The euro is a disaster even for the countries that do everything right

Hazir

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Quote from: Amph on July 20, 2015, 02:11:13 AM

ok but they spend more? because they know that their ass is covered from central bank, without the euro, and everyone with his own old fiat, this wasn't possible

so they would have played their money more wisely, but when you know that someone else can pay for your shittiness you will be addicted in wasting money, that's a truth

The main problem was donations from EU, not euro as currency or involvement of EU central bank. There are some countries which are part of the European Union and still have their own old currency.
These countries receive donations in euro and then convert it to their own currency. So as we can see borrowing money is the problem, debt created this way cannot be regulated.

dinofelis

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Quote from: Amph on July 20, 2015, 02:11:13 AM

Quote from: Slark on July 19, 2015, 06:22:52 AM

Some of you seem not to understand that Euro per se is not the problem at all. It is just as you would blame bitcoin for online black markets or money laundering.
Greece did not bankrupt because they accepted Euro as their currency! The problem is economy system, spending more money that you got and insane debt creation.
Also donations from Eurozone are not good way to improve economy of countries with bad economy as they create more debt than it is possible to pay.

ok but they spend more? because they know that their ass is covered from central bank, without the euro, and everyone with his own old fiat, this wasn't possible

so they would have played their money more wisely, but when you know that someone else can pay for your shittiness you will be addicted in wasting money, that's a truth

They THOUGHT their ass was covered by the central bank. Now they find out it wasn't, and they are going to eat cockroaches for a few decades. The next one trying to do so, will cool down quite quickly I'd say.

dinofelis

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It is very funny to read such a thing from someone who is supporting crypto currencies.

How would you devaluate Greek bitcoin if the whole world were using bitcoin for instance ?

Quote from: LiteCoinGuy on July 18, 2015, 12:47:32 AM

The euro is a disaster even for the countries that do everything right

But despite all this, Iceland has still managed to outperform Finland and the Netherlands. How is that possible? Well, it doesn't have the euro. It has its own currency, the krona. And as much as it hurt Iceland's people to lose 60 percent of their purchasing power on imported goods when the krona fell that much, it helped Iceland's economy by making their goods more competitive overseas. That was enough to keep what could have been a depression from turning into anything other than a bad recession.

The euro, though, does the opposite. Countries can't devalue their currencies or cut interest rates or even spend more when they get into trouble, and so they stay in trouble. All they can do is cut wages, cut spending, and then cut wages some more as penance for whatever economic transgressions they may or may not have committed. The euro straitjacket, in other words, turns ordinary problems into extraordinary ones (Finland) and extraordinary problems into historic ones (Greece). And that can happen whether or not you follow the rules.

The euro is a capricious god, meting out punishment to sinners and saints alike.

http://www.washingtonpost.com/blogs/wonkblog/wp/2015/07/17/the-euro-is-a-disaster-even-for-the-countries-that-do-everything-right/?postshare=3261437169131539

What is exactly great about the Euro is that there is not too much "redistribution of wealth" and that those trying to do so, like the Greek, fall hard on their faces. The "bailout" will totally annihilate what remains their economy, and rightly so. It is the price to pay to having desired getting "wealth distribution".

What one obtains with the Euro, is - like with cryptocurrencies - that no monetary manipulation can serve as an excuse for wealth re-distribution from the productive to the non-productive, and keeps the balances right: you can only consume what you produce. This is as it should be, and those wanting to live off others' production should end up eating cockroaches. As cryptocurrencies would also do.

Amph

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Quote from: Slark on July 19, 2015, 06:22:52 AM

Some of you seem not to understand that Euro per se is not the problem at all. It is just as you would blame bitcoin for online black markets or money laundering.
Greece did not bankrupt because they accepted Euro as their currency! The problem is economy system, spending more money that you got and insane debt creation.
Also donations from Eurozone are not good way to improve economy of countries with bad economy as they create more debt than it is possible to pay.

ok but they spend more? because they know that their ass is covered from central bank, without the euro, and everyone with his own old fiat, this wasn't possible

so they would have played their money more wisely, but when you know that someone else can pay for your shittiness you will be addicted in wasting money, that's a truth

n2004al

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Quote from: BillyBobZorton on July 18, 2015, 10:43:21 AM

Quote from: n2004al on July 18, 2015, 02:11:40 AM

Quote from: LiteCoinGuy on July 18, 2015, 12:47:32 AM

The euro is a disaster even for the countries that do everything right

But despite all this, Iceland has still managed to outperform Finland and the Netherlands. How is that possible? Well, it doesn't have the euro. It has its own currency, the krona. And as much as it hurt Iceland's people to lose 60 percent of their purchasing power on imported goods when the krona fell that much, it helped Iceland's economy by making their goods more competitive overseas. That was enough to keep what could have been a depression from turning into anything other than a bad recession.

