tag:blogger.com,1999:blog-6015463202131716627.post6662534398655296198..comments2014-02-24T00:51:52.707+01:00Comments on The Spanish Disaster: Plight unseenejhhttp://www.blogger.com/profile/01582272075999298935noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-6015463202131716627.post-41654423470811814892013-01-31T22:21:40.198+01:002013-01-31T22:21:40.198+01:00I beg to differ, EJH.
I don't think it will b...I beg to differ, EJH.<br /><br />I don't think it will be allowed to happen. The north needs the south (or the periphery if you like) to be economic basket cases within the euro.<br /><br />Why, because in a time of competative currency devaluation you need all the ballast you can contrive. Whatever the human costs.<br /><br />Yrs etc.<br /><br />The Anonist.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6015463202131716627.post-49278334638380042432013-01-31T10:36:24.226+01:002013-01-31T10:36:24.226+01:00Searching for Project Syndicate led me to Raghuram...Searching for Project Syndicate led me to Raghuram Rajan (coincidentally criticised by Krugman just <a href="http://krugman.blogs.nytimes.com/2013/01/30/calvinist-monetary-economics/" rel="nofollow">yesterday</a>) and <a href="http://en.wikipedia.org/wiki/Raghuram_Rajan#Economic_and_political_views" rel="nofollow">this</a> in particular:<br /><br /><i>In southern Europe, by contrast, it means removing the regulations that protect firms and workers from competition and shrinking the government's presence in a number of areas, in the process eliminating unnecessary, unproductive jobs.</i><br /><br />That's precisely the view I was trying to locate.<br /><br />As far as withdrawal from the Euro is concerned, I basically agree, but only in so far as I think it's going to happen anyway, so why bother with years of economic lunacy first. (As it happens, Spanish withdrawal - or a substantial Euro devaluation - would put an end to my living, but I don't think my personal circumstances should drive Spanish economic policy.) ejhhttps://www.blogger.com/profile/01582272075999298935noreply@blogger.comtag:blogger.com,1999:blog-6015463202131716627.post-80211447422721563322013-01-30T02:19:25.126+01:002013-01-30T02:19:25.126+01:00"If the UK is going in the wrong direction, w..."If the UK is going in the wrong direction, where is Spain going? To correct one policy and leave the other unmentioned is like pointing out the holes in a roof on one side of the street while a house on the other side is swept away by floods.So why? Why the UK and not Spain?"<br /><br />Mainly because the UK has room to manoeuvre as it has its own Central Bank. Spain is pretty much powerless as it made the mistake of giving up its currency and therefore its ability to print money. On top of that the government doesnt have the political leverage to increase fiscal spending as it needs the Euro cores approval to get money to bailout its insolvent banks. The harsh reality is Spains economic policy is determined by the Germans - sad but true.<br /><br />The UK doesnt have these problems. The cardinal sin of Osborne is he can borrow at record low rates and engage in Keynesian style spending along the lines that Obama is doing, but instead refuses to u-turn. Thankfully, the IMF and even some investment bankers are putting pressure on George to change course. Hell, even Boris is telling him to abandon austerity! BlueNut2000https://www.blogger.com/profile/02434432632223756370noreply@blogger.com