jump to navigation

Germany’s Currency Nostalgia Is Badly Off the Mark September 12, 2012

Posted by proeconomia in Fiscal policy, Main, Monetary policy, News on Greece, On the crisis, Opinion.
trackback

An articlefrom Clive Cook @ Bloomberg, who has given us some interesting opinions in the past. Have a look at it. Here is an interesting excerpt of the truth of the thing:

“… But surrendering the deutsche mark (and before that, fixing their currency’s value relative to other European currencies) gave them an export performance and enormous balance-of-payments surpluses that they otherwise wouldn’t have enjoyed. And let’s not forget those surpluses were recycled as unsafe lending to Europe’s weaklings. It takes bad lending as well as bad borrowing to build a debt crisis. The bailouts that German taxpayers resent so bitterly were necessary partly to protect Germany’s undercapitalized banks from the consequences of their own actions. So far, the division of the burden of adjustment between bad borrowers and bad creditors has been much to Germany’s advantage. The Irish economy was crushed to keep creditors whole. Ask the Irish who has been treated unfairly.”

Advertisements

Comments»

No comments yet — be the first.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: