The Euro is a credible currency

Quantitative Easing (which used to be called deficit monetization) is justified – in this clip – by ECB president Jean Claude Trichet. Monetary policy works…. eventually, and when it does it tends to result in high levels of inflation.

Some people said the Euro wouldn’t last a decade, for our part, we hope that they are proven to be wrong, the will of society is a very powerful incentive and can be the difference between what should happen in theory and what actually occurs, for that reason I think the Euro will pull through but there will need to be some serious changes made in the way that the Eurozone manages itself.

Comments

  1. Mossy Heneberry

    But the Euro is a fiat currency. It has no intrinsic value, nothing tangible backs it up. Like all fiat currencies it will eventually go to zero.

  2. @Mossy – fair point on the fiat currency angle (assume you’re a goldbug!), but at the same time, currency is really about confidence and if confidence rests in a fiat currency then it becomes de facto currency, I believe this is definitely true with USD for instance.

Leave a Comment

Awesome! You've decided to leave a comment. Please keep in mind that comments are moderated.