios about the future of the euro are being heard in France and the Netherlands after both nations rejected the EU Constitution in recent referendums.
The president of the Dutch reserve bank DNB, Nout Wellink, has dismissed the speculation as "nonsense", while German Finance Minister Hans Eichel claims such talk is "irresponsible".
But the word is out: after two 'no' votes and a persistent economic malaise, doom and gloom scenarios are being heard about the future of the euro, Dutch newspaper 'De Volkskrant' reported on Friday.
"It is no longer unthinkable that the euro will bust," Leuven University international economics professor Paul de Grauwe said.
Underpinning his assertions, a professor with the European University in Florence, Rick van der Ploeg, said the present political reality could lead to the end of the euro.
Opponents to the euro, including Amsterdam University economics professor Sweder van Wijnbergen, warned in the 1990s Europe could not have a single currency because the economies of the various countries were so different. A single currency would also require a political union, he said.
Supporters of the currency said a political union would arise naturally due to the introduction of a joint currency.
However, De Grauwe said political integration appears to be dead after the no votes in the Netherlands and France, despite the fact "a political union is necessary for a healthy euro".
Van Wijnbergen says the growth rates of European economies are still widely different and it is no longer possible for individual nations to maintain different monetary policy or exchange rates to buffer economic imbalances.
If EU workers relocated to regions with good economic growth, economic differences would level out. But labour mobility does not and will never exist, Van Wijnbergen claimed.
However, he rejected the overnight dismantling of the euro due to the high costs involved and Van der Ploeg said the joint currency can still be rescued. This would depend on France and Germany reforming their labour markets, he said.
And John Kerry wanted us to become more like Europe...
Ping...
Has Chirac asked us to bail out the Euro yet?
Give him until Bastille Day!
sp
Simple solution for the Europeans:
Get religion,
Get pregnant,
Get pregnant a few more times.
Incidentally did you know John Kerry went to Vietnam and won a ton a of medals? No kidding its true. I heard Dan Rather report it on TV and everything.
Yeah, right. Good luck talking the french unions into 'reforming' to save the Euro. They refuse to reform even to save themselves.
You don't say?! Why didn't Kerry ever talk about this during the campaign? /sarc
On John Kerry, I think they reported it in Newsweak as well.
Poor Soros. I wonder just how much he invested in the Euro to
undermine the US dollar. Now to protect his money he has no choice but to buy back the USD to avoid loosing too much.
Moveoff and Democrat coffers might be a little short of contributions this year...
The EU constitution is reject; chaos ensues; the US will need to intervene with troops to quell violence; we set up new governments throughout Europe; spend a couple of trillions of dollars on a new "Marshall Plan" to jump start the European economy...And within a generation, they'll be back to hating us.
Kerry campaigned? I'm surprised I missed it. I'd have thought I would have noticed a war hero with a chest full of medals running for office.
Well, this isn't going to be a popular sentiment on FR, but I say let the doom-sayers talk it into the tank, and then the "smart" money will set up as many Euro-denominated accounts as possible for the ride back up again. The "success" of the Euro has some major players behind it, the objections (valid or not) of voters in various nations notwithstanding. I wouldn't count on it going away, or even going down and staying down.
How could they have been so foolish to presume that high growth, low tax countries(eastern Europe)and high tax, low growth nanny states could be managed by the same monetary policy. It seems pretty damned funny that such an enlightened group of preening elites could have gotten it so wrong.
I guess he was "AWOL"
That is more like a dollar's worth;) And, unfortunately you are probably correct.
kindly
sp
I need to buy a euro as a souvenir.
I heard John Kerry spent some time on a missle friggat that was no where near Nam, then took a post on a swift boat for 4 months, where he was basicly a coward, claimed 3 purple hearts for self inflicted scratches which were treated with a band-aid, shot an unarmed kid who was fleeing in the back, and claimed a silver star based on his own altered report. then he deserted the army and became a traitor and conspired with the enemy while still under the obligations of his navy contract.
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