Except I don't think there's anyway they're gonna let 50+ years of integration go down the drain without a fight. :redface: I imagine they'd find a way to repeal Lisbon and put the previous treaties back into force (or some other arrangement to keep the EU in action).
"If euro fails then Europe fails" - Angela Merkel
- Thread starter Jason
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It is difficult to kill because it is already dead. Like the zombie. Haven't watched too many Holywood B movies - how do you kill a zombie?
Do you need a referendum? :lmao:This will be a tiny part of the legal and constitutional conundrums in every nation. Governments will (rightly) say it is a crisis and act immediately as they would in a war situation. A broader point of course is that if you are a big,powerful organisation and someone owes you money in euros, where do you sue? Brusels? Frankfurt? The capital of the first country to go, say Berlin? The capital of the country to blame - so is that Athens or Dublin? Or do you sue the people who rafted the Lisbon Treaty? There will be blame everywhere.
Legally if the euro fails the EU fails. I don't see that any wishful thinking by the Eurocrats can get round this. The EU is governed by Treaty, and if the Treaty is breached there isn't an EU. No decision will have any legal force, and there is no-one to pay the Eurocrats. And there will be very little agreement among governments as to what they will or will not sign up to subsequently.
If the euro goes the EU goes and we have a group of nation states.
The Irish have it all in their power. Just one vote short of passing their emergency budget and the blue touch paper is lit.
Do you need a referendum? :lmao:This will be a tiny part of the legal and constitutional conundrums in every nation. Governments will (rightly) say it is a crisis and act immediately as they would in a war situation. A broader point of course is that if you are a big,powerful organisation and someone owes you money in euros, where do you sue? Brusels? Frankfurt? The capital of the first country to go, say Berlin? The capital of the country to blame - so is that Athens or Dublin? Or do you sue the people who rafted the Lisbon Treaty? There will be blame everywhere.
Legally if the euro fails the EU fails. I don't see that any wishful thinking by the Eurocrats can get round this. The EU is governed by Treaty, and if the Treaty is breached there isn't an EU. No decision will have any legal force, and there is no-one to pay the Eurocrats. And there will be very little agreement among governments as to what they will or will not sign up to subsequently.
If the euro goes the EU goes and we have a group of nation states.
The Irish have it all in their power. Just one vote short of passing their emergency budget and the blue touch paper is lit.
Dunno? Doubt we'd mind tho - if it took us back to the pre-referendum situation?
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This whole economic breakdown is part of a plan by powerful interests, including international bankers, to advance a global government.
They want the economies of our nations to implode, then exploit the crisis (read: our misery) to justify their agenda, and possibly even hope that the economic turmoil would leave us so miserable that we'd beg for it -- you get enough support, and it would happen. Of course it would be promised that this government would solve all our problems, and of course it would be a lie.
When you look at the people involved, and their actions, it suggests that the global governance they seek to impose would be anything but democratic...
They want the economies of our nations to implode, then exploit the crisis (read: our misery) to justify their agenda, and possibly even hope that the economic turmoil would leave us so miserable that we'd beg for it -- you get enough support, and it would happen. Of course it would be promised that this government would solve all our problems, and of course it would be a lie.
When you look at the people involved, and their actions, it suggests that the global governance they seek to impose would be anything but democratic...
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Exactly one year ago today the Lisbon Treaty was ratified. The Europhiles felt they had achieved a significant victory.
Now we have the president the LT created speaking of a "survival crisis" for the euro, and Merkel pointing out "if the euro fails, Europe fails". Who would have believed this a year ago! The LT has been tested by the bailout crises in Greece and Ireland and found wanting as it doesn't provide an appropriate way of dealing with such. Indeed it seems that we would have more flexibility without the LT.
If EU nations were today asked to ratify Lisbon, would a single nation ratify it?
Where people were allowed a vote (France, Netherlands, Ireland) they voted against the treaty (or the earlier constitution). Opinion polls indicate that a majority of the half billion people of the EU would have voted against the LT. Is it actually possible that the people were right and the Eurocrats wrong? Could it even be that it would be better for the EU to be run as a democracy rather than an autocracy?
Now we have the president the LT created speaking of a "survival crisis" for the euro, and Merkel pointing out "if the euro fails, Europe fails". Who would have believed this a year ago! The LT has been tested by the bailout crises in Greece and Ireland and found wanting as it doesn't provide an appropriate way of dealing with such. Indeed it seems that we would have more flexibility without the LT.
If EU nations were today asked to ratify Lisbon, would a single nation ratify it?
Where people were allowed a vote (France, Netherlands, Ireland) they voted against the treaty (or the earlier constitution). Opinion polls indicate that a majority of the half billion people of the EU would have voted against the LT. Is it actually possible that the people were right and the Eurocrats wrong? Could it even be that it would be better for the EU to be run as a democracy rather than an autocracy?
