Archive for the ‘Europe’ Category

Joachim Voth, professor of economics at Pompeu Fabra in Barcelona, describes and discusses four scenarios for the Euro’s future:

We are destroying a huge amount of the good work created by the European Union, almost over night as a result of the current policy mix.

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After the great success in recent British elections, UKIP leader Nigel Farage might have more influence on British politics. Thus it is interesting to hear his current thoughts on the Euro crisis:

The big question is: What is the European Union for?
And I think that the alternative model is a Europe based on cooperation, a Europe based on trade, a Europe based on nation-state democracy. This is a vision that can only grow in support as the years go by.

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expropriation

The most recent EU summit on Cyprus brought to light a new instrument to tackle the debt crisis: expropriation.

While German newspapers call it a fourth stage of the Euro rescue, Business Insider finds more drastic words:

This Crazy Cyprus Deal Could Screw Up A Lot More Than Cyprus…

What do you think those other depositors in Spain, Italy, Greece, etc., are going to feel like doing when they realize that, if their banks ever need a bailout, they might have their deposits seized?

In addition, I would raise two general questions:

  1. What guarantee is there that this was a one-time intervention?
  2. What happens if this ‘strategy’ is imposed in France or Germany?

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Every now and then politics goes beyond the normal stupidity. Yesterday, for instance, the European Union decided to ‘abolish’ youth unemployment:

EU ministers agree Youth Guarantee

A six billion euro pot in the EU budget has already been set aside to tackle youth employment in regions with jobless rates of around 25%.

Mr Barroso said it was a sad fact that there are both high levels of unemployment and skill shortages across Europe.

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eu referendum

David Cameron, the Prime Minister of the United Kingdom, announced that he wants the British people to have an in-or-out vote on Britain’s membership in the European Union. Not surprisingly, he received harsh criticism from almost all leading politicians in Europe. That leaves me with a question: Why are the European leaders so afraid of a referendum?

As far as I can see, there are three options:

  1. The EU has been a great success and voters appreciate this.
  2. The EU has been a great success but the ordinary voter is too dumb to appreciate this.
  3. The EU has become a bureaucratic mess and voters increasingly dislike their country’s membership.

So, if leading politicians reject the idea of a British referendum they implicitly argue that the first option is false (otherwise a referendum would simply support Britain’s membership). Which leaves me to conclude that either politicians regard voters as sheep or they fear the voters might get the opportunity to judge the mess in Brussels.

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For the New York Times, Stefan Homburg, professor of economics, presents three reasons why Germany should leave the Euro zone:

Germany Should Leave

The protective measures of the Maastricht treaty have all been breached.

It makes no sense to export on credit when the credit is ultimately repaid by the German taxpayer.

Adherence to the common currency is apt to poison Europe’s political atmosphere all the more.

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impressions of london

Had a couple of great days in London and here are some impressions:

London in 2012

London in 2012

Big Ben and Churchill

Big Ben and Churchill

London School of Economics (LSE)

London School of Economics (LSE)

Tower Bridge

Tower Bridge

The Shard

The Shard

Buckingham Palace

Buckingham Palace

St.Paul's Cathedral

St.Paul’s Cathedral

Fish and Chips

Fish and Chips

Cookery Book for the Working Classes

Cookery Book for the Working Classes

View of London from Paramount

View of London from Paramount

 

 

 

 

 

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