Schoolkid's pizza plan for euro rescue earns Wolfson plaudits
10 replies, posted
[QUOTE]London (CNN) -- Jurre Hermans, the 11-year-old Dutch boy who entered the £250,000 ($400,000) Wolfson Economics Prize with a pizza-based plan for saving the eurozone, did so because he had an idea and the winnings sounded "very attractive," he told CNN.
Jurre received a €100 ($131) gift voucher and special mention when the prize shortlist was announced Tuesday for his detailed entry -- including a picture, below -- showing how debt can be exchanged for slices of pizza.
The competition was launched in October by Simon Wolfson, the man behind British retail chain Next, to try and find ways to deal with a collapse of the euro -- the currency tying together 17 European countries. The euro has been under intense pressure since Greece was forced to take a bail-out from its eurozone peers and the International Monetary Fund almost two years ago.
Through his father Julius, Jurre told CNN he had an idea to solve the euro crisis and also thought the prize money sounded "attractive."
Jurre, the youngest entrant to the prize, proposed Greece should leave the euro, with the Greek people slotting their funds into a bank "exchange machine" and getting drachma -- the Greek currency before the country joined the euro in 2001 -- back.
As Jurre explains in his application, the bank then gives the euros to the Greek government and "all these euros together form a pancake or a pizza. Now the Greek government can start to pay back all their debts, everyone who has a debt gets a slice of the pizza."
Jurre noted the "clever part" of his idea was that the Greek people would not want to change their euros for drachma, because they know the currency would depreciate. However, if they hide their euros, Jurre said they should be slapped with severe financial penalties.
Wolfson: Why Europe needs to think about a euro collapse
Jurre wrote: "In this way I ensure that all Greeks bring their euros to a greek bank and so the greek government can pay back all the debts. I hope my idea helps you!!!!"
Julius Hermans said he was proud his son thought about the world's problems and came up with solutions.
However, Jurre told CNN he plans to be a zoo director rather than an economist, because he loves animals. He also wants the euro to continue.
A list of the Wolfson finalists and their plans can be found here. The winner will be announced on July 5.
[img]http://i2.cdn.turner.com/cnn/2012/images/04/04/howtofixtheeuro.policyexchange.jpg[/img][/QUOTE]
Source: [url]http://www.cnn.com/2012/04/04/business/wolfson-prize-jurre-hermans/index.html?hpt=hp_bn2[/url]
I don't understand this, need to take a few more ECON courses first.
I don't understand this either.
Greeks convert their money to drachma from Euro. You need something of value to back the drachma with (not talking about real value but economic stability and Greece's economics). You need to use the converted €s for that. You can't simply just give out money for money and have twice as much at the end.
Is the pizza a metaphor for something else or is it literally pizza?
I like pizza.
[QUOTE=Jackald;35433330]Pizza is obviously a metaphor for cross price elasticity functions of the money supply as informed by the transformation system of money between microeconomies.
I mean it's really obvious guys.[/QUOTE]
Yeah! What you said!
[QUOTE=Jackald;35433330]Pizza is obviously a metaphor for cross price elasticity functions of the money supply as informed by the transformation system of money between microeconomies.
I mean it's really obvious guys.[/QUOTE]
What in the name of Darwin?
[editline]4th April 2012[/editline]
I need to play more Simcity.
"Greek people" :v:
So in essence it sounds like its a re-creation of a currency market, which in theory doesn't sound too bad of an idea. The citizens bring their Euros to the banking authority, who then gives them an equivalent amount of drachma - with the original Euros not being destroyed, but given to the government to pay back the debt. What's striking is that this would essentially double the monetary supply of Greece... an equivalent amount of drachma is created/distributed with the Euros still being used to pay back government debt. Very interesting indeed, but would this work in real life? Hard to say.
Here is how money is created (shamelessly sourced from Wikipedia on Money Creation):
[img]http://upload.wikimedia.org/wikipedia/commons/f/f2/Money-creation.gif[/img]
With the idea proposed above, it seems like the Greek government would need to 'create' or re-introduce the Drachma out of thin air. At least, this is how I see it anyways. Nonetheless it's awesome that people, even kids, are coming up with ideas that could potentially help the world in a huge way.
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