Each country should go back to its original currency.
Each cuntry will use the Euro for all international transactions.
In this way each country has the option to devalue or revalue its currency depending on its productivity relative to other countries. The local business will have to pay more or less to buy the Euro to transact international business depending on the value of its currency .
Why not! What's wrong with it? It is the only way to free all the European countries from the shackle of the common currency.
George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager
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2 comments:
Do a spell check please
Thank you.
On second thought I am not sure my idea makes much sense. Why? Because low productivity countries will have to pay more to buy Euros (due to the devaluation of their currency) when they purchase goods from other countries.
Now the end result is the same as devaluation. Why? Because interest rates of low productivity countries have risen sharply and the end result is they will have to pay more to buy Euros to pay for their imports. Same outcome. It is the same as having a devalued currency.
The bottom line is that the markets always win.
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