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If Germany left the eurozone

Stephanie Flanders | 10:55 UK time, Friday, 3 December 2010

It may be unthinkable, but I'm not the only one thinking about it. Since my last post, both Capital Economics and Graham Turner of GFC Economics have independently put some numbers together to see what we'd be talking about if Germany took the high road out of the euro. The results are suggestive, to say the least.

As I discussed before, there would be a big upfront financial and an economic cost of Germany leaving the single currency - not to mention an enormous political price for walking away from a project in which so much has been invested.

The major economic cost would be the hit to competitiveness, because the new German currency would surely go up. It's up for debate how much this would force the much talked about rebalancing of the German economy. Listening to Germany's politicians and industrialists, you would expect it to have very little impact: in the world market, they tend to argue, German companies compete on quality, not price.

But there is no debate about what a revaluation against the rest of the world would do to Germany's national balance sheet. It would hurt. Capital Economics has come up with a back-of-the-envelope calculation - with a fairly sophisticated envelope.

Chart showing net international assets (% GDP 2009)

It assumes that the new German currency would appreciate by 20%, which is roughly how much German industry has increased its competitiveness relative to the rest of Europe since 1995. Then it asks what that would mean for the value of Germany's net foreign assets - which, as the chart shows, are pretty large. Their answer is that a 20% appreciation would reduce the value of those assets by about E160bn, or 7% of German GDP.

Chart showing possible losses on international debt and assets (% GDP)

That is a big hit. But remember that German creditors will also take a hit if these countries ultimately have to default. As the second chart shows, 7% of GDP looks manageable compared to the price that Greece or Portugal would pay, if they were forced out of the euro, and their domestic economy subsequently depreciated by 20-25%. (Though, as I said earlier, precisely for that reason, you would expect them to restructure in that instance as well.)

It's interesting to compare these numbers with the massive positive shift in the UK's balance sheet after the pound fell by 25%, on a trade weighted basis, in 2008. By the end of 2008, net foreign liabilities of £352bn had turned into net foreign assets of £92bn - even though we ran a balance of payments deficit throughout and exporters had not even begun to start taking advantage of the lower pound. Amazing what a little - OK, a large - depreciation can do.

Of course, it is precisely because they can't restore their national balance sheet and competitiveness the old fashioned way that Greece and the rest are now facing such a miserable few years within the euro.

But what if Germany left, what would the new eurozone look like? Graham Turner has done those numbers: he reckons that, without Germany, the euro area would have had a current account deficit of 1.9% of GDP in 2009. With Germany, there was a slight surplus of 0.6% of GDP.

Interestingly, the budget numbers would not be all that different. With Germany, the average budget deficit across the single currency area was 6.3% of GDP last year, and the average public debt ratio was 79.2% of GDP. Without Germany, the deficit would have been 7.5% and the debt ratio just slightly higher, at just over 81% of GDP.

Looked at that way, you wonder whether the periphery would get the depreciation they would need if only Germany left. Investors might not think the new euro looked very different from the old.

But imagine, as I suggested previously, that the other major surplus countries (Austria, the Netherlands and Finland) all joined Germany in this implausible departure scenario: then the average current account deficit outside this new DM bloc would rise to 3.4% of GDP. In Graham Turner's view, these remaining countries could enjoy lower borrowing rates, "if investors thought that a weaker exchange rate gave them a better chance of growing again".

Of course, there would be enormous legal and practical obstacles - but, as Capital Economics notes, these don't look insurmountable. And managing the status quo is not exactly a walk in the park.

The better reason to doubt that any of this will happen is that in European politics, governments rarely take the radical way out of a crisis when there's an incremental alternative, even if they both end up costing the same in the end. It's much more likely that countries like Germany will progressively contribute more taxpayer funds to supporting the euro with its current membership, and hope that their populations won't take to the streets.

Put it another way, the current European leadership have tended to put the "grand European narrative" before economics in their approach to European integration. But if they did put economics before everything else, what these numbers show is that a German exit from the euro might now be the best option available.

Comments

Page 1 of 2

  • Comment number 1.

    The better reason to doubt that any of this will happen is that in European politics, governments rarely take the radical way out of a crisis when there's an incremental alternative.

    Thats the problem, will the incremental alternative not be side lined by some major change forcing an uncontrolled collapse of this unstable union.

  • Comment number 2.

    Germany will not exit at the moment from the EU. That is a fact.

    Chancellor Merkel has invested too much in saving the Euro and the German people are NOT in a mood to see good money thrown after bad.

    The Euro will remain at least for the next 5 years.

    However the European Commission in Brussels must now show a comprehensive determination to manage the Euro as an international currency. For them, it is better to spend the current EU budget on employing people who understand international finance, and restrain from financing 'wind farms in Latvia'.

    The survival of the Euro and the Eurozone is dependent on the management of the Euro and how this management is perceived by the international community.

    My first thought is to sack most of the commissioners in their nice new offices in Brussels, and bring in international financiers who understand the real world. Many of these commissioners are simply not up to the job of managing this crisis.

    Also, please, get rid of these 'no-bodies' who are only there because of the Lisbon Treaty!

  • Comment number 3.

    This is a battle! On the one side, the Euro-politicians with their vision of a United States of Europe, on the other, the economists and the markets. I believe the pols will pay ANY PRICE to keep their vision on track. That includes making sure real people don't get a chance to express their views in any sort of vote. The Germans, unlike the French, are not keen to take to the streets and for that reason, my bet is that Germany will be the main,albeit reluctant, milch cow.

    I also believe we will be hearing much more (misguided) talk about "Harmonsation". The Irish, contrary to many predictions, seem to have got away with their 12.5% Corporation Tax. Harmonisation, I believe, would be the kiss of death, with tax levels set to accomodate the least efficient, and eliminating any element of competition as a spur to greater efficiency and competitiveness in world markets. But then the Euro Visionaries don't know (or don't care) about such trifles.

  • Comment number 4.

    Stephanie,

    Your "hope that populations won't take to the streets" in your last-but-one paragraph puts the finger on the right problems. Numbers and rational calculations are all right. But the big uncertainty is whether Joe Public will accept to be taxed to death when he feels no responsibility, when some banks boast huge profits,and when politicians multiply reassuring declarations for "the markets".
    Governments must pray for the current weather to last a while.

  • Comment number 5.

    Stephanie,

    Why do you give credence to the nuke-self option? They will only benefit bankers.

    Europe needs one currency. It has one. Why do you think that the bankers want to destroy it? Can this be for anything except their naked self interest? Have we forgotten the economic destruction that the very same bankers unleashed upon us a couple of years ago?

    We should join the Euro. We need to be inside the single currency. The only part of the economy to benefit by either destroying the Euro, or keeping the UK out, is the bankers. The jingoistic Little Englander xenophobes MUST be stopped, and we must remind that that the bankers destroyed the country. Bankers (and their economists) are not just part of the problem - they are the problem!

    And don't say that economists think that destroying Europe is a good idea for it is these very same economists that justified the bankers and took an active role in destroying the Nation in the last decade. Why do you and we still listen to these proven and self confessed idiots? We must expunge their insane self-serving ideas!

  • Comment number 6.

    Sorry Steph but there is no way Germany is leaving the Euro, they might evict all the other members but without Germany the Euro is dead.

    I think it more likely that portions of the european banking/finance industry will be nationalised and then europeanised and funded directly by the ECB freeing national governments from the stranglehold of private debt. (national governments will still have to struggle with their own debt problems)

  • Comment number 7.

    Perhaps the best way to look at Germany's exit from the Euro is to look at similar examples from history & geography :
    1. Within the USA, the Civil War on the 1860s was similar with the Industrial North pulling away from the PIIGs in the South. Eventually the disaster was averted as it was in the interest of neither.
    2. Within Europe, Britain pulled away from the PIIGS in Europe in 1688 politically speaking having created the Church of England to escape the Roman embrace. The resulting creation of America, Canada, Australia were a direct result of the 1688 decision.
    3. Within the British Commonwealth, with independence for the colonies the key mega-trend, Britain pulled away from India et al after the War in 1945. Sterling used to be the common currency. The Rupee devalued down from 7.5 to 75 to one pound.Britain suffered a loss of position in the world order from which she never recovered. So, both Britain and India lost - each in their own way.
    4. Within the 'West' politically carved - NATO - in 1945, differences led to France walking away along with Germany to create the European Union. The confrontation in 1971 over gold convertibility led to Nixon & Kissinger creating the Pacific partnerships with China et al.
    5. When USSR collapsed in 1991, Russia pulled away and emerged faster and perhaps stronger than the other 'Stans'.

    And finally, when Martin Luther broke away from the embrace of the Holy Roman Empire, German determination to succeed irresepctive of the PIIGS became the rallying cry for the 'Fatherland'.

    So, Germany leaving the Euro will hurt both - Germany, like Russia, will remain strong.
    The PIIGS-land will losse its currency value - probably by 30 %. But then it will learn to live in the real world. Nothing wrong with that - in fact probably the best course eventually.
    The PIIGS will loose their reserve currency capacity - they will no longer be able to stuff others with their worthless Euros.
    Germany will create new alliances following its departure - with America & Russia principally perhaps along with Britain (plus Canada/Australia), perhaps also with America's Pacific partners Japan & China.
    In the long run, say 50 years to next meltdown, Germany , Russia, Britain will stand on their own while the PIIGS-union will become more like Latin America is to Nord America. The PIIGS-union will inch closer to 'Eurabia' given their ClubMed proclivity.
    Sooner reality emerges the better.
    Bottomline - the Euro will loose value, if Germany leaves.
    Bottomline - new alliances will take shape.

