Saturday, December 10, 2011

My take on the Euro crisis

Now that a modicum of agreement has been found among the Euro-zone members and that heaps of stupid comments are been made on both sides of the Atlantic about it, today's blog is an attempt of mine to summarize the deal, including its shining aspects and all the dark clouds that still seem to be hanging over it. Generally speaking, each member nation will have to control its deficit and if doesn't, it will get slapped on the wrist.

Before the crisis they had to abide by the same rule, without the enforcement. Of course, if a country strays, will they be any kind of enforcement? I personally doubt it!  Another big question is to see that if, by tightening their wallets, each member of the Euro-zone isn't likely to bring too much austerity into their economy, which might tremendously slowdown business activity and generate a continent-wide recession.

Another big uncertainty is the role of the European Central Bank (ECB) that won't be allowed to print money like the US Federal Bank does to soften everyone's pain. Even though European bank will be able to borrow from the ECB for three years at 1%, yet who is to say that European banks will offer all the loans needed by businesses and individuals?

As for the Brits, I think the die is cast. These guys should revert 100% to their insularity, curl-up, survive and die alone on their island Nation. While they do that, they should quit adding their snotty two-cent to a world that no longer care about their past or present!

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