Jason,
Basically as I understand it, when nations voted against the treaty, it resulted in referendum after referendum as well as veiled threats that it would adversely affect them if they didn't vote yes. Interestingly when they voted yes, there was no referendum...
Basically as I understand it, when nations voted against the treaty, it resulted in referendum after referendum as well as veiled threats that it would adversely affect them if they didn't vote yes. Interestingly when they voted yes, there was no referendum...
It was the autocrats, if I'm not mistaken, that convinced/coerced the Germans to give up the mark. Germans, I'm told, loved the mark and where proud of it's strength. And now they're in the situation of bailing out the Euro which they never really wanted. A bitter pill indeed.
Drifterwood
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Putting politcal positions to one side, Jase, I would say that anyone would be in trouble if you suddenly doubled the cost of something they had become dependent upon.
Without Fiscal Union, some fiscally independent Nation States have become sitting ducks in the limbo that the Euro has left them. Whilst everything was hunkydory, the cracks could be papered over; cracks I should say that were inherent within the management of those Nation States.
If you wish to be conspiratorial, then either this game has been initiated to force fiscal union, or to destroy the threat of the Euro. Either which way, the status quo can not remain.
I would agree with you that someone seems to have decided it is time to whip up some panic. Now I dont believe thatthey believe the outcome of this will be less EU.
If you men put it to a vote, I dont think most of them would have last time
THeres an interesting idea. The UK would have to surrender its vetoes, as would all the other countries. Britain would be in the position which the anti EU lot claim it is in now. The EU is run by the member countries acting together sitting round a table and always has been. It is now more undemocratic than is the british cabinet. When did they ever ask the people what they want?
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ECB's statement this afternoon has not been well received. The markets hoped for an announcement that the ECB would buy bonds from the periphery countries. But the ECB said they wouldn't! They also kept the benchmark interest rate at 1% - markets would have liked 0.5%.
Buying bonds would of course be quantitative easing, and Trichet restated the ECB's anti-inflation policy, which he called a "doctrine". Now of course there are major problems with quantitative easing, but there are times when there is really no alternative - and this is probably one.
The markets turned abruptly as he spoke - increased insurance costs for Spanish and Portuguese bonds, and stockmarkets across the eurozone dipping.
Buying bonds would of course be quantitative easing, and Trichet restated the ECB's anti-inflation policy, which he called a "doctrine". Now of course there are major problems with quantitative easing, but there are times when there is really no alternative - and this is probably one.
The markets turned abruptly as he spoke - increased insurance costs for Spanish and Portuguese bonds, and stockmarkets across the eurozone dipping.
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I've just realised it is not quite as simple as above. Top two Google latest results at 16.35
ECB resists new crisis measures: Fin24: Economy
2 Dec 2010 ... ECB resists new crisis measures: Fin24: Economy. The European Central Banks extended its liquidity safety net for vulnerable banks but did ...
www.fin24.com/.../ECB-resists-new-crisis-measures-20101202 - South Africa - 28
28 seconds ago
ECB extends special crisis measures - Forbes.com
2 Dec 2010 ... "This gave the impression of increased activity on behalf of the ECB in those markets," said Elwin de Groot, an economist at Rabobank ...
www.forbes.com/feeds/.../general-eu-europe-financial-crisis_8177287.html - 43
There are also reports of the euro going both up and down (in fact its going round in circles).
Curiously we have an ambiguous result from the ECB. But I think it is fair to say that it has done no more than contribute to the uncertainty. This isn't a solution.
ECB resists new crisis measures: Fin24: Economy
2 Dec 2010 ... ECB resists new crisis measures: Fin24: Economy. The European Central Banks extended its liquidity safety net for vulnerable banks but did ...
www.fin24.com/.../ECB-resists-new-crisis-measures-20101202 - South Africa - 28
28 seconds ago
ECB extends special crisis measures - Forbes.com
2 Dec 2010 ... "This gave the impression of increased activity on behalf of the ECB in those markets," said Elwin de Groot, an economist at Rabobank ...
www.forbes.com/feeds/.../general-eu-europe-financial-crisis_8177287.html - 43
There are also reports of the euro going both up and down (in fact its going round in circles).
Curiously we have an ambiguous result from the ECB. But I think it is fair to say that it has done no more than contribute to the uncertainty. This isn't a solution.
Drifterwood
Superior Member
The Economist's viewpoint:
The future of the euro: Don't do it | The Economist
It's looking more like a fait accompli.
Ultimately the richer Euro countries should just be weighing up ust how much they're willing to fill up financial institutions pockets before cutting & running.
It's potentially the Black Wednesday situation all over again. Soros will be rubbing his hands in glee. Perhaps he'll buy another country!
