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Sovereign countries can exit anything they decide to, unless overpowered by force.

inglor_cz 5y ago
Now the question is: are you still a sovereign country if you pooled your currency with N other countries that exert a common decision power through a central bank over it? Having power over your own currency, in good or bad, is a typical attribute of being sovereign. There are minor exceptions (like Kosovo adopting euro unilaterally), but they are very untypical.
- gambiting 5y ago
  Were you forced to do that, or was that a sovereign choice? The answer lies there.
  - inglor_cz 5y ago
    I am not even sure if we agree on the question, much less answer. Some sovereign choices in history have proven to be "Hotel California"-style: joining a scheme was a sovereign choice, but leaving it not so much. An obvious example is the US which does not let the constituent states secede, even though they joined the Union voluntarily. In a similar vein, Scotland joined the UK voluntarily (though in serious economic crisis), but it cannot just leave on its own when it decides to. The process of joining the euro has been constructed as one-way only. There are no legal mechanisms to get rid of this obligation once you join. Euro is intended to last forever.
- Godel_unicode 5y ago
  It's a very common practice for economies to peg their sovereign currency to a trading partner; there are on the order of 66 countries pegged to the US Dollar, and 20-odd pegged to the euro. If a country wanted to move off of the euro, it would be pretty easy to create a sovereign currency pegged to the euro 1:1 by the countries central bank. Then in the future they could simply unpeg (or change the rate) if that became advantageous.
  - inglor_cz 5y ago
    "it would be pretty easy to create a sovereign currency pegged to the euro 1:1 by the countries central bank" How will you protect the peg? If moving off the euro is taken as a sign of your weakness, defending the peg against the market shorting you will bleed your central bank dry.
    - User23 5y ago
      It’s easy to put a ceiling on your country’s currency trading range. The Swiss did this. Whenever the franc got too high their central bank would sell however much was necessary to stabilize the price.
      - exoque 5y ago
        And they stopped doing that because it wasn't maintainable.
        User23 5y ago
        Of course it was maintainable. They stopped doing it because the situation in the EZ more or less stabilized. The Swiss central bank can always sell as many Francs as they want at any price that is below current bids and that’s always the case when defending an upside limit. They’re never going to run out of Francs to sell because they can issue without any technical limit.
    - ben_w 5y ago
      IIRC, this was effectively what happened with the U.K. on Black Wednesday: https://en.wikipedia.org/wiki/Black_Wednesday https://en.wikipedia.org/wiki/Black_Wednesday
  - pyuser583 5y ago
    EU members aren’t fully sovereign. Some sovereignty is surrendered when joining the EU: > "The EU law has primacy over national law and all decisions by the European Court of Justice, including orders for interim measures, are binding on member states’ authorities and national courts,” chief spokesperson Eric Mamer said. https://abcnews.go.com/International/wireStory/eu-court-polands-disciplining-judges-breaches-eu-law-78857560 https://abcnews.go.com/International/wireStory/eu-court-pola... Also, a Eurozone country can’t abandon with Euro without leaving the EU. The context here is comparing the the EU with the British Empire. Statements like “The EU law has primacy over national law” make it pretty clear what it means to be a member of the EU.
- raverbashing 5y ago
  Are you still a sovereign country when your currency is worth absolutely nothing and most internal transactions are done in a foreign currency? (case of several countries?) "Having power over your own currency" is something not even the US has. Of course they're the hardest to push, but they don't have full control.
- nradov 5y ago
  You're a sovereign country if you're able to sustain military control over your claimed territory. That's the only factor which really counts.
- mbrodersen 5y ago
  Of course you are. Unless somebody threatens to physically invade your country, your country can do whatever it wants. However there might obviously be trade/export/import sanctions etc.

Now the question is: are you still a sovereign country if you pooled your currency with N other countries that exert a common decision power through a central bank over it? Having power over your own currency, in good or bad, is a typical attribute of being sovereign. There are minor exceptions (like Kosovo adopting euro unilaterally), but they are very untypical.

gambiting 5y ago
Were you forced to do that, or was that a sovereign choice? The answer lies there.
- inglor_cz 5y ago
  I am not even sure if we agree on the question, much less answer. Some sovereign choices in history have proven to be "Hotel California"-style: joining a scheme was a sovereign choice, but leaving it not so much. An obvious example is the US which does not let the constituent states secede, even though they joined the Union voluntarily. In a similar vein, Scotland joined the UK voluntarily (though in serious economic crisis), but it cannot just leave on its own when it decides to. The process of joining the euro has been constructed as one-way only. There are no legal mechanisms to get rid of this obligation once you join. Euro is intended to last forever.
Godel_unicode 5y ago
It's a very common practice for economies to peg their sovereign currency to a trading partner; there are on the order of 66 countries pegged to the US Dollar, and 20-odd pegged to the euro. If a country wanted to move off of the euro, it would be pretty easy to create a sovereign currency pegged to the euro 1:1 by the countries central bank. Then in the future they could simply unpeg (or change the rate) if that became advantageous.
- inglor_cz 5y ago
  "it would be pretty easy to create a sovereign currency pegged to the euro 1:1 by the countries central bank" How will you protect the peg? If moving off the euro is taken as a sign of your weakness, defending the peg against the market shorting you will bleed your central bank dry.
  - User23 5y ago
    It’s easy to put a ceiling on your country’s currency trading range. The Swiss did this. Whenever the franc got too high their central bank would sell however much was necessary to stabilize the price.
    - exoque 5y ago
      And they stopped doing that because it wasn't maintainable.
      - User23 5y ago
        Of course it was maintainable. They stopped doing it because the situation in the EZ more or less stabilized. The Swiss central bank can always sell as many Francs as they want at any price that is below current bids and that’s always the case when defending an upside limit. They’re never going to run out of Francs to sell because they can issue without any technical limit.
  - ben_w 5y ago
    IIRC, this was effectively what happened with the U.K. on Black Wednesday: https://en.wikipedia.org/wiki/Black_Wednesday https://en.wikipedia.org/wiki/Black_Wednesday
- pyuser583 5y ago
  EU members aren’t fully sovereign. Some sovereignty is surrendered when joining the EU: > "The EU law has primacy over national law and all decisions by the European Court of Justice, including orders for interim measures, are binding on member states’ authorities and national courts,” chief spokesperson Eric Mamer said. https://abcnews.go.com/International/wireStory/eu-court-polands-disciplining-judges-breaches-eu-law-78857560 https://abcnews.go.com/International/wireStory/eu-court-pola... Also, a Eurozone country can’t abandon with Euro without leaving the EU. The context here is comparing the the EU with the British Empire. Statements like “The EU law has primacy over national law” make it pretty clear what it means to be a member of the EU.
raverbashing 5y ago
Are you still a sovereign country when your currency is worth absolutely nothing and most internal transactions are done in a foreign currency? (case of several countries?) "Having power over your own currency" is something not even the US has. Of course they're the hardest to push, but they don't have full control.
nradov 5y ago
You're a sovereign country if you're able to sustain military control over your claimed territory. That's the only factor which really counts.
mbrodersen 5y ago
Of course you are. Unless somebody threatens to physically invade your country, your country can do whatever it wants. However there might obviously be trade/export/import sanctions etc.