This is an interesting short article from Alan Beatie at the Financial Times.
It argues that the controlled depreciation of the Euro to other major economies’ currencies is a healthy thing, citing IMF evidence emerging from a working paper based upon the experience of South Korea emerging from the 2008 crisis. The working paper makes interesting reading too but be warned it contains econometric models!
Many foreign exchange commentators are looking to further depreciation of the Euro, as well.
The question that are left in my mind include:
- If the Euro continues to fall against other major trading currencies, surely that will be enormously advantages to Germany because it is an export driven economy?
- Has Germany engineered an erosion of the Euro to stimulate its own growth in exports?
- The unprecedented behaviour of the central banks | Gavyn Davies | Insight into macroeconomics and the financial markets from the Financial Times – FT.com (dralfoldman.wordpress.com)
- Mechanics of a euro breakdown (ftalphaville.ft.com)
- Why Germany Won’t Let The Euro Collapse… (businessinsider.com)
- Euro *non*-redenomination risk (ftalphaville.ft.com)
- FT podcast: World Weekly (blogs.ft.com)
- The falling euro and the crisis that wasn’t (blogs.ft.com)
- Downgrade nation (blogs.ft.com)
- Europe: Fiscal union or bust? (investmentpostcards.com)
- Jobless data show twin-speed Europe – FT.com (dralfoldman.wordpress.com)
- Year-end bets against euro hit record (cnn.com)
- Germany has to make a fateful choice – FT.com (wpvins.wordpress.com)
- Eurozone crisis: live blog (blogs.ft.com)
- Businesses Plan for End of Euro (therepublika.com)
- FT column: Why I’m feeling strangely Austrian (ft.com)