Shocking discovery: Europeans can blog

Dear reader,

don't you worry ... the author here hasn't joined Business Insider and will try to avoid hefty headlines in future ;-)
But since the initial Bruegel blog statement 'Europeans can't blog' stirred up some discussion about the quality of blogging among European economists they (Jérémie Cohen-Setton, Éric Monnet) now contradict their own initial statement by publishing this excellent piece: Blogs review: The Gold Standard and the Euro



By including 21 (twenty-one) links to other fine pieces published earlier by esteemed economists from both sides of the Atlantic (and adding some insight from leading politicians as well) they set a shining example of what they really had in mind by issuing their first statement. Not to insult hobby bloggers using their mother tongue to express perhaps share their amateurs views with their fellow blogging enthusiasts, but to inspire professional economists and policy makers to not just use their blogs to trumped their perspective to economy in general or to comment on events/needs of the eurozone. A call to insert more references to the work of others in order to have more context and not to spend hours to search for other pieces on the same or similar subjects . Not only to empower their readership to verify their comments on the findings of others but also to interact with those they refer to. Of course this is only the first step in order to open a real debate.

To be even more efficient it could be recommended that everyone, commenting on pieces issued before by others, inform those authors by sending them just the title and a link to their latest piece by Twitter. In order to follow a new debate upon a specific topic a unique hashtag would also be helpful. But that 'creative discipline' wasn't observed even by this author here who knew perfectly well how beneficial that would have been but creativity often goes along with laziness ;-)

Blogging isn't the only thing Europeans can't do

Dear reader,

this is already the 4th entry written after the initial posting issued by Bruegel institute which provoked a wide range of responses so far. After reading some more 'negative' reactions on this initial debate starter it seems a necessity to remind fellow European citizens what we can and can't do. As in what we are currently doing (pretty little) and what we could do in the future instead. This applies to many different areas which the author here describes in chapters.


Part I - common language

Since the debate is already invoking some interesting thoughts it's already a little success story. While @Wirtschaftswurm is basically following Mr Lochmaier and his views that we Europeans are being influenced too much by those Anglo-American developments he also brought up the very important subject of 'natural cross language communication' vs 'Google translate'. He, the worm, is right that the translation product offered by google still has it's problems and isn't a match for skilled human translators who not only Know the words but are capable to understand the context of words used in this or that or the completely other meaning. (very often translation isn't unambiguous and several translations are possible depending on the context of the original)

National fiscal policies to counter ECB's main dilemma

Dear reader,

just after reading this latest excellent piece posted on voxeu.org:

Housing bubbles and interest rates

and by remembering one of the main problems (if not the biggest problem) of the ECB monetary policy for the eurozone the author has some additional thoughts to his earlier posting:

The problem arising from the 'just now discovered' lack of convergence of individual economies, due to a 'initial construction fault' or a lack of a closer look back then, when the EU was about to come into life, is that whenever the ECB implements monetary measures fitting the 'Neuro-countries' (or core countries) like higher base interest rate to counter inflationary tendencies ,the results will be a deflation in those 'Seuro-countries' (or eurozone periphery) and vice versa. So what is good for the one group is harmful for the other.

So instead of whining about the initial construction faults of the eurozone or countries sneaking in which never belonged in the club anyway, it is much better to concentrate on solutions to fix those problems. Just like it was not necessary to maneuver the Hubble-telescope to the space junkyard after they attached some correctional mirrors ('glasses') later.

So the ECB was designed to take measures for the whole eurozone because it was assumed that those economies would be more or less equal and just as there are many different individual problems which cannot all be tackled by 'one fits all' approach of 'austerity no matter what' it is still possible for individual member states to get 'early warning signs' from ECB and their own central banks where in their economy there are bubbles in the making and before they burst (as they usually do and usually produce some misery) they can be tackled by taxation or other means of legislation. It is conceivable that after individual member states tackled their problems, a coordinated fiscal or legislative 'fine tuning policy' besides the 'big broom' (interest rates) of the ECB is applied for all members of core and another, better fitting 'fine tuning' for the periphery.