  • Comment number 8.

    "20%, which is roughly how much German industry has increased its competitiveness relative to the rest of Europe since 1995."

    The current situation is obviously unsustainable. So what alternatives are there other than Germany leaving the Euro?

    1. German companies raise wages by 20% to remove their competative advangate (and see an accompanying increase in home-produced prices)

    2. Germany introduces an export tariff on its own exports and uses the procedes to cut domestic taxation

    3. Everyone else introduces an import tariff on German exports, and uses the proceeds to write off some of their their debts.

    4. Germany gets its banks to voluntarily write off debts to other EU countries, and then the German taxpayer has to bail out their banks. This would then have to be repeated every few years.

    5. Other EU countries default on their debts (to the German banks), and the German taxpayer has to bail out their banks. This would then have to be repeated every few years.

    6, Germany taxes its own people every year and gives the money to other EU states to pay off the debts that they keep on building up.

    Plenty of options, all fairly mad. I expect that they will go with (6), though it's hardly going to be popular with the German electorate.

  • Comment number 9.

    There are other factors at play in a proper examination of Germany's position at this time. For example one might look at what it is costing her to issue new debt. According to notayesmanseconomics.
    "In an interesting development the German ten-year bund saw its yield rise too by 0.12% to 2.80%. Germany had a bund auction yesterday and for the second time in a fortnight it struggled somewhat. Should this trend continue and the German taxpayer becomes aware of this ( that there is an explicit cost to the bailouts right now), there could be further trouble for the Euro zone’s plans."
    If we go back to the beginning of September Germany was having to pay some 0.5% less on its debt.So it is starting to look as if their is a cost to all the money Europe is borrowing,in effect, on Germany's credit rating.
    http://notayesmanseconomics.wordpress.com

  • Comment number 10.

    With all due respect , this is total rubbish . This is wishful thinking coming from investment banks and hedge funds who are dreaming of reaping even more profits than they already have . Such a move would plunge most European economies into chaos with the following results : a) Germany would come out as the bad guy and b) German exports to the rest of Europe would plummet , Not to mention that this would be a fatal blow to EU's credibility for the next 20 years or so . You can say whatever you like about the Germans , but stupid they are not .
    And by the way Stephanie , could you tell us what Capital Economics and GFC Economics think of the Federal Bank printing trillions of dollars or the Bank of England printing hundreds of billions of pounds ? It would make for a most interesting reading .

  • Comment number 11.

    #5 JFH

    Well said young man!

    Wasn't it in the Italian Job - We are the self preservation society?

    But as I have previously said - It takes guts to get off (out of) a moving Merry go round (money go one way)

  • Comment number 12.

    7. At 12:19pm on 03 Dec 2010, PlanetEnglish wrote:
    Perhaps the best way to look at Germany's exit from the Euro is to look at similar examples from history & geography :
    1. Within the USA, the Civil War on the 1860s was similar with the Industrial North pulling away from the PIIGs in the South. Eventually the disaster was averted as it was in the interest of neither.
    ===========================
    I,m not sure that 'the disaster was averted'. I thought that about a million people were killed in the Civil War, which some people think is still going on.

  • Comment number 13.

    An interesting analysis that raises far more questions than it answers.

    Some of the assumptions made have to be challenged. Should Germany take the decision to leave, it assumes that its trading relationships with its former Eurozone partners would continue unaltered. That cannot be rationally assumed as the cost of German imports to them would rise significantly. It must also be remembered that the bulk of those exports are items where Germany does not have any quality advantage.

    If Germany stays in the Euro then it will be called upon more and more to use its resources to fund the bailouts. How will the average Kurt and Gerda accept that - especially when they see resistance from the bailees to accept percieved subordination of their sovereignty.

    There has been plenty of talk on here about the essential base of both the Euro and the EU. Perhaps we will now see from all of the governments just how far they are preapred to go in support of a political ideal.

  • Comment number 14.

    The question is, what event is actually capable of triggering the euro collapse. In other words, why has it not happened already, despite the fact that it is clearly in the interest of the German people, the largest and most economically powerful members of the bloc.

    The answer is that there is no civil unrest in Germany, and the politicans self-interest has little or no interest otherwise. A manager always needs something to manage. A Euro politican needs a Euro, otherwise they are unemployed.

    So, we can ask ourselves what is the likely proximal cause of the euro dissolution, in the same way as the assassination of the Archduke Ferdinand "caused" WW I

    Historically, usually the tipping point is ~25-30% unemployment / starvation poverty required for the Strong Men and military juntas of Europe to take charge. Current unemployment maxes out in Spain at 20%, which just isn't bad enough (yet). British unemployment maxed at ~20% in the 30's, which caused limited unrest but did not bring down the state.

    So exit from the Euro is really fairly accurately predictable - when unemployment reaches 25-30% in one or more of the countries, that will trigger. And because that will not be Germany first, although that would be a more orderly unwinding, then we can be pretty sure that will not be the trigger.

    None of the small countries like Greece, Portugal, Belgium, Ireland, have sufficient liability to break the euro, even if they collectively default.

    It has to be either Spain or Italy. The default of Spain on its own still isn't big enough. But it will bring down Italy, and that will break the euro. So we are looking for an event that could bring Spain's unemployment from 20% today to 25-30%. By quantity, Spain's industries are (ranked from top to bottom)

    textiles and apparel (including footwear), food and beverages, metals and metal manufactures, chemicals, shipbuilding, automobiles, machine tools, tourism, clay and refractory products, footwear, pharmaceuticals, medical equipment

    The most volatile are metals, automobiles, tourism.
    So, to predict the fall of the euro to within 6-12 months, look for either - consecutive very bad wet summers in the Mediterannean (hits Italy simultaneously). Predictable next La Nina event ~2012-2013.

    , or the end of the current metals commodity bubble. The latter occurs when China makes either major new finds on its own soil (3-5 year lead-time), or sends "military advisers" to help defend its acquisitions in Congo etc. I would suggest 2013-2014. Civil unrest lags by 1 year, installation of a military junta by another year, and dismantling of the euro by a further 6 months.

    My prediction: I am reasonably confident that the Euro will not collapse before the end of 2013 (inertia), but the chances of it surviving 2015/2016 are probably fairly negligible.



  • Comment number 15.

    Couple of problems with Stephanie Flander's analysis:

    a) What about the effect on German banks if PIIG countries did default
    b) What about the effect on Germany if there was a federalised bond market?

    Seems to me that Germany is going to go with b) if at least because of the unemployment levels that a Deutschmark surplus would cause, and many other reasons to do with consolidated energy buying, Russia etc...

    A more useful analysis would have been on the topic "If the UK joined the Eurozone" and a far more likely scenario too.


  • Comment number 16.

    I fully agree with aegean ghost.

    Let's please return the topic to the fact that UK debt is at 7.5 trillion pounds and at 540% of GDP.

    When do we wish to join the Euro? After the UK sovereign default or before?

  • Comment number 17.

    Shame Capital Economics didn't explain their "fairly sophisticated envelope" because their conclusions look contradictory to me in a couple of cases.

    Still, no matter, because neither Germany nor any other eurozone country will have much choice.

    The head of the IMF, Strauss-Kahn, said that Greece and Ireland are on the lip of the abyss and Portugal, Spain and Italy are approaching it and if he is right, it won't be long before the whole tottering house of cards comes down.

    Some other posters have commented on likely outcomes if Germany were to dump the Euro, and I won't add to those views.

    I will confine myself to mocking those who continue to talk up the single currency and call for the UK to join:

    Foolish fellows, we are witnessing the death throes of a mis-conceived, egotistical, politically-engendered abomination.

    The sooner it's buried in the annals of history the better.

  • Comment number 18.

    5. At 12:07pm on 03 Dec 2010, John_from_Hendon wrote:
    Europe needs one currency

    Europe does not need one currency.
    It could have one and the criteria originally set out to allow countries into the Euro was not followed resulting in a system with flaws that were known about.
    It is the politicians who pushed and allowed a union between countries that did not qualify and has resulted in the mess they have now. It is not just the fault of the Euro but the underlying problems would come to light when some economic storm hit - from internal or external sources.

    The Banks should take blame and so should the politicians with their central Banks who have also manipulated the markets.

    The Community Reinvestment Act, a Jimmy Carter Law, was reinvigorated by Clinton. It opened the banks to law suits if they did not lend money to minorities in high enough numbers to satisfy the regulators.

    The "CRA" pushed for lower lending standards, supported by the political establishment and all was OK so long as house prices continued to rise. Bear Stearns, a major underwriter of mortgage-backed securities, argued for the soundness of CRA loans and that they "do not fit neatly into the standard credit score framework."

    The problem was that everyone was seen to be a winner. The same cavalier approach to risk assessment that informed the CRA pervaded the whole mortgage-lending arena. The Feds credit creating powers then helped feed frenzies like the housing bubble. AccuBanc Mortgage was forced to make loans of $2.1 billion in mortgages when it lost a discrimination case under the more relaxed lending criteria. Andrew Cuomo, who served under Clinton stated that "the institution would take a greater risk on these mortgages....give families mortgages they would not have given to otherwise.....and I am sure there will be a higher default rate on these mortgages."

    So did we end up with a situation where unscrupulous lenders could dishonestly force sub-prime mortgages with unfavourable or complicated terms on helpless and uneducated borrowers (lets include some investors in here as well), and was there political pressure to encourage sub-prime loans. YEP!

