Sunday, January 1, 2012

10-year anniversary of the euro

We celebrate the 10-year anniversary of the Euro with thoughts of its potential break-up. Survey show that the people of the euro-zone are in not in favor of it. Governments need to change it and businesses are bracing for a break-up. There is no party.

Was this a failed experiment? Yes, it was an experiment that went too fast and too far over the last ten years. Greece never should have joined. The same applies to Portugal and Spain. Italy should have been disciplined early and there are question as to whether Ireland should have been kicked out. Ireland in a normal world should have been attached to sterling. It would have been better to start with something smaller or even with two currencies. The flaws are now well-known but the solutions require a level of political support which may not be possible. The euro is stronger than expected from its inception but it just does not seem like this is a decade worth celebrating.

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