No doubt that all of that coordinated ECB and governmental steering would be quite new* but unconventional times need unconventional measures. This is not purely 'hypothetical' since today# Mr Klaas Knot, president of DNB (Dutch central bank) called upon the Government again+ to adjust the 'hypotheekrenteaftrek' (tax deductible mortgage interest payments) in order to tackle the over indebted real estate sector. It's a bit ironic when in the past there was a tendency by governments to influence the central bank of their country now it's the independent central banks who require the governments to comply to their findings. But there is not just a coordination of monetary and fiscal policy needed as the author here suggested more than once. The so far under represented growth policy should be added to the other two at once. Coincidentally this is also one point Mr Klaas Knot was making in his earlier policy speech: The future of EMU and Netherlands' place in Europe(BIS)(pdf,eng)

If the reader has missed earlier blog entries by this author it needs to be added that growth can and should be stimulated by other measures than just fiscal stimulus. A plan for a 'modernized eurozone' should be implemented as well as coordinated export policies. For both there are some more detailed entries available already here across this blog.




# = Mar 29th 2012 Knot: Catshuis-overleg mág niet mislukken (dut)
+ = Nov 02nd 2011 DNB wil hypotheekrenteaftrek beperken (dut)
* = an assumption, feel free to comment if there are some examples to prove or to discard this thesis.

[update]

Dutch research institute CPB (@centraalpb) on Tobin tax:

"A VAT on financial services, a bank tax or a tax on financial activity would be more efficient the CPB says in a finding that was made by request of the cabinet."CPB: "Financial transaction tax not efficient" 

[/update]

Europe speaks German ! (# Bruegel: 'Europeans can't blog')

Dear reader,

of course in reality it doesn't but that particular title comes to mind when reading one contribution of the 'Bruegel debate' which was brought to the author's attention: (by Dirk Elsner @blicklog)

 Wirtschaftsblogs: Europäer können bloggen, aber nicht englisch
(economic blogs: Europeans can blog but not English)

Here are some comments in English and German to Mr Lochmaier's piece:

he wrote: "Es mangele uns quasi an Professionalität und Weisheit. Das wiederum hat zu einer teils bizarren, teils interessanten Debatte geführt, die ich versuche in einen größeren Kontext einzuordnen." "There is practically a lack of  professionalism and wisdom. That has led to a partially bizarre , partially interesting debate, which i try to put in a wider context" 

Well, it seems he as many others felt somehow offended and by just reading the headline of Bruegel* blog's initial criticism some people missed the point completely: The authors of Bruegel never said there was a 'lack of professionalism and wisdom'. What they wanted to point out that there was a lack of communication/interaction between those fine European economists. Which is something completely different (IMHO they got it right!)

Yes Europeans learn how to blog (# Bruegel: 'Europeans can't blog')

Dear reader,

this morning a tweet by Dirk Elsner (@blicklog) showed that he was still moved by the "Bruegel controversy" and in a remarkable new blog entry (ger) he defended the European blogs once more but conceded that Bruegel had at least one point when they say that there is a lack of interconnection between authors.

Mr Elsner is right to defend the efforts of all the fine men and women who are offering the public their views, analysis and even some provocations as food for thought. The author here also likes the challenge of reading many different points of view since the current crisis of the common European currency doesn't offer a single or easy or even known solution.

In order to add some new perspective to the ongoing discussion let me say that the criticism of Bruegel also has some truth by exposing the just emerging ability of some highly respected economists to use the possibilities of direct communication to the reader by using tools like Twitter or blogs. While in the past they either had to depend and to rely on publishers who did the 'dirty work' for them. Some of the professors could concentrate on their science and from time to time could publish their work by sending it to their publishers. Be it in order to release a new book or just a newspaper article. Since the crisis in the eurozone hardly give anyone the time to respond to it in form of a book we see many newspapers who are keen to release the views of the most respected economists from all over Europe and nowadays we even see central bankers while still on their post to release their point of view and their explanations for their actions to the public.

Germany begins EU referendum debate ?

Dear reader,

first of all the author must confess to be allergic against some nonfactual stuff he encounters while reading articles brought to his attention. As he made it clear in his short profile of eurozoneremarks ... he loves facts and hates BS ... he was suddenly reminded of the latter by a tweet originating from @raluca3000 which contained an article by the Irish Times. A newspaper the author also likes to retweet for its usually superb content but he guesses that once in a while even a superb paper can produce a glitch. He also wants to point out that usually tweets of @raluca3000 are more than just OK ..they almost have a perfect record of hitting bulls eye.

