4 ms·

Yeah Europe is stupid, if only our leaders were as wise as a random blogger! But please explain me this: EUR/USD started at 1,17 at inception and it is still at

by Atropos 14y ago

Yeah Europe is stupid, if only our leaders were as wise as a random blogger! But please explain me this: EUR/USD started at 1,17 at inception and it is still at 1,26 now. US 10 year bond yield is 1,67420 and Germany's is 1,58100. US debt/gdp is around 101% and Germany's is 81,2%. Moreover the US has a huge trade deficit and Germany has a huge trade surplus. To me the eurocrisis seems primarily a US/UK media thing...

adventureful 14y ago
The EU crisis is absolutely not a US/UK media thing. Half the Eurozone is melting down, and requires trillions in bailouts from 'printed' Euros to bail them out. It's from decades of unpaid-for lifestyle choices, accumulated debt from Socialism (same thing America is choking on, we just spent more of our money on things like war, but that's a welfare program too for jobs and corporations). The US is in much worse shape than most are willing to admit or accept, but the US has the global reserve currency it gets to abuse. That changes the game dramatically for the US. If the Eurozone had properly integrated its system, they might have stood a better chance, as it would have been easier to inflate, issue Euro bonds, and buy a lot more time as the US is doing. The EU is half a properly integrated system. However, you refer to the US Dollar vs the Euro, but then you pick one specific country on the bond yield. Why not pick Switzerland? They have negative yields. How about the bond yields for Spain, France, Portugal, Italy? France is going to explode next, so we can throw them in as well.
- Atropos 14y ago
  At the moment only Greece (2,65% of eurozone gdp), Portugal (1,83%) and Ireland (1,82%) have received bailouts - which makes 6,3% not "half the Eurozone melting down". Spanish banks may get a €100b bankout aswell - big deal. But I agree with you on the source of the problem - socialism or uneconomic regulation. That is visible in the doing business rankings of the world bank (http://www.doingbusiness.org/rankings http://www.doingbusiness.org/rankings). Ireland(rank 10), France(29),Portugal(30) will hopefully be fine. Spain at 44 is troubling; I'm only really worried about Italy (87) and Greece (100). However Portugal+Spain+Greece have voted in conservative governments, Italy has an interim economist technocrat government. There is the European Fiscal Compact (http://en.wikipedia.org/wiki/European_Fiscal_Compact http://en.wikipedia.org/wiki/European_Fiscal_Compact). And Germany is pushing very hard for economic reforms in the bailout countries. Overall it is just a problem with a few countries with bad governments/regulation, not a "Euro" problem and certainly not a European Union problem... And we seem to be taking more steps dealing with it then the US or UK with their problems! I compared to the US$ because the import/export in USD or GBP is incredibly more significant than the few currencies the Euro has done badly against, like the Swiss Francs or Japanese Yen or Norwegian/Swedisch Krones etc...
  - excuse-me 14y ago
    How is California's debt looking these days?
  - mixmax 14y ago
    The problem isn't socialism, it's a divergence of productivity between the northern and southern regions of the euro area. When you combine this with a shared currency you're asking for trouble. Note that the socialist nordic countries have stellar economies. I've noticed a lot of Americans blame the euro crisis on socialism which,is interesting since it doesn't seem to hold up to scrutiny. I'd be interested in hearing why this is. Is it the media, an American distrust of socialism or something else?
    - Atropos 14y ago
      I only used the word "socialism" because the other commenter used it - in the original meaning of the word it doesn't exist anywhere in Europe. What I meant is simply bad regulation. You are correct that some of the nordish countries have a more ,,left'' reputation and have things like high taxes, alot of redistribution etc... But if you look at the "Heritage Ranking of Economic Freedom" (http://www.heritage.org/index/ranking http://www.heritage.org/index/ranking), you see: - Denmark (Rank 11), Finland (17), Sweden (21) - Spain(36), Portugal(68), Italy(92), Greece(119)
    - potatolicious 14y ago
      I've noticed that socialism is definitely a pejorative term in the US - which dismays me as a socialist-leaning Canadian. It's like economic Godwin - call someone a socialist and effective discourse just kind of grinds to a halt. It's the modern "communism", without invoking the spirit of McCarthy.
      - gnaritas 14y ago
        It's a pejorative among conservatives, not among liberals.
        14y ago