    Lets not forget Bush who in 2004 urged the Federal Housing Administration to lift the down-payment requirement on new home owners. With the Fed did he help keep interest rates at artificially low levels?

    In 2003 Greenspan stated there was no housing bubble and the notion of a nationwide fall in house prices was unlikely.

    We can all now see the damage that this "unforseen" housing bubble has inflicted and it has helped expose the inherent failings in the common currency. Those potential failings were seen - which is why, originally, there was an entry criteria for the Euro. If only it had been followed!

    If you wanted to start on a journey to a common currency, or join one, may I suggest you would not start from here.

  • Comment number 19.

    @5

    I disagree. I'm not Euro-phobic at all but there is a fundamental flaw in the currency. You cannot have monetary union without fiscal union, Ireland is a perfect example of that where low taxes created a business boom and inflation levels the Irish couldn't control, culminating in a massive asset bubble, now burst.

    Of all the currencies left in Europe the Sterling is the most capable of staying independent and until someone decides to create a United States of Europe I can't see a compelling reason to join.

  • Comment number 20.

    6. At 12:16pm on 03 Dec 2010, BobRocket wrote:

    Sorry Steph but there is no way Germany is leaving the Euro, they might evict all the other members but without Germany the Euro is dead.
    -------------------------------

    As I read the above article Ms Flanders is simply giving a view that a German departure from the euro might be the best option at the moment and in the light of available facts. So it might to solve the immediate problems and to maintain a cohesive EU for trade etc. If it did happen, I doubt that a new euro would be possible for a generation, but it could be resurrected.

    If they don't leave soon, are things going to become more difficult and impossible? The costs will be higher both economically and politically as the markets seem intent on their course to pick the countries off one by one. If the ECB really is firm about backing any country in difficulties, then maybe they can all stay together, but Monsieur Trichet's words sound short term and will, if that is true, only postpone the evil day.

    The question I have is - let's suppose they do leave, possibly with others named above. We will have a potential 2 speed EU, can it stay together for trade purposes? Will the disparity between Euro members and those outside it become unbearable just from an economic point of view? It may take many years, but the differences will grow and become more and more noticeable.

    The EU in all aspects is man's invention; I doubt we have the design right yet, it needs to evolve, but that takes time I doubt it has, it takes patience I doubt the politicians have, and it takes will that I doubt the people have.

  • Comment number 21.

    GB joining the Euro and Germany leaving it is not going to happen regardless of the pros and cons of economics. It's the politics stupid.

  • Comment number 22.


    Ms Flanders, firstly thanks for continuing this discussion. As a part German, but English born and bred, even talk of withdrawing from the Euro is painful and, to me and most of my relations, it has unwelcome echoes of a 'wounded and deeply disappointing' sense of German History.

    The ECB and the German Government have an difficut task. The Eurosoap has many strong and weak characters. What they say on stage may be very different to what they say in the wings. There are certain things that actors do not say to one another during the performance ('Prater Violet', I think). And as to what lays behind official script we can only guess .

    The conjunction of the Credit Crunch and the interconnected Euro Crunch is mettle testing. I find, in Germany, that much TRUST , as a human capital resource, has gone for good. Trust in the elites involved in Governance, trust in other countries, trust in hard work and fairplay...
    The will to soldier on down the Euro road is being eroded. If the Euro remains around, in its current form, to triumph in the end .... no one knows AT ALL.

    If recent opinion polls in Germany are to be relied upon, the German Electorate want out of the Euro experiment. Even at short and medium term hurt.

    Although your blog today prizes Pandora's box further, there is always proverbial Hope. Europe will continue, even though troubled times may still be ahead.

    It takes courage to keep OPEN the discussion of Germany's withdrawing from the Euro .

  • Comment number 23.

    Well if you can think the unthinkable Steph
    Perhaps you can do the undo-able

    And the undo-able on a previous blog was convincing ‘anotherengineer’ of the existence of the debt based monetary system.

  • Comment number 24.

    It appears that the ECB is now monetizing the debt of Portugal and Ireland. See:
    http://www.zerohedge.com/article/ecb-intervention-continues-trichet-accelerates-portuguese-bond-buying-forces-short-squeeze

    This just proves the point made several times in this blog today, that short term steps to get through the current day/week are always more preferable to actually sorting out the problem. I think these guys must like the adrenaline rush of playing Jenga with sovereign finance. And you can guarantee they will not be affected as it crashes down.

  • Comment number 25.

    I suggested previously that running parallel currencies might have been a safer way of starting the Euro. At this point, it might be the safe way either to keep the Euro alive or to provide a softer landing for a Euro exit.

    At present, all the Euro countries do sort of print a parallel currency in the bonds they issue and sell. However, those bonds come at the cost of spiralling debt. A fiat currency has no debt attached to it. With such a system, Ireland could pay its debts and Germany could protect its savings.

    And the dreaded market and forex traders would take care of devaluing everyone's debts.

  • Comment number 26.

    Obviously this is a crazy idea. The shocking thing is that there does not appear to even be a plan at the moment! Slow incremental change means carrying on with the crisis, which is surely bad for everyone...

  • Comment number 27.

    16. At 1:25pm on 03 Dec 2010, Oblivion wrote:
    Let's please return the topic to the fact that UK debt is at 7.5 trillion pounds and at 540% of GDP. When do we wish to join the Euro? After the UK sovereign default or before?


    As regards the UK’s AAA rating:
    I reckon you should be given:
    The first is ‘A’ because you pay back the capital.
    The second ‘A’ because you honour the interest payments
    The third ‘A’ because you don’t water down the value of the gilt by printing more money.

    Which rather suggests from a ‘true’ investor’s point of view the third ‘A’ is likely long gone but not admitted to, and the UK has already partially defaulted.

  • Comment number 28.

    19. At 1:51pm on 03 Dec 2010, Cameron wrote:
    I disagree. I'm not Euro-phobic at all but there is a fundamental flaw in the currency. You cannot have monetary union without fiscal union, Ireland is a perfect example of that where low taxes created a business boom and inflation levels the Irish couldn't control, culminating in a massive asset bubble, now burst.
    =========================================================================
    I totally agree with you and as a person who actually lives in the Emerald Isle I can tell you that they still believe that having an ultra low corporation TAX will be the saving of us. I am not convinced as we have many head quaters and not so many industry. And the head offices run with a skeleton crew who add little to the economy. The rest as they say is history as we have lived the good life, we had the highest standard of living anywhere in the western hemisphere now we have the largest personal debt per head in the world. And what is frightening is that many are just walking away from it. Emigration is a big draw if you have crippling debts and negative equity the size of a third world country. One of my neighbours bought his property in late 2006 he now has over 600,000 Euro negative equity. He is looking at emigrating and just walking away from his house and the rest of his other debts. He knows that some institutions may try but it will be almost impossible for them to track him down and even harder to get anything out of him.
    =============
    Of all the currencies left in Europe the Sterling is the most capable of staying independent and until someone decides to create a United States of Europe I can't see a compelling reason to join.
    =========================================================================
    Again I totally concur on all of these points but in particular the creation of a USoE that is the only way the Euro could survive.

  • Comment number 29.

    #18. Dillers wrote:

    "#5. John_from_Hendon wrote:
    Europe needs one currency

    Europe does not need one currency.
    "

    You work for a bank?

    I'll raise you one Farmers Bank of China Yuan (a 19C Chinese banknote I happen to have), or one Continental (see 7.1 above)

    Prosperity cones from cooperation and trade. A desperate collection of currencies ONLY benefits bankers.

    The 'when the time is right' argument - it is never right - it is an excuse to maintain the monopoly (cartel) profits of the bankers.

    When the Euro is weaker is the one opportunity we have to join at a sensible rate - we must join NOW or else forever be beholden to bankers.

  • Comment number 30.

    26. At 2:33pm on 03 Dec 2010, Fred wrote:
    Obviously this is a crazy idea. The shocking thing is that there does not appear to even be a plan at the moment!
    =========================================================================
    Germany have had their treasury model a number of scenarios with regards to their or other members states leaving the Euro so I would suggest that there are some outlines down somewhere.

    I would say that if the German press are even close to the public's mood then their days are numbered as members of the Euro. The return to the DM is all the talk.

  • Comment number 31.

    #19. Cameron wrote:

    "@5
    I disagree. I'm not Euro-phobic...I can't see a compelling reason to join.
    "

    I suggest you remove the banker supplied blinkers! Try manufacturing and trading with a highly volatile currency and you will understand why business prospers, the real economy prospers and the country prospers when the bankers are prevented from stealing the fruits of trade. That is why we need to join.

    If we do not join ASAP you are admitting that the whole Nation has been defeated by the bankers!

  • Comment number 32.

    "It may be unthinkable, but I'm not the only one thinking about it"

    I am not sure why you think that this is unthinkable Stephanie or that you were the only one. Martin Wolf at the Financial Times and Wolgang Munchau from the same place have been suggesting such things for some months now.Some time before your article.

  • Comment number 33.

    I am fascinated by this blog, but unfortunately for the wrong reasons. Seriously, one of the greatest disappointments for me as a European expat for many years in the UK about the British people is the hostility of too many Britons towards the Eurpean integration, our economy and apparently most of all our currency. Not just extremist politicians like Farage etc but also blogs like this one show it. What is this other than propaganda, hoping it will somehow be taken serious by someone and help to damage Europe by spreading nonsensic stuff like this? It is sad that I have to report back home all the time how little British approach to Europe seems to have in common with ours on the continent. My conclusion is very different from yours: It is not Germany or any other country that should leave the Euro (I have very much more faith in that currency than the pounds that I am earning). It is the UK that should leave the EU. It is too hostile towards its continental neighbours to be integrated, so no point of it being a member. Yes sometimes I have the feeling Second World War or even the Napoleonic Wars are still on. We can have some bilateral cooperation between UK and EU, but anything else seems too much too ask, even though I realise that not everyone in the UK will share the hostile views that we are bombarded with here on the daily for as long as I can think back: The Euro will collapse! Euro to collapse! No more Euro tomorrow! will the Euro collapse? can the Euro be saved? Is the Euro a doomed currency? Will Europe implode? Is Europe still there? And now? And now? For how many years has this been going on now?