So here is the article in question:

Germany begins EU referendum debate with one eye on its past (Irish Times)

The author usually reads articles very fast and comprehends their content but in this case he started to think twice ..wondering if he didn't catch some latest developments before questioning the content of Mr Scally. So the first thing the author here was wondering about was the sentence:  


"Germans don’t speak lightly of referendums. Its postwar democratic model was fashioned on indirect, parliamentary legitimation,a response to Hitler’s disastrous manipulation of direct democracy to abolish democracy and establish a dictatorship"
 
Hmmm.... what disastrous manipulation is he (Scally) referring to ? Anybody less clueless than the author here (feel free to give a hint by posting a comment) As far as the author here studies German history for more than 30 years he does not know what event was possibly on Mr Scally's mind. There was not a referendum bringing Mr Hitler to power nor was there any referendum used to abolish any posts or laws by his later government. The most problematic elements of "Weimarer Verfassung"(inofficial name) were: The power of the president of the Reich which was could dissolve parliament, "hire and fire" the Chancellor and was Commander in Chief and could issue "Notverordnungen" to react to immediate dangers for the state but were in fact dictatorial powers. 
In fact the post was a replacement of the former Kaiser.  So before Mr Hitler came to power there was no referendum as a "disastrous manipulation of direct democracy" and there wasn't one after he got the post as Chancellor either. It is fact that some rather dangerous elements of "Weimarer Verfassung" have been altered in the 1949 Version of (West)German "Grundgesetz" but the lack of referendum due to Hitler's fatal rule is rather a myth:


Obviously it is not the first time it has occured so that there is even a comment to be found in an article of Wikipedia. It says (in German: paragraph "Geschichte"): 
"The thesis that there were 'unpleasant Weimar experiences' with a plebiscite often serves as an explanation of their omission in the Grundgesetz. On what it grounds and why this view is so widespread is unclear. "

The second time the author here started to wonder about was the fact that two unnamed "leading law professors from Heidelberg" were calling for such a referendum. So although he was offline for 2-3 days in a row he kept listening to excellent German broadcaster DLF and kept also watching German TV but cannot recall seeing or hearing anything concerning that particular matter. By using Google he came along this article: Phoenix-Runde mit Degenhart but the professor in favor of a referendum in it is obviously from Leipzig.

So as always it is much more than just a courtesy to have the full names of people in order to identify them or what they supposedly have said. Not just "professors of Heidelberg" or also very popular by other news sources: "by German politician/lawmaker" ... well there are plenty of them ;-)

Maybe there was a debate present in a certain corner of German ivory tower that even managed to fly beneath this writer's radar undetected. Who knows ... If so ...some articles preferably in German would need to be put on the table. The author here would be delighted to have such a debate published on eurozoneremarks. 



Weimarer Verfassung
Prof. Dr. Cristoph Degenhart

The vantage point of the frog

Dear reader,

just before the author has to leave office he came across this article written by Dutch economist Mathijs Bouman:

bad housing market pushes down consumption   (Z24.nl)(dut)

This is very much the effect of what i described in my last comment hailing Bruegel blog analysis where they say that a closer interconnection of European economists is needed.

So while Mathijs Bouman (as always) delivers a perfect analysis from the limited viewpoint of the frog (As Dutch people sometimes refer to their country as: "ons klein kikkertjesland"  (our little froggy country) it could give Dutch people the impression. Well , that's it. That's the full story of our economic decline. The most likely explanation for the predicted bad numbers on future budget deficits and  GDP growth.

Which it isn't of course.

Unfortunately the wider European analysis of this author here hasn't left its draft status, but in it there are already some indications of what exactly happened in order to split the former "economic Siamese twins" Germany and The Netherlands.

[update]
Mar 31st 2012 German wage deal agreed, averts public-sector strike (via @ewaldeng) 
Mar 31st 2012 German retailers turnover drops 2nd month in succession # (Die Welt)
Mar 30th 2012 German shoppers drive growth (paywall)
[/update]


# = German language


note: The author is fully aware of the fact that usually the French are referred to by some British fellows as 'frogs' and he is a frog (=Dutch) himself.

That's why Bruegel has made a good point (# Bruegel:'Europeans can't blog')

Dear reader,

yesterday the author received a short message on his Twitter channel originating from esteemed blogging author @blicklog:

"New Bruegel-Blog ist starting quite arrogant and with little knowledge about European Blogosphere http://www.bruegel.org/blog/detail/article/708-europeans-cant-blog" (Mar 17th 18.03 CET)

So the immediate response to his assumtion of Bruegel-blog being "arrogant and with little knowledge" @blicklog received a tweet which said that he should look what they (bruegel) wrote at the very end of their blog entry which is that is not the intention to offend anyone.

