There’s no indication that this is on the cards soon but it shows how
it CAN be done! Dream on!
xxxxxxxxxx cs
===============================
EVENING STANDARD 19.2.08
Divorce from the euro – Italian style
Gabriel Stein at Lombard Street Research has poked around in the
entrails of the euro, to see how Italy — sorry, a member of Economic
and Monetary Union — could escape and return to the lira — oops,
there I go again. He says it can be done, and that the political
process is now starting.
The short-term pain would be intense, but exit and devaluation may
look better than years of high unemployment, lower wages and spending
cuts.
In the euro's first decade, rising German competitiveness has doubled
its exports to Italy while imports from there are up by only 50%.
Stein assumes that Italians would ship their euros into German banks,
cutting the Italian money supply by a third. The potentially
catastrophic consequences can be avoided by massive central bank
deposits, to be repaid as the money returned into (devalued) new lira.
So don't let anyone tell you it's impossible.
Just make sure that you spend those euro notes with serial numbers
that start with S (Italy) or Y (Greece).
it CAN be done! Dream on!
xxxxxxxxxx cs
===============================
EVENING STANDARD 19.2.08
Divorce from the euro – Italian style
Gabriel Stein at Lombard Street Research has poked around in the
entrails of the euro, to see how Italy — sorry, a member of Economic
and Monetary Union — could escape and return to the lira — oops,
there I go again. He says it can be done, and that the political
process is now starting.
The short-term pain would be intense, but exit and devaluation may
look better than years of high unemployment, lower wages and spending
cuts.
In the euro's first decade, rising German competitiveness has doubled
its exports to Italy while imports from there are up by only 50%.
Stein assumes that Italians would ship their euros into German banks,
cutting the Italian money supply by a third. The potentially
catastrophic consequences can be avoided by massive central bank
deposits, to be repaid as the money returned into (devalued) new lira.
So don't let anyone tell you it's impossible.
Just make sure that you spend those euro notes with serial numbers
that start with S (Italy) or Y (Greece).
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