  • Comment number 34.

    Hi JFH

    No I don't work for a bank and cant say that I am that thrilled with the way they have treated small business' like ours. During the last recession we were paying 18% business rates on our loans. We are not overly happy with the way large bodies manipulate the market and the way the state in all its various guises constantly looks to regulate, more often than not ineffectually.

    I believe the Euro could have worked and gradually more countries joined in. But sadly as I stated the politicians threw that opportunity away, it is not just the fault of bankers. If it is to survive it needs more than tinkering with but a complete overhaul and a managed break up if it is to be saved long term. Kicking the can down the road is no solution.

  • Comment number 35.

    I feel that Germany will not leave the EMU even if there may be a few billion Euros involved. That is only economics. Germany spent millions of lives and billions of DM in an attempt to control Europe. With the Euro it has most of Europe, indeed all of Europe, tucked under its belt. Why on earth would it retreat now?
    All effective currencies have to be controlled from one site: the USD from Washington, sterling from London, and the Euro eventually from Frankfurt. I think the trouble with the Euro is that everybody is pretending that it is a jolly nice little agreement and nobody is any more powerful than the agreements. All that may change in the near future. I feel I can hear a collective sigh of relief in the investing/business world when a German hand controls the ECB.

  • Comment number 36.

    #33. markus_uk wrote:

    "It is the UK that should leave the EU. It is too hostile towards its continental neighbours to be integrated, so no point of it being a member."

    Don't believe all that every banker tells you about the UK attitude to Europe. True, we have a war warmongering xenophobic tabloid press run by and for an aged disgruntled republican, but don't believe the Sun. The Sun is about selling papers it is not a voice of the Nation. Do you believe everything in Bild reflects German National sensibilities? The best use for both is to be torn into neat squares affixed to a piece of string and installed in the outdoor WC.

    The UK people voted twice to join and stay in Europe - We are as much European as any European. We have suffered egregiously in two world wars to protect Europe from itself - what makes you believe that the UK is not European enough?

    All this negative nonsense about the Euro is the direct result of our obsession with banking and bankers. They are not the spirit of GB. They fulminate violently when it looks like one of their great money spinners will be taken away from them. But Europe must help the UK to vanquish its bankers. We(the UK) are is a desperate life and death economic struggle to seize back the country from its bankers. Argue for the UK joining the Euro and silence these idiot apologists for the bankers.

  • Comment number 37.

    #34. Dillers wrote:

    "I believe the Euro could have worked and gradually more countries joined in. But sadly as I stated the politicians threw that opportunity away"

    The blame Gordon Brown arguement!

    I still have all of the publications of the Bank of England preparing the country to join the Euro. They still apply today. Much of the work and preparation has been done. All we need to do is to declare that the city of london is a foreign country responsible for itself and unable to call upon the people of the UK for support and bail-outs and we would be back in with a real chance of reestablishing the Greatness of British business and manufacturing. I say kick out the bankers.

    Gordon Brown is ancient history and his legacy of total bank orientation of the economiy destroyed the country all we must do now is to expunge the evil banking powers. We are unforthuinately blessed with intellectual whimps in our regulators. These gutless dolts can't even own up properly for the collapse they caused. The UK must never again rely on banking and its fellow traveller 'fiancial services' to profitably employ its people. We must make things again - this is what re-orientation the economy is about. We unfortunately have a pair an complete amateurs running the important officies of stste (DC and GO) so we must re-educate these men. If we want to see a properpous trading Nation again - we must get rid of the bankers! No backsliding!

  • Comment number 38.

    The incremental approach is the hallmark of the European way, predicated as it is on the need to compromise at every turn, especially given the way that politics and politicking operate there. It is this much vaunted methodology that is held up as so superior to the UK's anglo-saxon system, and the reason why Europe, in the guise of the EU and its myriad of smoked suffused backroom johnny's and their decision making protocols, is ultimately promoted as the only game in town.

    Well hello, it's not. No system is perfect, and no approach works in all situations. But in this case, somebody needs to grow some stones, make a decision, and promote it loudly and clearly from the mountain tops - otherwise all is fear, uncertainty and doubt and speculators will have a field day as they grow fat on the back of these mossy backed three toed sloths that pass for politicians sur le continent (perhaps thay should adopt one as their mascot).

    Frankly, and as apocryphal as it might be, my approach would be along the lines of "Economic malaise across The Channel, Continent cut off". They created the fantasy that is the Euro, let them magic themselves out of the mess that resulted from their imaginings.

  • Comment number 39.

    When Germany leaves the Euro (EMU) then the EMU and the Euro and possibly the EU fall part anyway as there is no other country willing to fund the bail outs needed ... and if they do ... these are not laons as some countries willhave no intention of every paying anything back.

    A structured an orderly withdrawal by all EU countries from the EU, possibly keeping the Euro as a reserve currency while negotiations over the future role of the EU/ECB/EMU etc can take place would now be eminently sensible.

    The difficulty is in the implementation not the policy ... most now realise that the EU/Euro/EMU is a dead duck in practical terms.

    I see some parralles with some countries and Latin American countries in the 1970's/80's and 90's ... but many have now recovered on their own and
    without monetary union ... whatever a country has or does not have ... a country, any country as a sovereign cost centre ... has to manage 'it' properly.

    Crash Euro - Crash!

  • Comment number 40.

    Germany competes on quality not price, Chinese compete on price, not quality.
    This is still about the banks extorting from the governments creating higher debts than are necessary. One would think that since governments are heavily invested in the banks that they could negotiate a better rate. Until some control is exercised over the banks nothing positive can happen. Although some segments of the German economy are doing well other sectors will face the same fate as everyone else. The bankers have all the countries in a corner again and there is no leadership to take control of those who caused it all.Demand creates jobs...very basic concept...loaning money to businesses that have no demand is a waste of time...only politicians can talk about loans as creating growth when there is no demand, but of course one shouldn't expect honesty from the political. Bailing out banks was a major mistake as no provisions were made for their participation in the recovery. If the citizens purchase products produced within the national economy and not from overseas, things will get better. The problem is that primary investors have their money in Asia and would not favor a national recovery based on people looking out for their own national interests. Politicians do what the primary investors want, not what is good for the nation. Maybe it will all have to fall apart before things get better as no one gives up power willingly.

  • Comment number 41.

    If Germany and Ireland to too far apart economically to use the same currency, then shouldn't London and the North East also have separate currencies. London is much more productive than the North East. The North east will never recover unless it has its own currency, which it can then devalue against the GBP. If a country as small as Ireland needs its own currency, so so do all the regions of the UK and of other large countries.

  • Comment number 42.

    Hi JFH

    Not sure about the "blame Gordon Brown argument" as I did not think he was in charge of allowing the first tranche of countries to join the Euro. I also thought he was not for joining the Euro when he was in office.

    My point was the Maastricht treaty of 1992 obliged EU States joining the Euro to meet money and budgetary requirements. Why were those States that did not meet these requirements allowed to join?

    I do not see that has anything to do with Gordon Brown or the Bankers.
    Surely it is EU officials and the heads of States at that time who should be held to account for allowing countries in that had not met the convergence criteria.

  • Comment number 43.

    There is considerable angst over even discussions of German departure from the Euro. So long as the European Union was revelling in its bravado in challenging USA, this German departure was not on the cards. It is only when there is growing realisation that the rest of the world is not waiting for the re-emergence of Charlemagne's Empire, that the rest of the world prefers the english speaking world, that the EU will never be able to challenge the super-powerdom of the USA, that there is wilingness to consider options - especially as economically the EU mountain of debt is untenable with economic realities.
    Particularly galling is the virtual single handed responsibility that Germany seems to be shouldering in bolstering the Euro and the PIIGS. Clubs function meaningfully when the responsibilities are shared.
    The British Empire collapsed when Britain was left alone unable to shoulder.
    The USSR collapsed when Russia was left alone unable to shoulder.
    The EU is no different with Germany left alone unwilling to shoulder.
    France should have thought it through when DeGaulle confronted the USA over gold convertibility in 1971 and forced Nixon & Kissinger to seek Pacific partnerships with China uber alles.
    Britain similarly was unable to think it through when USA was jettisoned or even when India was jettisoned - withou the two, it had no chance of retaining its numero uno position.
    But history is history - for exactly that.
    Once the Rubicon is crossed, you can only learn from history, cant change it.
    If Germans leave now, it is perfectly understandable.
    PIIGS will need to reinvent the Holy Roman Empire once again, as they have so many times in history.

  • Comment number 44.

    17. At 1:37pm on 03 Dec 2010, fourbetwo wrote:

    Foolish fellows, we are witnessing the death throes of a mis-conceived, egotistical, politically-engendered abomination.


    At least you concede it is political. Though the invective was unnecessary and alludes to your Little Englander mentality.

    From an economic perspective their is little advantage in leaving for any member. It will be very painful for any of the PIIGS to leave and little advantage for Germany. This is despite the very obvious economic flaws in the Euro.