Having said so for the immediate defense of Bruegel and driven by the simple fact that Twitter and its 140 characters limited tweets are hardly enough to discuss matters deeper it was decided to use this blog entry in order to make a few remarks on that matter , too.

As it is the intention of this project "Eurozoneremarks" to deliver as much and as detailed and accurate information to readers in Europe and beyond it was decided to use mainly the English language to be able to reach as many different European citizens as possible since English is the language most commonly used on the planet. In order to enhance the understanding of what other fine European brains like that of Mr Paul de Grauwe think and produce it was translated into a language of those individuals it was intended for ;-)

The ECB is just the fire fighter, arsonists acted before

Dear reader,

in a reply to a tweet of @Tiefseher posted on March 12th 2012 1400 CET which said (in German) :"The ECB now acts (loosely) according to Helmut Schmidt: preferably 5% inflation instead of 15% unemployment"

>>Helmut Schmidt:

• "Mir scheint, daß das Deutsche Volk – zugespitzt – 5% Preisanstieg eher vertragen kann, als 5% Arbeitslosigkeit." - Süddeutsche Zeitung, 28. Juli 1972, S. 8

• auch zitiert als: "Lieber fünf Prozent Inflation als fünf Prozent Arbeitslosigkeit." - zugeschrieben von www.spiegel.de (Stand 04/07)<<

source: Wikiquote (ger)

So Helmut Schmidt did not speak of 15% unemployment (which is of course much more than just 5%) but also presumes that the German people are more capable of bearing 5% inflation than 5% unemployment. (quote from just before oil crisis of 1973)

What the ECB did in fact with its LTRO actions was preventing a collapse of European states and the Euro currency itself, when prior action of all major central banks of the world did its part to prevent world wide financial disaster by the dollar swap easing. The first LTRO was conducted only a few days later , right before Christmas in order to prevent a complete dry up of funding of southern European states where interest rates of such sovereign bonds were just going through the roof (of 7%) and some auctions didn't attract any buyers ! One mustn't forget the anxiety which was present in those days not too long ago, when some economists started publicly to recommend buying farm land in order to be able to survive on home grown vegetables ! (No joke, happened in NL)

We are all aware of the fact that basically the ECB action wasn't appropriate according to solid European standards of central banking but it is as if someone demands a rereading of fire prevention rules and insists tenants must install smoke detectors while the apartment building in question is indulged in flames and the fire fighters are about to engage in order to fight the blaze caused by one tenant who obviously didn't follow the rules. So it would be a wise thing to put out the fire without discussion of how the hoses have to be connected properly together and afterwards, while the smoldering ruins are cooling down, there would be time for implementing measures of fire prevention in order not to let disaster strike twice !

Coming back to the ECB and the Bundesbank it is worth mentioning that traditional ally of the Bundesbank -the DNB - of The Netherlands and its current president Mr Klaas Knot had soften its position. Shifting away to a certain degree from 'orthodoxy' of the Bundesbank. It is communicated by Mr Knot on Dutch public TV in a remarkable first live TV interview (mainly because of the to be expected reduction of pensions) but also expressed here in this statement by Mr Knot. So it is pointed out by DNB as well as by Dutch finmin De Jager that in principle The Netherlands shared 'German values' of sound public finances and restrictive monetary policy but is more flexible when it comes to saving a system which might otherwise break down. (One might call it 'Dutch pragmatism')

The problem of the ECB to react to crisis by recent LTRO actions was created long before in the very beginning of the eurozone by letting countries join the union which never complied to the strict rules of Maastricht. So in the case of Greece the books were cooked but anyone with knowledge of prior Greek economic data could see the 'magic'. And all politicians of the eurozone ignored the fact that some members were simply not capable of sustaining their debt levels because of insufficient economic performance. All problems were dramatically exposed by the fallout of the US subprime crisis after reaching its peak by the collapse of Lehman Bros. and almost collapse of AIG finally hitting Europe. We know perfectly well what caused the crisis and what consequences were looming for not only the eurozone but for the financial system of the globe. It's fair to assume that after the crash of eurozone, the rest of EU would have sucked into the abyss too and when misery would have hit the UK it would have  then reached North America and Asia.