The euro, though, does the opposite. Countries can't devalue their currencies or cut interest rates or even spend more when they get into trouble, and so they stay in trouble. All they can do is cut wages, cut spending, and then cut wages some more as penance for whatever economic transgressions they may or may not have committed. The euro straitjacket, in other words, turns ordinary problems into extraordinary ones (Finland) and extraordinary problems into historic ones (Greece). And that can happen whether or not you follow the rules.

The euro is a capricious god, meting out punishment to sinners and saints alike.

http://www.washingtonpost.com/blogs/wonkblog/wp/2015/07/17/the-euro-is-a-disaster-even-for-the-countries-that-do-everything-right/?postshare=3261437169131539

I don't agree this. The euro is doing great for Germany. Maybe the euro has problems as a currency because of its creation conditions but this cannot make it a bad currency for all the users. The euro maybe is a questionable currency for that countries that has economic problems. This is to be discussed but for sure not for the countries.

Things aren't that good in Germany. A lot of Germans are working for peanuts and are working on stuff that they didn't study for. Basically a lot of the employment rates in germany are thanks to the so called minijobs which are basically shitty jobs of a small period of time and underpaid. No country is doing great unless they have tons of oil (norway).

I'm surprised to read this. All the economic data and all the opinions I have from some friends who live in Germany are positive. maybe not everyone is not good but the overall situation is very good. While for the countries with oil I don't agree. They are suffering. The price of oil is halved and even important countries like Russia are in trouble because of this. The oil revenues are lowered fearfully and this has affected even the overall economic data of this country.

qiwoman2

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Quote from: BIT-Sharon on July 19, 2015, 10:17:20 PM

Like the Greek government who wastes money casually, and debts with people to live, and do not make efforts for improving themselves, leading to the fiscal deficits exploded. What could EU do? If Greece quits from eurozone, it would be the disaster of euro. The countries which are on their way up do not need to attend the defective currency system.

Also it's the EUROZONE's policy fault as well that helped close down much of the industry in Greece and was lending out the money with high interest rates..so it's a double whammy, not only the people's fault..The euro is a failed currency experiment that can't work long term...NOT unless all EU member states have strong and thriving economies..

BIT-Sharon

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Like the Greek government who wastes money casually, and debts with people to live, and do not make efforts for improving themselves, leading to the fiscal deficits exploded. What could EU do? If Greece quits from eurozone, it would be the disaster of euro. The countries which are on their way up do not need to attend the defective currency system.

galbros

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Quote from: Slark on July 19, 2015, 06:22:52 AM

Some of you seem not to understand that Euro per se is not the problem at all. It is just as you would blame bitcoin for online black markets or money laundering.
Greece did not bankrupt because they accepted Euro as their currency! The problem is economy system, spending more money that you got and insane debt creation.
Also donations from Eurozone are not good way to improve economy of countries with bad economy as they create more debt than it is possible to pay.

You are right, the Euro didn't create the problem, though it may have enabled them to borrow at a lot lower rates than they otherwise would have been able to, but continuing to use the Euro keeps them from getting out of the problem as easily as if they were not by not allowing them to devalue their currency. Also, since their debt is in a currency they can't "print" it allows them to default.

neurotypical

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Quote from: Slark on July 19, 2015, 06:22:52 AM

Some of you seem not to understand that Euro per se is not the problem at all. It is just as you would blame bitcoin for online black markets or money laundering.
Greece did not bankrupt because they accepted Euro as their currency! The problem is economy system, spending more money that you got and insane debt creation.
Also donations from Eurozone are not good way to improve economy of countries with bad economy as they create more debt than it is possible to pay.

Not every country is going to be an industry giant or come up with something really clever that gives them money, or have a lot of oil reserves. Some countries life off their tourism as the first way of revenue, Greece was one of them, until it made it into the headliness by being a near bankrupt country.

Falconer

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Quote from: Slark on July 19, 2015, 06:22:52 AM

Some of you seem not to understand that Euro per se is not the problem at all. It is just as you would blame bitcoin for online black markets or money laundering.
Greece did not bankrupt because they accepted Euro as their currency! The problem is economy system, spending more money that you got and insane debt creation.
Also donations from Eurozone are not good way to improve economy of countries with bad economy as they create more debt than it is possible to pay.