    So, full steam ahead to fiscal union is becoming more likely.

    Given the more than slight economic resemblance of the UK to the PIIGS I would be surprised if any request by the UK to join would be entertained without laughter.

    As for Sterling, all alone and sinking.

    Finally, my free service to 'phobes and 'philes alike, todays closing rate:

    £1 buys 1.17720 Euros (not a lot).

  • Comment number 45.

    #42 Dillers,

    "My point was the Maastricht treaty of 1992 obliged EU States joining the Euro to meet money and budgetary requirements."

    Why were both Gertmany and France allowed to break those very rules?

  • Comment number 46.

    45. At 7:25pm on 03 Dec 2010, foredeckdave wrote:
    Why were both Gertmany and France allowed to break those very rules?

    Exactly .. What hope.. But perhaps Germany sneaked in on a typo?

  • Comment number 47.

    45. At 7:25pm on 03 Dec 2010, foredeckdave wrote:
    #42 Dillers,

    "My point was the Maastricht treaty of 1992 obliged EU States joining the Euro to meet money and budgetary requirements."

    Why were both Gertmany and France allowed to break those very rules?


    ======================================================================

    I doubt the Maastricht 'rules' anticipated the worst recession (depression ?) since the 1930s.

  • Comment number 48.

    #44 Richard Dingle,

    Richard,

    I have to agree with you that 'heat'from the 'phile' and 'phobe' crews add little to the quality of debate - that's what it is a debate!

    As for, "So, full steam ahead to fiscal union is becoming more likely." I think that you will find that there is more than a little resistance to that. Just look at the the feelings reagrding sovereignty that are being voiced in Ireland.

    BTW, given that very little has actually been done to address the UK's economic problems then I would remind you that £1 buys 1.17720 Euros today whereas not so long ago it bought 1.09 Euros. Like it or not, in the present circumstances the UK is far better off (at least in the short/medium term) staying well clear of the Euro.

  • Comment number 49.

    I am English, then British (where UK comes i've no idea) and then European, oh and a royalist, so I am and have always been a subject of this realm. BUT! He who stands alone, dies alone.

    I was always taught to never poop on your own door step (for one thing it makes the whole house smell). We need the protection of another currency i.e. the euro, it may in some eyes be weak but there is a lot of it (as per the Russians in WWII). The euro also needs sterling and so the two should be pegged. I do not believe that we could stand a 17% devaluation and the likes of Spain would suffer because of this devaluation. So like it or not we are already dependant upon each other. Being joined at the hip means; that if we are financially targeted, it effects the euro and visa-versa, this I believe will stop some of the unscrupulous speculators dead in their tracks and make them seek self gratification further a field i.e. they cannot poop on their own anymore!

    As for Germany leaving – find a life without blinkers. Who says we need education – Educators, who says we need coal – minors, who says we need mobile phones – etc, etc, etc and who says we need the city – THE CITY! ‘and economists’.

    For those of you who believe that we should not be joined in some way to the euro, then you must accept by default that you are for joining the $ and therefore want to be the XX or XXX state of America, after all they have been looking for a new Cuba, Korea (Soul) threw them out. We cannot be an integral part of the commonwealth any more and we are too small to act independently. If there is another option please do tell.

  • Comment number 50.

    #41 bankok swan

    From an economic perspective spot on, but politically not possible. As I see it, either you are a country, a member, or a federation - what ever you chose to be, there will be good bits (economically speaking) and bad bits to your territory and the good bits will have to support the bad bits (eg the USA) - Germany has the choice - pull out or support the less viable parts of the Euro-zone

  • Comment number 51.

    Yeah yeah, Germany really wants a 20 percent rise in its currency. Why didnt I think of that. Yeah the German workers dont like the PIGS. Fine the German workers can put themselves out of work. Oh maybe not, not when they think about it. This is just Merkel playing to the gallery. The lady protesteth too much I methinks. Just like Nancy nearly scuppered the american rescue 08 then spun on the spot. Just take a look at the monologues from the time - We will not have taxpayer money bailing out blah blah blah. We will listen to the voice of the hard working american citizen. We will not bail out.. We... We will save the american citizen in their hour of need. We will take the necessary steps to secure the future blah blah blah. We are the saviour of the people. Give it a break. Why does anybody listen to a politican under stress, they are bad enough when they are not under stress.

    As for all the xenophobia on this board, extraordinary. Lets put the world back into the middle ages. Some of these people would be scared of somebody from the next town let alone another country.

    The EU has to become stronger and move to fiscal union. However the UK refused recent requests that all member budgets were presented to the EU in the first instance for vetting for compliance with the EU criteria. Seems reasonable to me, you join a club, the club rules say you have to do this and that and they ask if you are actually doing it. Obviously it is much easier to allow a minority of countries to cook their books and cause a crisis. I must have it wrong.

  • Comment number 52.

    If I were Germany I would make sure that I got my gold, that is currently stored in the US, back on home turf sharpish.

    The Euro is run by the bankers as is every fiat currency. I have no idea where this fallacy that we can run to the Euro to escape the bankers comes from?

    If the arguments in favour of going into the Euro are so compelling then the government will have no qualms in asking the people of Britain in a vote.

  • Comment number 53.

    47 RD

    Maastricht 'rules' were written in a period where the problem was seen as inflation.

  • Comment number 54.

    Too often these blogs turn into slanging matches between pro and con Europeans or nationalists of various varieties. However, I am rather surprised by the comments of Markus_UK @ 33 concerning the hostility of the British towards Europe and the EU.

    Markus

    I wonder if you’ve spent too many years in Britain and started to believe the claims of the British and their press. The fact that you refer to the rest of Europe as the continent sounds too British.

    I am British and have spent most of my working life outside of the UK, mainly in other parts of Europe. I can assure you that hostility to the EU is far from the UK monopoly some of the British press would have you believe. In the popular European culture, the sources of problems in life are: immigrants, the rules from the EU, the Euro, the government of whatever country you are in and, possibly, the bankers. I do agree that the opposition to the EU has a wider political voice in the UK, but that is probably because (and I realise no one in the UK will believe this) the popular voice reaches more in to the political world there.

    I’d suggest that the British are more open to constructive European partnership and integration than you suggest. However, in many ways, they have more to lose than citizens of other countries. It may look archaic, but the British democracy and the systems of the British state have evolved over 1,000 years. There are a lot of faults, but I can say that, overall, most of the other systems in Europe are worse, even far worse; so much that the idea of political, fiscal or many other types of union should be frightening for a lot of countries. I’m not making a Britain is best claim. All the European countries could learn a lot from each other. One of the themes in Germany, especially in industry, is an emphasis on quality (and perceived quality). If manufacturing in the rest of Europe is to survive, we must all follow that example. The efforts the French government and society has put into defending and strengthening its industries put the UK to shame. I can make a list that goes on forever. Sadly, the EU has not succeeded as an organisation for sharing strengths and learning from others. Beyond that, having done work for the EU in Brussels, my impression is that the organisation is a terrible mess that could not make a success of anything.

    You feel the British are still fighting WWII, well I’m afraid you’ll find that everywhere. I well recall a meeting with a couple of German engineers, extremely able and intelligent men. However, once work was finished and we’d moved on to social stuff, I had the very uncomfortable feeling that I’d slipped into one of Leslie Howard’s propaganda films set in the 1930s. However, I don’t regard that as typical of modern German society. I can assure you that there are people with all sorts of ideas in all countries. On average, all people are all the same. It is a great injustice to regard any group, national or other, as better or worse.

    Anyone in Britain who wants the Euro to suffer a catastrophic failure is a fool. The damage would run far and wide and way beyond this continent. In fact, though a lot of contributions to this blog are rightly critical of the Euro, most are suggesting or asking how things can be put right. Some, even now, see currency union as a missed opportunity for the UK.

    In summary, by all means criticise the UK. On almost any topic you’ll be right and we deserve it. But, to say that we are excessively hostile to the EU and our neighbours is totally untrue.

  • Comment number 55.

    #47 Richard Dingle,

    Richard,

    As you know I am ver loathe to have to point out some flaws in your argument :)

    The breaking of the Masstricht rules by France and Germany (got it right this time!) was before 2007

  • Comment number 56.

    @40, ghostofsichuan wrote:

    "Germany competes on quality not price, Chinese compete on price, not quality."

    I'm old enough to remember several decades ago someone using almost the same words except it was Britain instead of Germany and Japan instead of China.

    I wonder where things will be in a few decades time?

  • Comment number 57.

    52 You sure love your gold. BTW The british public have had decades of tagrag fleet street journos telling them about continentals in strange clothes wanting to take their chocs and bangers and pint away.

  • Comment number 58.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 59.

    55. At 8:25pm on 03 Dec 2010, foredeckdave wrote:
    #47 Richard Dingle,

    Richard,

    As you know I am ver loathe to have to point out some flaws in your argument :)

    The breaking of the Masstricht rules by France and Germany (got it right this time!) was before 2007



    Before 2007, but not before 1990 and the unification and associated costs (avg 80 BN Euros pa).

    I can't speak for France.

  • Comment number 60.

    #59 Richard Dingle,

    You are now trying to mix 2 very different things and I'm not quite sure why.

    Masstricht Rules have nothing to do with re-unification.

  • Comment number 61.

    52. At 8:15pm on 03 Dec 2010, truths33k3r wrote:

    The Euro is run by the bankers as is every fiat currency. I have no idea where this fallacy that we can run to the Euro to escape the bankers comes from?
    ----------

    From this I deduce that you accept that the ‘banker’ are controlling every turn of this crisis, and that given the present set of parameters, there is no escape.

