Monday, January 16, 2012

Solution to the Euro crisis? Keep the Euro, and introduce the drachma, lire etc.

The creation of parallel European currencies is the only credible solution to the problems of the eurozone

An idea that keeps popping up without getting the attention it deserves... Proposes that instead of leaving the Euro, the countries with exploding debts and junk bond status re-issue their own currencies and run them parallel to the Euro. Despite this coming from a conservative, and the vomitable name of the blog, I think this is a sound idea ;-) Debts would remain euro denominated or would be defaulted in a more orderly fashion. I would add that so long as the new currencies are acceptable to national governments as payment of taxes, there should be no problem with their acceptability as a unit of account and medium of exchange. Why should someone not accept them if you can pay your taxes with them?

Posted by nickb @ 11:07 AM (1508 views)
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7 thoughts on “Solution to the Euro crisis? Keep the Euro, and introduce the drachma, lire etc.

  • mark wadsworth says:

    Don’t knock ConHome, they allow all sorts of people to write articles (including little me). And I agree with the general idea of reintroducing the old currencies.

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  • Sorry Mark, but I saw a picture of Michael Gove this morning. I’m sure you understand really…

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  • mark wadsworth says:

    He’s all right, is Gove. He’s one of a small number of Tories where I don’t disagree with most of what he says.

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  • Really? Personally I think he is a prize chump. His latest lunatic suggestion is to buy the queen a £60m yacht for her jubilee present, at taxpayers’ expense.
    N

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  • Gove seems to be willing to do or say anything to get into a position of power.

    Here he is on a picket line before he underwent political gender reassignment.

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  • Thinking of European currencies and Interest rates:

    S&P have just downgraded the bailout fund! Doh!

    The downgrade could affect the EFSF’s ability to raise money cheaply. The idea of the EFSF was for countries with top credit ratings to borrow money cheaply that they could then lend on to countries that were struggling.

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  • Fubar
    Great find… who’d have thunk it?
    N

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