by Atropos 14y ago

adventureful 14y ago

The EU crisis is absolutely not a US/UK media thing. Half the Eurozone is melting down, and requires trillions in bailouts from 'printed' Euros to bail them out. It's from decades of unpaid-for lifestyle choices, accumulated debt from Socialism (same thing America is choking on, we just spent more of our money on things like war, but that's a welfare program too for jobs and corporations). The US is in much worse shape than most are willing to admit or accept, but the US has the global reserve currency it gets to abuse. That changes the game dramatically for the US. If the Eurozone had properly integrated its system, they might have stood a better chance, as it would have been easier to inflate, issue Euro bonds, and buy a lot more time as the US is doing. The EU is half a properly integrated system. However, you refer to the US Dollar vs the Euro, but then you pick one specific country on the bond yield. Why not pick Switzerland? They have negative yields. How about the bond yields for Spain, France, Portugal, Italy? France is going to explode next, so we can throw them in as well.

Atropos 14y ago
At the moment only Greece (2,65% of eurozone gdp), Portugal (1,83%) and Ireland (1,82%) have received bailouts - which makes 6,3% not "half the Eurozone melting down". Spanish banks may get a €100b bankout aswell - big deal. But I agree with you on the source of the problem - socialism or uneconomic regulation. That is visible in the doing business rankings of the world bank (http://www.doingbusiness.org/rankings http://www.doingbusiness.org/rankings). Ireland(rank 10), France(29),Portugal(30) will hopefully be fine. Spain at 44 is troubling; I'm only really worried about Italy (87) and Greece (100). However Portugal+Spain+Greece have voted in conservative governments, Italy has an interim economist technocrat government. There is the European Fiscal Compact (http://en.wikipedia.org/wiki/European_Fiscal_Compact http://en.wikipedia.org/wiki/European_Fiscal_Compact). And Germany is pushing very hard for economic reforms in the bailout countries. Overall it is just a problem with a few countries with bad governments/regulation, not a "Euro" problem and certainly not a European Union problem... And we seem to be taking more steps dealing with it then the US or UK with their problems! I compared to the US$ because the import/export in USD or GBP is incredibly more significant than the few currencies the Euro has done badly against, like the Swiss Francs or Japanese Yen or Norwegian/Swedisch Krones etc...
- excuse-me 14y ago
  How is California's debt looking these days?
- mixmax 14y ago
  The problem isn't socialism, it's a divergence of productivity between the northern and southern regions of the euro area. When you combine this with a shared currency you're asking for trouble. Note that the socialist nordic countries have stellar economies. I've noticed a lot of Americans blame the euro crisis on socialism which,is interesting since it doesn't seem to hold up to scrutiny. I'd be interested in hearing why this is. Is it the media, an American distrust of socialism or something else?
  - Atropos 14y ago
    I only used the word "socialism" because the other commenter used it - in the original meaning of the word it doesn't exist anywhere in Europe. What I meant is simply bad regulation. You are correct that some of the nordish countries have a more ,,left'' reputation and have things like high taxes, alot of redistribution etc... But if you look at the "Heritage Ranking of Economic Freedom" (http://www.heritage.org/index/ranking http://www.heritage.org/index/ranking), you see: - Denmark (Rank 11), Finland (17), Sweden (21) - Spain(36), Portugal(68), Italy(92), Greece(119)
  - potatolicious 14y ago
    I've noticed that socialism is definitely a pejorative term in the US - which dismays me as a socialist-leaning Canadian. It's like economic Godwin - call someone a socialist and effective discourse just kind of grinds to a halt. It's the modern "communism", without invoking the spirit of McCarthy.
    - gnaritas 14y ago
      It's a pejorative among conservatives, not among liberals.
      - 14y ago