    And from that I take it that you feel that the British government is either too weak or that their hands are bound.

    Would it be fare to say this: there is more strength in number then in the individual i.e. the sum of it’s total parts is greater than the sum of the individual parts (well I know what I mean). I am putting it forward as if it is a war, not a physical war but a war of attrition. A game of power and control if you will and I for one am not comfortable with who is winning.

    That is my basic reasoning – increase the odds and you’re more likely to win.

    So over to you – why wont it work?

  • Comment number 62.

    The major economic cost would be the hit to competitiveness, because the new German currency would surely go up. It's up for debate how much this would force the much talked about rebalancing of the German economy. Listening to Germany's politicians and industrialists, you would expect it to have very little impact: in the world market, they tend to argue, German companies compete on quality, not price.
    -----------------------------------------------------------------------
    Interesting statement, Stephanie, but would it? The markets might decide that Germany outside the Euro (and possibly the EU?) might become the weak linkless piece of chain rather than the strongest link in an increasing chain made up of a mix of weaker and the weakest links? After all, the argument many put forward pro EU/Euro is that western and central European countries cannot survive alone in the post post-modern world.

    Secondly, there might be a loss of market - not with the old EU club, but because Germany might be seen by the New Economic Powers as slightly suspect, seeking a new personal hegemony without the 'brake' of the rest of the EU, especially Britain.

    Thirdly, Britain might benefit from Germany leaving the Euro, finding new partnerships between them and the existing position of a semi-independent UK essential in routing trade from north-west, east, west, south-east and south-west. If the pound were to be perceived as such by the markets, it might take some or all of the growth you appear to suscribe to a New Dm.

    Finally, in the price quality matrix, the levels of production relating to high quality are smaller than low quality. Looking at our world, by and large, it is harder to make lots of money producing low volume, high quality products. It can be done, but it is not easy and maintaining the position - in a rapidly changing economic world - may be rather fraught.

  • Comment number 63.

    re #54
    Well put, thoughtful obsevation and analysis. Thank you.

  • Comment number 64.

    60. At 8:56pm on 03 Dec 2010, foredeckdave wrote:
    #59 Richard Dingle,

    You are now trying to mix 2 very different things and I'm not quite sure why.

    Masstricht Rules have nothing to do with re-unification.


    Maastricht Rules concern deficits.

    Germany borrowed on the bond markets.


  • Comment number 65.

    36. At 5:15pm on 03 Dec 2010, John_from_Hendon wrote:

    All this negative nonsense about the Euro is the direct result of our obsession with banking and bankers. They are not the spirit of GB. They fulminate violently when it looks like one of their great money spinners will be taken away from them. But Europe must help the UK to vanquish its bankers. We(the UK) are is a desperate life and death economic struggle to seize back the country from its bankers. Argue for the UK joining the Euro and silence these idiot apologists for the bankers.

    37. At 5:25pm on 03 Dec 2010, John_from_Hendon wrote:


    I still have all of the publications of the Bank of England preparing the country to join the Euro. They still apply today. Much of the work and preparation has been done. All we need to do is to declare that the city of london is a foreign country responsible for itself and unable to call upon the people of the UK for support and bail-outs and we would be back in with a real chance of reestablishing the Greatness of British business and manufacturing. I say kick out the bankers.

    If we want to see a properpous trading Nation again - we must get rid of the bankers! No backsliding!

    ------------------------------------------------------------------------
    John, Are you really willing to take on tax rates that high? We learnt many lessons in the last thirty years. One is that it is foolish to tax too much at the bottom of the heap and not enough at the top. The other is that people at the top of the heap are a lot greedier and hate tax much more than those at the bottom.

    What do you think would happen to the work of creating a prosperous trading Nation if London's banks were ringfenced off from the rest of the country?

  • Comment number 66.

    61. At 9:35pm on 03 Dec 2010, common_man_123 wrote:
    "That is my basic reasoning – increase the odds and you’re more likely to win."

    I do not see it as a war between the bankers and the government. The bankers are the government. The revolving door between banking and politics is much more obvious in America with Hank P being ex Goldman Sachs etc, but it is a well known fact that Tony Bliar receives huge sums each year from the banking community.

    The power lies in the monopoly power of issuing fiat money. Print your own money and you go to jail, Mervyn King prints billions and he is a hero that has saved the world. My argument is that the globalist elites want as few currencies as possible. The Euro provides a useful stepping stone but ultimately a global currency has to be the ultimate aim.

    The government will not solve our issues, they are the issue. It is the individual against tyranny and this is why they hate gold as they cannot print it.

  • Comment number 67.

    66. At 10:10pm on 03 Dec 2010, truths33k3r wrote:

    My argument is that the globalist elites want as few currencies as possible. The Euro provides a useful stepping stone but ultimately a global currency has to be the ultimate aim.
    -------

    I hear what you are saying but I cannot agree with the above statement, I would suggest that the opposite is true. I love playing strategy games, I was bought up playing them, from cards to most of the ‘*opolies’ and beyond. The more players you have the greater the opportunity to manipulate and win by a greater margin. You have to know what game you are playing: scrabble is a game of spelling words, NO! it is a game of using words to your best advantage. There may well be the James Bond villain out there that wants to rule the world but bankers need competition in order to manipulate.

  • Comment number 68.

    67. At 10:37pm on 03 Dec 2010, common_man_123 wrote:
    "There may well be the James Bond villain out there that wants to rule the world but bankers need competition in order to manipulate."

    We will have to disagree. What singles out banking is the lack of competition. In order to manipulate all you need to do is to control the rules of the game, and ensure that the vast majority of players do not.


    "Competition is a sin."
    John D. Rockefeller

  • Comment number 69.

    68 truths33k3r

    The objective of business is to gain monopoly. The objective if government is to break monopoly, ie increase competition. The conflict is in debt fed consumer based economy a politican is in the situation of governing the device which gives short term economic growth, ie debt growth.

    The only way forward is to move to more direct linkage between the electorate and the politican ie digital democracy, and conccurently take steps to de-emphasis consumerism. The problem is cultural not financial and to do with individuals.


  • Comment number 70.

    68. At 10:59pm on 03 Dec 2010, truths33k3r

    Sorry I realised after I had writen '.....but bankers need competition in order to manipulate.' that it could be read two ways and unfortunately you have taken it opposite to what I was trying to say.

    I was not saying competition between bankers but competition between individuals allows bankers to manipulate, therefore by reducing the number of individuals you reduce the opportunity.

    The problem with quotes is that they are selective to prove a point. Winnie said ....yes I am drunk.... So we had a alcaholic running the country. I don't know this buts lets put 'Competition is a sin' into a context

    A bankers convension and J D R is the key speaker and the main topic is interbank competition and how by undercutting each other many smaller banks are finding it difficult to servive. Now it's meaning is different!

  • Comment number 71.

    NBW - what is a digital democracy - facebook? how would it work?

    Is the de-emphasis of consumerism to be done by force? Do you support the Cancun proposal that everyone in the west should be rationed (except for the rich, powerful and connected of course)? Is the climate change debate a great way of enforcing rationing? Is an elite group of technocrats a better way of distributing wealth that open and free trade?

  • Comment number 72.

    70. At 11:27pm on 03 Dec 2010, common_man_123 wrote:

    "I was not saying competition between bankers but competition between individuals allows bankers to manipulate, therefore by reducing the number of individuals you reduce the opportunity."

    I don't understand what you mean by this.

  • Comment number 73.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 74.

    Truths33k3r

    Were the British Government manipulated into guaranteeing 7bln to Ireland? We already give money to the IMF and Europe and by definition therefore were already contributing? If we bought for 5% and sold on for 7% then on the face of it a good deal, but who’s making the 5%? But on the books we are in hock for another 7bln.

    The question therefore is: could we have been put in this position if we were inside the euro?

    And what about Spain and Santander?

    Individual = Metaphor (schooling was long ago so I hope I’ve got this correct)

  • Comment number 75.

    ********************************
    5. At 12:07pm on 03 Dec 2010, John_from_Hendon wrote:
    Stephanie,

    Why do you give credence to the nuke-self option? They will only benefit bankers.

    Europe needs one currency. It has one. Why do you think that the bankers want to destroy it? Can this be for anything except their naked self interest? Have we forgotten the economic destruction that the very same bankers unleashed upon us a couple of years ago?

    We should join the Euro. We need to be inside the single currency. The only part of the economy to benefit by either destroying the Euro, or keeping the UK out, is the bankers. The jingoistic Little Englander xenophobes MUST be stopped, and we must remind that that the bankers destroyed the country. Bankers (and their economists) are not just part of the problem - they are the problem!

    And don't say that economists think that destroying Europe is a good idea for it is these very same economists that justified the bankers and took an active role in destroying the Nation in the last decade. Why do you and we still listen to these proven and self confessed idiots? We must expunge their insane self-serving ideas!

    ***************************************************

    Opinions are like rear ends everyone has got one.
    It was low interest rates, too low for too long, that was the "root" cause of the financial crisis causing the boom & bust with cheap money.
    Low interest rates welcomed by the last Govt who were skimming all the tax receipts from the vast amount of transactions that were taking place, without a thought of where it was leading to as long as they got their bit to finance all the daft social schemes.
    As far as the EU goes, no one in this country has voted for what we have now.
    It has been IMPOSED upon us.
    These pro european types MUST BE STOPPED before it is too late.

  • Comment number 76.

