Tuesday, June 26, 2012

Euro Solutions

I receive a regular email from John Mauldin and last night he made this comment which sums up the Euro dilemma nicely...

"I continue to believe that Europe in general and Germany in particular have no good choices. They can only choose between Disaster A, which is keeping the eurozone together, and Disaster B, which is breaking the eurozone apart. Either will cost trillions of euros and mean much pain. It is not a choice of pain or no pain. It is simply a decision as to what type of pain you want and in what doses you want to take it. Choose wisely."

The email from John contains various commentary that continues to speculate on different options to resolve the crisis. The most interesting suggestion is that the EuroZone should kick Germany out of the monetary union as it is Germany that refuses to agree with the others. Without Germany, the rest of the Zone can monetise it's debt, devalue it's currency and create inflation. Something they have always done prior to joining the EuroZone.

All very interesting.

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