The future of the euro: Don't do it | The Economist
It's looking more like a fait accompli.
Ultimately the richer Euro countries should just be weighing up ust how much they're willing to fill up financial institutions pockets before cutting & running.
It's potentially the Black Wednesday situation all over again. Soros will be rubbing his hands in glee. Perhaps he'll buy another country!
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Nice article Crackoff.
A month ago no-one would have believed a publication as sound as The Economist would be running such an article. A year ago the Lisbon Treaty had just been ratified and the Eurocrats felt they were invincible. The surprising thing with this story is how fast it is running.
Round-up
GREECE: Basket case. Bailouts have failed - no way out from debt spiral.
IRELAND: About to follow Greece (assuming idiot politicians vote through 7th Dec budget). Govt falling.
PORTUGAL: markets are sure there will be a bailout
SPAIN: If Portugal goes Spain must too, but it's unthinkable so it won't happen - markets not thinking straight.
ITALY: We're not even thinking this far. But when markets move it will be quick.
BELGIUM: Markets moving sharply against a country in drift.
NETHERLANDS: Govt may fall over Ireland bail-out.
FRANCE: Economy not actually looking all that good.
GERMANY: Distress over bailouts.
The Economist points out that it is just expensive if the euro goes, not unthinkable. What it doesn't explore is that the expense is uneven. If Germany jumps first then Germany does okay - and indeed the periphery. Worst hit is France. Nor does it point out that there is a political cost over and above the economic cost. For the German government staying in the euro now has political costs.
Seems to me that the decision will be made by Germany on Germany's timetable. It also seems to me that Germany may have respoded to the Irish crisis by bringing forward its action.
A month ago no-one would have believed a publication as sound as The Economist would be running such an article. A year ago the Lisbon Treaty had just been ratified and the Eurocrats felt they were invincible. The surprising thing with this story is how fast it is running.
Round-up
GREECE: Basket case. Bailouts have failed - no way out from debt spiral.
IRELAND: About to follow Greece (assuming idiot politicians vote through 7th Dec budget). Govt falling.
PORTUGAL: markets are sure there will be a bailout
SPAIN: If Portugal goes Spain must too, but it's unthinkable so it won't happen - markets not thinking straight.
ITALY: We're not even thinking this far. But when markets move it will be quick.
BELGIUM: Markets moving sharply against a country in drift.
NETHERLANDS: Govt may fall over Ireland bail-out.
FRANCE: Economy not actually looking all that good.
GERMANY: Distress over bailouts.
The Economist points out that it is just expensive if the euro goes, not unthinkable. What it doesn't explore is that the expense is uneven. If Germany jumps first then Germany does okay - and indeed the periphery. Worst hit is France. Nor does it point out that there is a political cost over and above the economic cost. For the German government staying in the euro now has political costs.
Seems to me that the decision will be made by Germany on Germany's timetable. It also seems to me that Germany may have respoded to the Irish crisis by bringing forward its action.
the tag at the end of the article is 'breaking up the euro is not unthinkable, just very costly'. But the whole article argues it is so costly it just isnt going to happen. Is your point simply that they are discussing the relative merits?
The euro is designed to be bomb proof. It also amuses me that we are getting 'oh my god, euro falls in value' headlines. Isnt this what everyone anti euro has been saying is necessary? It also noted the last thing Germany wants is a brand new mark appreciating in value like crazy. It would kill the german economy. Germany leaves the euro and dies.
The euro is designed to be bomb proof. It also amuses me that we are getting 'oh my god, euro falls in value' headlines. Isnt this what everyone anti euro has been saying is necessary? It also noted the last thing Germany wants is a brand new mark appreciating in value like crazy. It would kill the german economy. Germany leaves the euro and dies.
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Germany is getting an export bonanza through a currency that is too weak for that country. It is also facing import costs (including oil and gas) that are higher than they should be. It is tending to overheat - inflation is a risk. The economic case for Germany is mixed. In the end there is a "right" level for a country and a currency either too high or too low is a problem. Germany wouldn't die outside the euro - and it may even be the one economy that escapes most of the costs of leaving.
Germany is facing an increasing political backlash. Most German voters (as voters anywhere) have precious little understanding of economics, but Germany giving big bailouts is a hard one to sell to the electorate. Many alive in Germany remember hyperinflation, and there's a real sense that a safe currency is an absolute demand, and whispers of euro problems are causing political trouble. Politically an end to bailouts and a move onto a new DM would sell.
Germany will be the country that makes the decision - and Germany could pull the rug from beneath the euro at any time. There are both economic and political arguments for doing just this (and indeed for not doing this).
