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Germany is obsessed with keeping the value of the Euro low to maximize their exports. That's one of the reasons they've been pushing austerity after the economi

Germany is obsessed with keeping the value of the Euro low to maximize their exports. That's one of the reasons they've been pushing austerity after the economic crisis, as keeping countries like Greece, Portugal etc. in a rut depreciates the currency (the other reason is a weird sense that countries in debt have committed some moral failing and should be punished). Their trade surplus has been a subject of intense criticism by economists and other EU states, but Germany calls the shots in the eurozone economy. https://www.economist.com/leaders/2017/07/08/why-germanys-current-account-surplus-is-bad-for-the-world-economy https://www.economist.com/leaders/2017/07/08/why-germanys-cu...

pergadad 7y ago
That's nonsense. The reason for low interest rates is so that Italy won't collapse. It's widely hated in Germany as bank accounts have basically zero interest nowadays.
- Fishysoup 7y ago
  They also blamed Greece for the bailout, which was a bailout of German banks. Yes the situation obviously isn't completely one-sided and there's more than one actor here, but don't pretend Germany is doing everything out of the goodness of its heart and to protect the EU. They're as selfish as any other country.
  - kyuudou 7y ago
    I heard there was quite a fire sale on pretty Greek islands during that time.
- QuesnayJr 7y ago
  The comment you are replying to said "the value of the euro", not low interest rates. Interest rates are so low not because of Italy, but because the German government stopped borrowing. If you cut the supply of something, the price goes up. If the price of bonds go up, then the interest rate goes down.
rossdavidh 7y ago
In Germany's defense, they never asked for the Euro, it was more or less forced on them as the price for France not pitching a fit about German reunification. Essentially, the rest of the Eurozone is running on Deutschmarks, and calling it the "Euro" instead of the "Deutschmark" is just a face-saving measure. Germany, unlike most other countries in the Eurozone, could announce tomorrow that they were leaving the Euro, and there would be no run on the banks. There might, though, be a run TO the banks, to deposit your Euros in time to get them magically changed into Deutschmarks. So, Germany acts like they run the Eurozone, because the Euro runs on Germany's economic status. Now, why Italy, Greece, etc. continue to remain inside a currency zone that is not appropriately valued for them, is a different question. I would not be surprised that, if the League ever gets control of the Italian government, they will withdraw. But until then, the Mediterranean countries are handicapping their own economic competitiveness voluntarily, it's not as if it's Germany's fault, since it wasn't Germany's idea.
- dx034 7y ago
  The Euro is quite popular in Germany and has gained popularity in recent years. It wasn't very popular at the start but this has definitely changed. And if Germany got rid of the Euro this would certainly cause bank runs since Germans would be afraid that the Euro quickly devalues against the new currency.
- imtringued 7y ago
  The problem in italy is deeper than just the euro. The euro is just one of many factors but it has a higher visibility because it is beyond the control of a single country. Italy can only blame itself for all the other problems. This also applies to other countries in the eurozone.

pergadad 7y ago

That's nonsense. The reason for low interest rates is so that Italy won't collapse. It's widely hated in Germany as bank accounts have basically zero interest nowadays.

Fishysoup 7y ago
They also blamed Greece for the bailout, which was a bailout of German banks. Yes the situation obviously isn't completely one-sided and there's more than one actor here, but don't pretend Germany is doing everything out of the goodness of its heart and to protect the EU. They're as selfish as any other country.
- kyuudou 7y ago
  I heard there was quite a fire sale on pretty Greek islands during that time.
QuesnayJr 7y ago
The comment you are replying to said "the value of the euro", not low interest rates. Interest rates are so low not because of Italy, but because the German government stopped borrowing. If you cut the supply of something, the price goes up. If the price of bonds go up, then the interest rate goes down.

rossdavidh 7y ago

In Germany's defense, they never asked for the Euro, it was more or less forced on them as the price for France not pitching a fit about German reunification. Essentially, the rest of the Eurozone is running on Deutschmarks, and calling it the "Euro" instead of the "Deutschmark" is just a face-saving measure. Germany, unlike most other countries in the Eurozone, could announce tomorrow that they were leaving the Euro, and there would be no run on the banks. There might, though, be a run TO the banks, to deposit your Euros in time to get them magically changed into Deutschmarks. So, Germany acts like they run the Eurozone, because the Euro runs on Germany's economic status. Now, why Italy, Greece, etc. continue to remain inside a currency zone that is not appropriately valued for them, is a different question. I would not be surprised that, if the League ever gets control of the Italian government, they will withdraw. But until then, the Mediterranean countries are handicapping their own economic competitiveness voluntarily, it's not as if it's Germany's fault, since it wasn't Germany's idea.

dx034 7y ago
The Euro is quite popular in Germany and has gained popularity in recent years. It wasn't very popular at the start but this has definitely changed. And if Germany got rid of the Euro this would certainly cause bank runs since Germans would be afraid that the Euro quickly devalues against the new currency.
imtringued 7y ago
The problem in italy is deeper than just the euro. The euro is just one of many factors but it has a higher visibility because it is beyond the control of a single country. Italy can only blame itself for all the other problems. This also applies to other countries in the eurozone.