Yeah they will always seek a new method to get new fund from Eurozone. Euro is not a disaster, but greece is a disaster to eurozone. Greece still facing crisis although they didn't using euro as their currency.

Stedsm

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It is not the EURO that is being backed by itself, it is people like Draghi and Merkel who are destroying the hopes of everyone.

Slark

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Some of you seem not to understand that Euro per se is not the problem at all. It is just as you would blame bitcoin for online black markets or money laundering.
Greece did not bankrupt because they accepted Euro as their currency! The problem is economy system, spending more money that you got and insane debt creation.
Also donations from Eurozone are not good way to improve economy of countries with bad economy as they create more debt than it is possible to pay.

countryfree

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Your country may be your worst enemy

The Germans would have a much stronger currency than the €, had they kept their Deutschmarks. I've seen German demonstrations against the € in Frankfurt. No mainstream German politician dares to be vocal against the €, but that may change with Germany's losing even more money trying to jack up Greece. Still, I, like million others appreciate the ease of a single currency between so many countries, and the best proof that it's a success is its growing acceptance in Switzerland. You can pay with € in thousands of Swiss shops.

LiteCoinGuy

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Quote from: botany on July 18, 2015, 07:32:15 PM

Quote from: galbros on July 18, 2015, 08:19:49 AM

The euro does simplify transactions within Europe no doubt.

In the absence of the Euro Germany's currency would rise and Greece's would fall, the latter dramatically. However, with the Euro this does not happen. Imbalances arise between countries. The same thing happens in the US between say California and Mississippi. However, the US has fiscal union as well as monetary union, so it can simply redistribute wealth from California to Mississippi (and it does) to offset this. This is one of the reasons many economists said the Euro was doomed to failure.

Essentially this is what the bailout is kinda sorta trying to do, provide some fiscal relief to Greece, but the Germans, understandably, don't want to do it. Just like if the Californians had to vote to send money to Mississippi.

So Germany, or any other successful exporter in the Euro area, is the bigger economic winner from the Euro.

Euro-level bonds could be one solution, but Germany is strongly against it. Even if it doesn't involve the actual transfer of wealth, it could be thought of as Germany providing a guarantee to the debt of Greece. That ways, Greece wouldn't be locked out of the capital markets.

it is a bad idea to have euro-bonds when every country can do what it wants with their money. that is the reason it will not work.

you have to have a political union before a fiscal union or all will end in a "big mess"...

botany

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Quote from: galbros on July 18, 2015, 08:19:49 AM

The euro does simplify transactions within Europe no doubt.

In the absence of the Euro Germany's currency would rise and Greece's would fall, the latter dramatically. However, with the Euro this does not happen. Imbalances arise between countries. The same thing happens in the US between say California and Mississippi. However, the US has fiscal union as well as monetary union, so it can simply redistribute wealth from California to Mississippi (and it does) to offset this. This is one of the reasons many economists said the Euro was doomed to failure.

Essentially this is what the bailout is kinda sorta trying to do, provide some fiscal relief to Greece, but the Germans, understandably, don't want to do it. Just like if the Californians had to vote to send money to Mississippi.

So Germany, or any other successful exporter in the Euro area, is the bigger economic winner from the Euro.

Euro-level bonds could be one solution, but Germany is strongly against it. Even if it doesn't involve the actual transfer of wealth, it could be thought of as Germany providing a guarantee to the debt of Greece. That ways, Greece wouldn't be locked out of the capital markets.

OROBTC

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Quote from: LiteCoinGuy on July 18, 2015, 04:49:03 AM

Quote from: OROBTC on July 18, 2015, 02:03:48 AM

...

"George Washington", a blogger often featured at Zero Hedge, just blasted the euro as well:

http://www.zerohedge.com/news/2015-07-17/little-known-history-euro-crisis-was-baked-start

* * *

As an occasional tourist to Europe, I always liked it (toting around just one currency when visiting more than one of Italy, France, Germany, the Netherlands, etc.). I imagine that in-Europe transactions costs are lower too.

"It seemed like a good idea at the time" (to me anyway)

Yes, the euro would be a straitjacket, forcing relative conformity on economic policies of its members. And, yes, LiteCoinGuy, some countries that are not competitive would have trouble.

Nonetheless, I will want to read the article you posted just now, but damn!, that makes two more things I have to read tonight (China & its gold, and now another piece on the euro).

