Otmar Issing, former chief economist of the European Central Bank, warned today that the Euro's existence could be threatened unless member countries find a way to impose tougher spending curbs on one another.
Mr. Issing wrote: “With the failure to make sovereign states’ fiscal policies consistent with the conditions for the single currency area,” “policy makers not only have weakened the functioning of monetary union, but have also called into question its very survival.”
The New York Times reports that he also wrote in an email: “I have indeed become very concerned that politics fail to take the crisis as an opportunity to forcefully improve the framework” for monetary union'
Mr. Issing is former member of the board of the Bundesbank and was a key figure in the introduction of the euro.
He opposed bailing out Greece and other troubled European countries saying that that rescue of countries that have pursued bad policies “adds up to an open invitation to states to live beyond their means at the expense of others.”
"Predictions by euro skeptics have proved true", [...] “The crisis brought further evidence of a basic design flaw of monetary union, namely that we could not rely for its sound working on member countries to carry out appropriate economic policies,”
Mr. Issing also warned leaders “A political union worthy of the name cannot be set up by stealth,”, i.e, do not push policies down European throats in disguise.
Positive side
“Europe has faced repeated crises in the past and each time has emerged on the whole in stronger shape,”
But...
He concluded: “the more these tensions will endanger the existence of E.M.U.”
“My conclusion at the start of 2011 is a somber one,” “We have not yet reached the moment of truth for E.M.U. It has merely been postponed.”
Tuesday, January 11, 2011
ECB's Issing: Euro's Existence Threatened; Crisis Reveals Basic Design Flaws; Moment of Trust Postponed
Subscribe to:
Post Comments (Atom)
Blog Archive
-
▼
2011
(510)
-
▼
January
(45)
- Centamin Egypt: A Gold Producer in Egypt at Bargai...
- Chinese Agency Blasts Fed for "Eroding Ligitimacy ...
- A Trader Made $5B in Profits in 2010
- Petrobras Makes Yet New Oil Discovery
- Brazilian Unemployment: 5.3%, Lowest Ever
- New ETF for Jobless Claims
- S&P Cuts Japan's Rating: Yen Plunges
- $1 Trillion To Pour Into Emerging Markets in 2011:...
- The Two Europes: Resentment Grows Against Germany ...
- Natural Gas Prices Soar, Contango Now Benefits UNG
- Fed's Plosser: Monetary Policy Cannot Fix Unemploy...
- Looking For The Best ETFs? Brazil Boom To Continue...
- Commodities: Wheat Near Record Prices Again; Food ...
- China Steps Up Bad Mouthing of U.S. Dollar; Target...
- Why Overall U.S. Consumer Spending Has Not Collaps...
- Meredith Whitney: Beware Muni Bonds, Wave of Defau...
- Fitch Downgrades Greece to Junk Status
- Weeping in a BMW: China Pushes Consumption; Move O...
- Inflation Jumps in The U.K., Calling for Raise in ...
- Forget Peak Gold Theories: Global Gold Production ...
- Brazil, India, and China Account for 50% of World'...
- Brazil Created Over 2.5M Jobs in 2010, Will Create...
- Citi Says European Bailout Fund Needs to Be Increa...
- U.S. Banks Are Reporting Phantom $1.4T on Interest...
- Fed Buying $112B in Treasuries By February 9th
- Home Prices Drop More Than During Great Depression...
- So You Thought The Troubles Were Over: Why Markets...
- Roubini Versus Goldman Sachs, Who is Right?
- ECB's Issing: Euro's Existence Threatened; Crisis ...
- Brazil Says Currency Wars Are Now Turning Into Tra...
- Invest Wisely Where The Growth Is: World's Current...
- ADP's Huge Miss Employment Numbers Versus Governme...
- Brazilian Inflation Is The Highest in 6 Years
- Threats: Geithner Warns That U.S. Could Hit Legal ...
- Currency Wars: Brazil Fires New Salvo To Stop Drop...
- It's Sleek, It's Fast, Powerful, and Super Thin: N...
- World's Food Prices Surge To New Record Highs - Again
- Shell and Brazil's Cosan to Sell Ethanol Worldwide
- Natural Gas Shoots Higher: HNU to Jump Today; Cont...
- Currency Wars Continue: Chile Strikes Back and Buy...
- Brazil's Automobile Industry Hits New Record: 3.3M...
- Bank of America is Worried: Buys Embarassing Web S...
- PBR Jumps; Performance That Cannot Be Matched; Pre...
- China To Buy Spain's Debt to Stop European Crisis
- The Rise of The Chinese Yuan: Hits Record High; To...
-
▼
January
(45)
No comments:
Post a Comment