    Stephanie apparently wrote: It may be unthinkable, but I'm not the only one thinking about it.
    +++++++++++++++++++++++++++++++++++++++++++++++++++++++++
    Then you're probably wrong about the first bit.




  • Comment number 77.

    You get paid for these daydreams then, Stephanie?

    Hey, that's some living.

    Here's mine: 100% of divorce is caused by marriage. The sum total of misery caused by the former outweighs the happiness stemming from the latter. It therefore makes sense legally to derecognise the said arrangement.

    Where's my wodge?

    Aah. I'm not employed by the BBC...

  • Comment number 78.

    Morning Stephanie,
    Germany, Netherlands, France will leave the Eurozone if and when it suits them. At the moment, it is in no countrys interest to do so, therefore it will not happen.
    I see you published your theorem on Friday 3/12/10. I think that this day will go down in history as being the turning point in the financial crisis of 2007.
    My reasons are,
    1) I am completely fed up with the pronouncements of Jean-Claude Trichet who as a former French Central Bank head is making the European crisis worse by the day. He says one thing, hints at another, and the ECB act on a third. It's time for him to retire.
    2) Weaker European countries have debts that they can NEVER pay off so defaults are both required and desireable. Only by this mechanism can some order be brought back into European affairs because then at least, bonds could be CORRECTLY priced (knowing the discount rate).
    We are struggling along from country to country and what the market needs is certainty and they are getting none but fearing the worst.
    3) Mr Bernanke is taking yesterdays unemployment figures as justification for his QE and further has hinted that he will not stop at $600 billion (my guess is about $3 trillion is required).
    The consequence is that both the Euro and the Dollar are in a race to the bottom to make their exports competitive. This will all end in tears.
    4) As UK shivers during this global warming, nobody appears to be taking any interest in what the EU, and by definition the UK, are doing with their energy policies. This is fraud on a grand scale but nobody cares because it hasn't hit them yet. Time to WAKE UP people, this concerns you and your children/grand-children.
    5) As I stated in a previous blog, Oil is going up in price rapidly, not because of fundamentals of supply and demand, but because of speculation on the price by your State-Owned banks. Does no one remember what happened when it reached $150/ barrel(US)? This time it will probably peak at $200-$250/ barrel(US). What are you going to do then?
    Other energy costs for electricity in particular are going through the roof.
    All commodities especially foodstuffs and metals like copper are under the same inflationary pressures as traders try to make more and more money for nothing!
    Please mark this day in your diary, Stephanie, the day the Western world finally went unstable.
    Doesn't bode well for 2011, does it?

  • Comment number 79.

    This is a wee bit like the American Civil war. Then too the British government were on the side of Confederacy, trying to engineer a break up of the US. It didn't work then and it wont work now. To be fair I don't think the Brits want to break up the European union, but just to make sure a confederacy reigns supreme. And again I say: it wont work. A federation or chaos is on the cards. My advice to the Brits is start playing ball while you've got options don't repeat the past and leave it too late, so that you have to beg to join the Euro.

  • Comment number 80.

    #75. BLACK_PEARL wrote:

    "It was low interest rates, too low for too long, that was the "root" cause of the financial crisis causing the boom & bust with cheap money."

    Totally agree.

    BUT

    I totally disagree with your anti-foreigner/anti-Europe position. It is illogical, not based on an understanding of what makes the country tick and is likely to lead to conflict.

  • Comment number 81.

    #65. Up2snuff wrote:

    "What do you think would happen to the work of creating a prosperous trading Nation if London's banks were ringfenced off from the rest of the country?"

    The banks would collapse - BUT not be able to take the country with them again as they have just done. The banks need the riot act read to them and be absolutely assured of the very harsh consequences to the institutions and their staff at all levels if they create any more bubbles/crashes. Why not - expulsion from the country, confiscation of all property, withdrawal of citizenship and passport (If it is OK for us to deal with countries around the globe that do this and more - how can we not have a level playing field in consequences?) We must make these stupid banking idiots understand their wider responsibility and to that end I have been arguing for a tax system enforced National Maximum Income set at 20 times the National Minimum Wage.

  • Comment number 82.

    71 truths33k3r:

    'what is a digital democracy'

    It is where more active note is taken of the population via the internet and structured polls taken on a regular basis (on proposed policy). The Scots are looking at it. There were also suggestions and some experiments put in place by Jack Straw, mainly on side issues. It potentially erodes the domination of the electoral cycle on economics. It is resisted it would seem in some areas of government because it will remove power.

    It does however fit with repeated aside comments from both the previous Lab admin and the Coalition. Both apparently thinking that the only way to defuse the pressure lobby groups and get some reality back into the budgets is to involve more of the population in decision making. Ie shared responsibility for outcomes.

    'Is the de-emphasis of consumerism to be done by force?'

    The de-emphasis of consumerism will be forced sooner or later by resource problems. The consumer problem is also an educational one. There is an imbalance between propaganda from commercial bodies and independent sources.

    'Do you support the Cancun proposal that everyone in the west should be rationed.'

    Not as such. Natural progression in the right direction is better than forced movement. It is progression which is important.

    'Is the climate change debate a great way of enforcing rationing?'

    A whole cost accounting including the use of transportation and resource impact is a better way. There is little point in doing something like charging for plastic bags if the bulk of packaging going in the bag is plastic and exceeds the bag. Flying fruit and fish around the world with tax free fossil fuels is an odd use of resource.

    'Is an elite group of technocrats a better way of distributing wealth that open and free trade?'

    There is no such animal as free trade, all markets are regulated. I dont have a problem with anybody providing a service. The issue is regulation of the market and consumers not buying damaging goods and services.

    The principle problem is the detatchement of the modern consumer as an individual from the supplier as an individual. Since the 60s the emphasis has been to dehumanise or de-person the product by producers and retailers. The internet provides the opportunity to deal direct with a human. The de-humanised interface aids the abuse of workers and the environment. Few consumers want to abuse. In order to reinstate the human you need to work and interface in a differnt way. (That is what we do as an activity). There are implications - there is a higher cost on the interface, communication costs. It therefore suits some products and services more than others and in order to balance the cost the distribution system / supply chain has to be more efficient.

    Somebody got upset becasue I commented that the credit crunch is small beer. As far as I am concerned it is if the environment continues to degrade. A recent report on this site advised that wetland birds were becoming homosexual due to routine mercury contamination of wetlands, one source of mercury being bruning fossil fuels. We are all part of this biosphere.

    The political system has failed in part. Central to that is the fact that government(s) has become involved in debt growth in order to gain short term economic benefit which favours it as incumbent administration. Oppositions do not win elections, incumbents lose. The conflict is between government regulation of commerce to ensure sound sustainable process and government revenue gained from commerce. It has little to do with bankers at the heart of the matter. Not that I am greatly enthused about bankers, but at least you know what you are dealing with.

    The media remain depressingly unobjective and playing to the emotional. Consider the football bid. The only report I have seen stating the obvious - the bid was lost because Russia gives better market growth potential than the UK was an aside in an interview with J O'Neil ex GS on an american channel. Instead the focus is on the fob-off of media reporting souring the plot. I doubt this reporting helped but it is also unlikely to be the reason for the outcome.

  • Comment number 83.

    81 jfh

    The financial sector and business services will very soon comprise 30 percent of GDP. Why not get rid government and consumers also because they are part of the game also.

  • Comment number 84.

    #42. Dillers wrote:

    "Hi JFH

    Not sure about the "blame Gordon Brown argument" ... Surely it is EU officials and the heads of States at that time who should be held to account for allowing countries in that had not met the convergence criteria.
    "

    Politicians are liars - they have always been liars - they are constitutionally unable to tell the truth even if they knew for sure what the truth was. The same is true for officials and indeed all of us. Which of us has never said an untruth when we believe the truth would be hurtful?

    The British lie to the Americans and we are good at it for the simple souls believe us. (see Wikileaks) We say to the Americans that which we think they want to hear - even when it is totally untrue! The same is true fro every Government, every country, local or parish council.

    The last govenrment found that reality was so far from the reported truth that they introduced an enormously invaluable system of benchmarks and reporting systems to try to overcome this ubiquitous feature of real life. In part this did drive up standards, but it also encourage scheming individuals and organisations to develop even more resourceful schemes to appear to meet the required standards without doing so at all.
    The entirely synthetic 'rage' over being misled by world football is another example.

    A single currency is about economic efficiency, of course there will be issues of running they system when the parish councils, in Dublin, Madrid, Berlin, Athens get a bit stroppy, but that is how things are and we need to work together to solve the issues, but that is the key we need to work together to solve things as the greater good is the economic efficiency for all of Europe and all of its countries in having a single currency.

  • Comment number 85.

    #83. At 09:18am on 04 Dec 2010, Not Buzz Windrip wrote:

    "81 jfh

    The financial sector and business services will very soon comprise 30 percent of GDP.
    "

    The 30% shows us several things:

    - How disastrous the economic policy of all governments has been in the last forty years.

    - How much we desperately need to rebalance the economy and how urgent it is to get this process started.

    - How much we need a National Maximum Income enforced via the tax system to make sure that the gross theft of the legitimate profits of trade and manufacture are no longer stolen by bankers (and footballers!).

  • Comment number 86.

    85 jfh

    The Isle of Wight is about th size of Hong Kong. Why not lease it to the Chinese for 99 years and get it back when they have built it up.

    Then all these issues you wish to impose unilaterally on people will not be an issue to you. PS I see your hit list now includes footballers paid by private companies. No limits then.

  • Comment number 87.

