Czech Republic Wants Out From The Single Currency
Could The Euro Currency End Up Abandoned?
The EU agreed on the plan to help Ireland, a plan which was set at a value of 85 billion euros. After Iceland, the Czech Republic heard through the President Vaclav Klaus‘s voice, evoked the possibility of negotiating the right to abandon the single currency.
While thousands of Americans in the U.S. formed endless lines to fully benefit from discounts on the eve of the traditional winter holidays, EU finance ministers are preparing to discuss the situation in Ireland. Saturday, at least 50,000 protested in downtown Ireland, Dublin, against draconian austerity plan submitted as a condition sine qua non for getting a major international financial aid, and EU-backed International Monetary Fund (IMF), seven months after credit of 110 billion euros for Greece.
A significant part (35 billion) of this program will help to redress the Irish banking sector, strongly affected by the housing bubble burst. The rest will remain static; whose deficit jumped to 32.1% of GDP target is required to reduce the deficit from 9.1% to 5.5% in 2011 and 2013. To achieve this, Ireland will follow in the next four years, a severe financial diet, which means savings of 15 billion euros (spending cuts of 15 billion euros and 5 billion additional revenues from increased taxes). Meanwhile, overseas, the first preliminary results of acquisitions over money were disappointed: the U.S. consumer spent with prudent-Dent. The number of buyers has increased over last year, 2.2%, below analysts’ forecasts of 3% and total sales value has increased by only 0.3% compared to 2009. “People prefer to wait for better days,” the experts concluded, emphasizing the pessimism that swept American society.
An increased sense of pessimism, coupled with a strong distrust, characterized, moreover, and European markets, which closed down last week. A surprising close, moreover, amid speculation about the fate of the euro in particular, and the EU in general. After experts have estimated that Citigroup European stabilization fund, 750 billion, have increased from 2,000 billion to survive the wave of crises that will affect the next five years, the old continent (event evoked by the Governor Bundesbank Axel Weber), the Czech President Vaclav Klaus, a known euro-skeptic, has expressed his wish that his country’s government to negotiate with Brussels the right to abandon the euro. Eve, the famous American economist, Nouriel Roubini, I think that to save the EU should abandon the euro area and countries to return to their national currencies. Europe has all the tools to cope with other crises, like those of Greece and Ireland, said in this context, European Commission President Jose Manuel Barroso. “Europe must defend its currency, launched, in turn, Belgian Finance Minister Didier Reynders, whose country has the rotating EU presidency.
But experts do not believe in words and still fear that other countries such as Portugal, Spain, Italy and Cyprus, will be contaminated by the fall in Ireland. Since-and point of view, they talk first with disbelief. “Confidence grows with the economy. When the evolution of GDP squeak, in turn confidence falters, analysts say, comparing the situation in Europe with a domino effect, where a simple piece could train the entire scaffolding collapse. And that lack of trust depreciating euro. In this framework involved speculators, which focuses a country considered fragile financial positions down, maintaining a state of panic and alarmist rumors. And all politicians involved in this framework, trying to blow away the fear, to prevent a disaster.11