I did not foresee these consequences (Greece, Cyprus), nor do even recall reading any real warnings about the euro in 2000 or so, everything I read was pretty upbeat (or maybe I was not paying enough attention).

alot of people warned that this would happen. that one currency can fit for so many different countries. look in the history books, that did never work.

https://en.wikipedia.org/wiki/Latin_Monetary_Union

Thanks, L.C.G.! Interesting link. We here in America, of course, heard very little about the risks of a common currency. "Hey, if the idea works OK for California and Mississippi, then it's good enough for Europe..."

Also, Americans are not very famous for studying history.

But, you have to admit that the Latin Monetary Union produced some pretty gold coins...

EDIT: And I wonder how much good Bitcoin would do for ALL countries...? Same currency for the world?

BillyBobZorton

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Quote from: n2004al on July 18, 2015, 02:11:40 AM

Quote from: LiteCoinGuy on July 18, 2015, 12:47:32 AM

The euro is a disaster even for the countries that do everything right

But despite all this, Iceland has still managed to outperform Finland and the Netherlands. How is that possible? Well, it doesn't have the euro. It has its own currency, the krona. And as much as it hurt Iceland's people to lose 60 percent of their purchasing power on imported goods when the krona fell that much, it helped Iceland's economy by making their goods more competitive overseas. That was enough to keep what could have been a depression from turning into anything other than a bad recession.

The euro, though, does the opposite. Countries can't devalue their currencies or cut interest rates or even spend more when they get into trouble, and so they stay in trouble. All they can do is cut wages, cut spending, and then cut wages some more as penance for whatever economic transgressions they may or may not have committed. The euro straitjacket, in other words, turns ordinary problems into extraordinary ones (Finland) and extraordinary problems into historic ones (Greece). And that can happen whether or not you follow the rules.

The euro is a capricious god, meting out punishment to sinners and saints alike.

http://www.washingtonpost.com/blogs/wonkblog/wp/2015/07/17/the-euro-is-a-disaster-even-for-the-countries-that-do-everything-right/?postshare=3261437169131539

I don't agree this. The euro is doing great for Germany. Maybe the euro has problems as a currency because of its creation conditions but this cannot make it a bad currency for all the users. The euro maybe is a questionable currency for that countries that has economic problems. This is to be discussed but for sure not for the countries.

Things aren't that good in Germany. A lot of Germans are working for peanuts and are working on stuff that they didn't study for. Basically a lot of the employment rates in germany are thanks to the so called minijobs which are basically shitty jobs of a small period of time and underpaid. No country is doing great unless they have tons of oil (norway).

LiteCoinGuy

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Quote from: galbros on July 18, 2015, 08:19:49 AM

The euro does simplify transactions within Europe no doubt.

In the absence of the Euro Germany's currency would rise and Greece's would fall, the latter dramatically. However, with the Euro this does not happen. Imbalances arise between countries. The same thing happens in the US between say California and Mississippi. However, the US has fiscal union as well as monetary union, so it can simply redistribute wealth from California to Mississippi (and it does) to offset this. This is one of the reasons many economists said the Euro was doomed to failure.

Essentially this is what the bailout is kinda sorta trying to do, provide some fiscal relief to Greece, but the Germans, understandably, don't want to do it. Just like if the Californians had to vote to send money to Mississippi.

So Germany, or any other successful exporter in the Euro area, is the bigger economic winner from the Euro.

exactly. but german citizens cant vote Lips sealed

@Q7

i think so too Cry

.

the greek citizens will hopefully fight for freedom and their own currency.

Q7

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One of the inherent problems that I see with the euro is that by having so many countries each with their own style and way of management decides to congregate and form a group to share one single currency, all that doesn't seem like a good idea to me. When a country ran into trouble like what we are seeing right now, the rest will have to fork out the fund to bail it out. Essentially Greece are bound by that conditions as they don't have a complete control over the currency and will have to seek consensus on whatever things need to be done. It's bound to fail.

galbros

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The euro does simplify transactions within Europe no doubt.

In the absence of the Euro Germany's currency would rise and Greece's would fall, the latter dramatically. However, with the Euro this does not happen. Imbalances arise between countries. The same thing happens in the US between say California and Mississippi. However, the US has fiscal union as well as monetary union, so it can simply redistribute wealth from California to Mississippi (and it does) to offset this. This is one of the reasons many economists said the Euro was doomed to failure.

Essentially this is what the bailout is kinda sorta trying to do, provide some fiscal relief to Greece, but the Germans, understandably, don't want to do it. Just like if the Californians had to vote to send money to Mississippi.

So Germany, or any other successful exporter in the Euro area, is the bigger economic winner from the Euro.

Topic: The euro is a disaster even for the countries that do everything right (Read 1078 times)