The euro is trending down. Curiously it helps no-one. Greece, the basket case, would need a catastrophic drop in the euro to even register on its problems, basically to get Greece back to a position where it can service its debts. Ireland and Portugal, even Spain and Italy, need drops far bigger than are now happening to actually help them. A decline by a percent or two (or even ten) doesn't really help the periphery but further overheats Germany. A decline of 20-40% (which is what the periphery needs) would overheat Germany and France and others to boiling point.
IMO the bind for the euro is that a fall in value is now too late. Indeed the disadvantages (investors dumping euro-denominated stock, particularly in the periphery) will cause more problems for the periphery. I don't see that any currency valuation answer works now - presumably the best option would be to keep the euro steady. It seems that as of yesterday the ECB has persuaded speculators that there is money to be made for a few more months, but it solves nothing - and the pundits managed to give both the good news and the bad news.
Germany is facing an increasing political backlash. Most German voters (as voters anywhere) have precious little understanding of economics, but Germany giving big bailouts is a hard one to sell to the electorate. Many alive in Germany remember hyperinflation, and there's a real sense that a safe currency is an absolute demand, and whispers of euro problems are causing political trouble. Politically an end to bailouts and a move onto a new DM would sell.
Germany will be the country that makes the decision - and Germany could pull the rug from beneath the euro at any time. There are both economic and political arguments for doing just this (and indeed for not doing this).
The euro is trending down. Curiously it helps no-one. Greece, the basket case, would need a catastrophic drop in the euro to even register on its problems, basically to get Greece back to a position where it can service its debts. Ireland and Portugal, even Spain and Italy, need drops far bigger than are now happening to actually help them. A decline by a percent or two (or even ten) doesn't really help the periphery but further overheats Germany. A decline of 20-40% (which is what the periphery needs) would overheat Germany and France and others to boiling point.
IMO the bind for the euro is that a fall in value is now too late. Indeed the disadvantages (investors dumping euro-denominated stock, particularly in the periphery) will cause more problems for the periphery. I don't see that any currency valuation answer works now - presumably the best option would be to keep the euro steady. It seems that as of yesterday the ECB has persuaded speculators that there is money to be made for a few more months, but it solves nothing - and the pundits managed to give both the good news and the bad news.
You said it jase. A modest fall in currency is neither here nor there for Greece or Ireland. They are still running because of bailouts. They are still running BECAUSE they are part of the euro. I agree it depends on what Germany decides to do. I do not agree there is a 'right' level for a countries currency. A floating currency naturally adjusts but the factors which cause it to move have little to do with what is right for that country. A country like that has little control over its currency. Economists have come to regard a floating currency as a tool rather than a consequence. The calculations and mindset need to start from the idea that the currency will be stable.
I really dont know what you think would happen to europe in the wake of a euro collapse. I rather think it would precipitate a depression.
I really dont know what you think would happen to europe in the wake of a euro collapse. I rather think it would precipitate a depression.
I'm not sure where we are on the numbering, but it would also be the end of the 5th reich and a turning back from the path to imperial europe. You think the Germans will be quite so happy about that? A mark would be a weaker currency than the euro, and there would still be the need to bail out the rest of europe. That problem isnt going to go away.
You think the Irish economy could survive 30% inflation?
no, I see you agree about that. The only course is the current one of a modest fall.
come, now, many things are solved by eternal procrastination. Everyone is still stalling for time to regularise difficult positions.
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I don't think anyone knows. And we have no previous currency union failure on this scale to look at for comparables. My view remains that it will happen (whatever anyone now does) so I guess we will inevitably find out.
There is certainly the view that it will cause a depression. I think this is a real risk - but I don't see it as a certainty. Indeed this is why I think it is crucial that the process is managed, and I hope Germany and the ECB are buying time now precisely in order to manage the inevitable. Some large currency unions have unravelled without depressions or even recessions, so I think there is room for hope.
At the edges I think it is just about possible that Greece could be cut adrift and the markets not panic - they really have written off Greece. Possibly Ireland as well. The problems are more legal than economic. What seems a better (but not perfect) option both legally and economically is for Germany to float a currency. And I think with a proper lead period this could be done in a way that made the markets happy, but it has to be a plan, not an emergency process. Germany is leaking the idea (and not denying it) so it is out there and people are getting used to it. I think the markets are being prepared. Maybe other countries would go with Germany. So yes I think the top and the bottom could be resolved without catastrophe. Then suddenly the middle, basically France, Spain/Portugal and Italy looks as if solutions can be found. Maybe France would go with Germany. Maybe Sp/P and Italy could make a Latin euro work - their economies are reasonably in step.
Of course an end to the euro is an end to the Lisbon Treaty as the euro is written throughout that treaty - and Lisbon replaces all other treaties so there is no fall-back, and the EU indeed fails. Some sort of new European framework would need to be negotiated and with nation states signing in (or otherwise). But it isn't going to look like the EU.