    #86. Not Buzz Windrip wrote:

    "85 jfh"

    The difference between us is that I want to see the greatest good to the greatest number of people - and you want unbridled greed (i.e the failed trickle down system) Please wake up and smell the cordite! You are the discredited and failed past!

  • Comment number 88.

    One of the fundamental flaws of this argument is the premise that the populations of Europe trust bankers, and markets, more than politicians. Whilst politicians have a pretty deplorable image across the continent, few people really believe that they are the cause of this present crisis. So looking to 'the market' to solve a problem that it was instrumental in creating sounds like madness, whatever way one views it. Like appointing a hedge-fund manager to run a country...

  • Comment number 89.

    82. At 09:10am on 04 Dec 2010, Not Buzz Windrip wrote:

    "The political system has failed in part"
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    Is there even a single example of the political system in the UK delivering anything substantial and of lasting value to the people of this country in say the last 20 years?


    82. At 09:10am on 04 Dec 2010, Not Buzz Windrip wrote:

    "It has little to do with bankers at the heart of the matter"
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

    Utterly preposterous.

  • Comment number 90.

    89. At 12:10pm on 04 Dec 2010, stopsupportingcriminals wrote:
    82. At 09:10am on 04 Dec 2010, Not Buzz Windrip wrote:

    "The political system has failed in part"
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    Is there even a single example of the political system in the UK delivering anything substantial and of lasting value to the people of this country in say the last 20 years?


    No, not even the last 50 years.

    It has been all about maintaining the status quo, all about running the country for the benefit of a clique.


  • Comment number 91.

    #82 NBW,

    Digital Democracy,

    From your explanation it appears as flawed as the present system. The problems of questionnaires are manifold and easily lead to manipulation and bias. You then have to consider the communication process itself. The one thing that it does not do is include the the populace in the decision making. The thought that it evokes responsibility for outcomes is as much a fraud as the Tory mantra of choice. It is more likely to lead to an abrigation of responsibility - "don't blame me you voted for it".


    Consumerism,

    History does not appear to support your contention. The resources demand today will not necessarilly be the ones in demand tomorrow. Consumers, in one form or another, have existed since the begining of time and they will continue to do so. You really should refine your definition.

    Perhaps you should also consider that armies are consumers too. It could well be that they are employed to 'secure' resources in the near future.

    Rationing

    Will never be totaly effective and can only be used as an a short term measure. You only have to look at the UK WW2 experience to see that - even at the lowest level of rationing you could always get a 4 course meal at The Ritz (if you had the money and connections).

    Global Warming

    This whole issue is a mish-mash of poor research, information and analysis. Too many scientists and politicians have tried to ride to glory on the back of questionable research and over-stated analysis. Despite the advances in statistical modelling over the last 50 years nobody can yet tell us what the real consequences are or if it was caused by mankind or part of a much longer natural world cycle.

    World Cup Bid

    Perhaps you would like to look a little under the hype and see another set of factors. If FIFA had taken a 'wider' stance in its bid proposal document then none of the Western European countries would have bid in the first place. FIFA brought this scorn upon its own head. Add to that the problems of 'financial impopriety' that have dogged FIFA for years and their stubborn refusal to follow an IOC style response.

    However, they are beeing very short-sighted. The fiancial power lies not with 'the developing football world'. Over the next few years just watch the true power brokers undermine FIFA totally - probably via the club structure.

  • Comment number 92.

    89 stopsupportingcriminals:

    '...........82. At 09:10am on 04 Dec 2010, Not Buzz Windrip wrote:

    "The political system has failed in part"
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    Is there even a single example of the political system in the UK delivering anything substantial and of lasting value to the people of this country in say the last 20 years?...........'

    > What do expect when an empire is lost and the structure is about running an empire. When manufacturing is shipped abroad. When the size of the UK economy is not large enough to develope novel technology and implement it as sales. that is why the opportunity of the financial sector was grabbed, because there was not much else to grab at. Critical to that dependency was regulating the city. the minute government got in bed on a profit share basis via tax streams then the whole thing fell appart.


    ''............82. At 09:10am on 04 Dec 2010, Not Buzz Windrip wrote:

    "It has little to do with bankers at the heart of the matter"
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

    Utterly preposterous............'

    The objective of commerce is monopoly. The objective of government is to prevent monopoly. It is matter of regulation. How difficult would it have been to regulate mortgages at the point of sale. Not at all it would seem, as it is being done now.

    You can huff and puff as much as you like the issue is sound government and consumer habits. Tell me why one of the few prodcuts you can buy, a mortgage has no consumer protection rules about it. Particularly noteable when mortgages are most consumers biggest ever purchase. When mortgages have such an influence on the economy.

    By all means do whatever you want to bankers. It will not sort the problem.

  • Comment number 93.

    90. RD

    'Is there even a single example of the political system in the UK delivering anything substantial and of lasting value to the people of this country in say the last 20 years?

    No, not even the last 50 years.

    It has been all about maintaining the status quo, all about running the country for the benefit of a clique.'

    > And the mechanism is democracy and less than 2/3rds turn out for an election, and the government is decided by less than 5 percent of those who vote in key locations. Wake up.

    The housing market runs mormally on a 2 percent turnover. Double it and you have a boom and dramatically rising prices. Its not rocket science. It is directly related to government policy. It is known what the effects are. Wake up.

  • Comment number 94.

    At the moment there is an obsession with concerns about financial systems. What really matters is the real economy. Financial systems should be designed to serve the needs of the real economy. Abandoning the euro would badly effect the real economy of Germany, as Stephanie's blog confirms. Unfortunately governments at the moment seem willing to accept a great deal of damage to their real economies, by cuts which are bound to slow recovery from the recession for example, in order to prop up broken financial systems.

    There is a risk that by running a scare campaign in Germany an unscrupulous political party could obtain power, and proceed to inflict serious damage on the real economy of Europe, just as is already being done in order to reduce "dangerous" deficits.

    Money and debts or deficits denominated in it, are artifacts which are easily created or destroyed. Central banks do not even need to run printing presses to create more money, it is sufficient to change a few digits in balances stored in a computer.

    Steady inflation, causing negative interest rates and a devaluation of the currency and a few large corporation insolvencies can surprisingly quickly deal with deficits, and result in a redistribution of wealth, which would be beneficial after so many years of the reverse happening under an excessively free market.

  • Comment number 95.

    "The political system has failed in part"

    last 20 years/No, not even the last 50 years

    -------------

    This is not my experience

    1975-79 = Ave, As long has I had money for Ale and Fags I was happy
    1979-83 = Poor, Nest building, 13/14% int.
    1983-95 = good, acheaving and building
    1995-2000 = Excellent,
    2000-05 = std deminishing quickly over this period
    2005-10 = poor, atleast no high interest rate

    So taking the lag into consideration I have been better off under a con government. therefore the system works for me in parts and I can not be included in any clique

  • Comment number 96.

    87. At 11:59am on 04 Dec 2010, John_from_Hendon wrote:

    '..............#86. Not Buzz Windrip wrote:

    "85 jfh"

    The difference between us is that I want to see the greatest good to the greatest number of people - and you want unbridled greed (i.e the failed trickle down system) Please wake up and smell the cordite! You are the discredited and failed past!..........'

    Not at all. I have said what I consider works. As far as I am concerned you have yet to propose anything that will work, all you want to is dismantle which will reduce functionality.

    I find it hilarious when I am exporting, manufacturing ethically, using novel techniques, employing people, retraining people, that you think you can criticise me when by your own acount you have shut down a manufacturing facility decades ago and shipped the work abroad. I would say that was a discredited and failed past somehow.

    Fraud and abuse does not mean a system is beyond use. It means more ethical policing is needed and better regulation is needed. Obviously these are needed because steps have been taken to do both. I have not exonorated the bankers I have said they are not front of the queue for attention. Please concentrate on who benefits from the bankers being a scapegoat.

    I have previous said that there is no sign of the system being reformed in the way you seem to want for this to happen it has to be determined that a crime has happened and whether you and others like it or not the report on the FSA says there was nothing criminal. Therefore the door is shut on your ambitions in that direction. I am not shutting the door, somebody else has.

    You principly post that interst rates are too low for your liking. It is being done to goive a breathing space. Furthermore when the banks want your money they will pay more for it. There is little linkage between BoE rates, Libor rates, high street deposit rates and high street borrowing rates. You also relentlessly go on about M King getting the boot. he is one man, The MC sets the interest rates.

    Now I am afraid I have to get on becasue I appear to be one of the few who post who has work and I am overloaded.

  • Comment number 97.

    91 foredeckdave

    I suggest you research some of the topics beofre you dismiss them. I do not have time to post a thesis or give links. I have posted short form comments. By defintion they do not include everything and they are not even intended to be an overview.

    I really have to get on. I am in the real economy. I do not actually even need to be in this country.

  • Comment number 98.

    Why not 2 euros .... Euro "A" and Euro "B", with promotion and relegation.

    Maybe add more leagues later, sell television rights.

  • Comment number 99.

    98. At 1:26pm on 04 Dec 2010, mikeknowitall wrote:
    Why not 2 euros .... Euro "A" and Euro "B", with promotion and relegation.

    Maybe add more leagues later, sell television rights.


    Also merge with Sterling League (a third Doc Marten League) :}

  • Comment number 100.

    #97 NBW,

    "I really have to get on. I am in the real economy. I do not actually even need to be in this country."

    There we go as usual, making comments and running away - just par for the course from you as a poster.

    I really don't care where you locate yourself. What I do object to is your inability to defend your statements. It appears that you have time to post but are then always too busy to answers questions. That leaves me to wonder what level of understanding you actually have concerning what you write.

 

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