• Eurozone is 'unsustainable' warns Mario Draghi
    6 replies, posted
[img]http://i.telegraph.co.uk/multimedia/archive/02235/draghi_2235977b.jpg[/img] [sub]ECB President Draghi arrives at the European Parliament economic and monetary affairs committee in Brussels on Thursday[/sub] [quote=Louise Armitstead, Chief business correspondent]Mario Draghi said the central bank could not "fill the vacuum" left by member states' lack of action as it was claimed the zone is on the point of "disintegration". Amid escalating talk of a potential bail-out for Spain, the president of the ECB said the central bank was powerless to stop the debt tornado. "It's not our duty, it's not in our mandate" to "fill the vacuum left by the lack of action by national governments on the fiscal front," he said. Olli Rehn, the EU's top economic official, called for urgent action to "avoid a disintegration of the eurozone." The economic affairs commissioner said that politicians had made progress but it had been "uneven and seemingly inefficient." Underling the fears gripping many investors, the FTSE closed down 7.5pc in May, suffering its worst month since February 2009 when the banking crisis was at its height. A raft of poor economic data in America compounded fears for the eurozone and the global economy. US GDP expanded by just 1.9pc in the first quarter, rather than the 2.2pc first estimate, while jobless claims climbed. [/quote] [url=http://www.telegraph.co.uk/finance/financialcrisis/9304027/Eurozone-is-unsustainable-warns-Mario-Draghi.html]The Telegraph[/url]
[media]http://www.youtube.com/watch?v=RQ9uHUDkTq4[/media]
I always thought that the eurozone's deep-reaching control over the financial markets of europe was comparable to the overly intrusive and ineffective economic control policies of economically totalitarian countries. Acting in the best interest of ones own country is considered backwards? How can an economy grow when it is controlled by an external part without sufficient knowledge regarding specific external and internal market conditions surrounding it?
What would happen if the euro broke up?
And Malthus thought we'd be dead by now. These predictions are either hilarious or wrong. I don't see how you can predict these things with even 50% certainty.
[QUOTE=Kendra;36147760]And Malthus thought we'd be dead by now. These predictions are either hilarious or wrong. I don't see how you can predict these things with even 50% certainty.[/QUOTE] First of all; Malthus was a pure theoreticst. Population growth is hardly comparable to economics when it comes to predicting future development as economic systems have clear inputs (raw materials and industry) and somewhat predictable dynamics. The issue here isn't even whether or not you can predict the future development of the eurozone, but what is to blame for its shortcomings in the face of economic adversity. A fixed currency, more than anything, imposes an unfair market indiscriminately. The value of the € doesn't fluctuate much when one of its constituent markets "needs" it to, inflation doesn't react to local fluctuations. Therefore, small economies get locked into endless debt spirals and recession. The funny part is that when the euro does react to weak markets collapsing, the stronger member states reap the benefit. It's not half bad being able to still produce goods when you are in a weaker economical climate, especially when you are able to dictate economic policy across the board (the case of germany). It's really a case of who pays and who gets payed, not a singular european state as some would have it. A horrifically inefficient system, and an unfair one at that. It is as Engels told Marx: "I warned you about states bro" "I told you dog..."
[QUOTE=Roof;36147714]What would happen if the euro broke up?[/QUOTE] Shit would hit the fan for some places (Greece )and some places would be fine I guess (like Germany) that's what I think anyways
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