As a former believer in the high quality of monetary policy by German Bundesbank and Dutch DNB alike and as a fan of their greatest presidents like Wim Duisenberg, Helmut Schlesinger, Karl-Otto Pöhl etc the anger of @Tiefseher can be fully understood but as a person fully committed to the well being of our businesses and citizens alike it doesn't make sense just to look back to see the mistakes and misery of the past. Instead we should look forward and try to make things finally work. Even when they had some design flaws since the days they were created. It's not wise to speculate on the chaotic breakdown of the eurozone since a revised 'rerun' of history seems to be almost impossible. Perhaps some roads to a sustainable 'Neuro' and 'Seuro' (northern and southern eurozone) can be discovered without a too negative impact on our economies. We should focus on that and should not want to scuttle the hole thing. In German language the restrained frustration is expressed by: "Eine Faust in der Tasche machen"

[update Mar 12, 2012]
So it's worth to balance the possible thread of inflation and those negative long term effects on the currency holders against the immediate "full inflation" effect of wiping out the currency immediately and let Europe and the world tumble in financial chaos
[/update]


Some related links:

E.U. Bank Crisis Only Narrowly Averted Catastrophe
Q&A: dollar swaps – why central banks are acting together on eurozone crisis
volkswirtschaft.blog.de (ger)
Klaas Knot: The future of EMU and the Netherlands' place in Europe (pdf)

Liquidity released, bubbles ahead, how to regain control ?

Dear reader,

Let there be no mistake. Since the ECB decided to fire its 'bazooka' there is a relief of tensions in the sovereign bond market of those candidates in the Eurozone this move was intended for. By releasing its massive liquidity to the banks of eurozone it basically offered (almost) free money for everyones grabs.
So far indicators such as overnight deposit of banks at the ECB show ever growing astronomical figures. Clearly showing that interbank lending is still way off a situation which could be described as 'normal'.

We see an influx of the massive liquidity released by the ECB in order to prevent first the collapse of member states of the EMU and then of the Euro as currency without its members and their central banks. States were at the brink of running dry of funding, creating a realistic danger of the breakdown of their societies when wages of state employees couldn't be paid anymore or social benefits, pensions etc.

Jeremy Warner: 'Britain can do without a Pol Pot of banking'

Dear reader,

yesterday evening an article writtten by Jeremy Warner came to the authors attention, which immediately prompted some remarks concerning a misconception of the task(s) of the German state owned KfW bank. But not only some important information on the German banking model was left out in order to write a peppered article against the plans of Vince Cable but also the provocative headline is worth to get some remarks. Not only because neither Vince Cable as a politician nor any British citizen, bank or whatever entity can be compared to a BUTCHER like 'Pol Pot' who slaughtered at least some 1 1/2 million of his people.
'Pol Pot' being an ultra-communist who struggled to enforce some stone age-communism on his country.

In general the author here likes both The Telegraph  newspaper and the author of the questionable article because of their critical vision on the eurozone, the Euro currency etc without a vision of political correctness. But when there are comparisons to mass murders of history used to make a certain point instead of using the pure facts it is worth to get a comment.

Britain can do without a Pol Pot of banking (Telegraph)
Cable: Government lacks 'compelling vision' (BBC)

Taxpayers' loss in RBS and Lloyds bank stakes stands at £40bn (Guardian)

KfW Bankengruppe (Wiki, ger)

European political euphemisms, BS exposed

Dear reader,
Since some of those 'standardized junk statements' are being used across the board by politicians of several countries throughout the eurozone it is planned to compile a list of politicians using more or less the same bull. So as always this blog entry will grow in the next couple of weeks with the most painstaking nonsense issued by well known European politicians.


outright BS:


Rutte: "Euro is nevertheless good business" NOS (dutch public TV) (dut)


Yeah sure .. without Euro we poor Eurozonians would have all been fallen pray to very dangerous, greedy speculators and our countries would have been wiped off the map ... As the UK, Poland, Norway, Switzerland all vanished during the turmoil of the financial crisis of 2008. 

Target: Sustainability

Dear reader,

following the new 'doctrine' of this blog this is the explicit opinion section.  Concerning the latest Bundesbank Target debate where to the best of the authors ability all arguments for the topic have been lined up. (If you have some more please feel free to add additional suggestions as a comment)

Of course the author has an opinion concerning this aspect of the eurozone as well which is that this is yet another flaw in the 'system eurozone' not foreseen or better ignored by its founders. Yet another 'politics' before 'economic realities' example where the obvious main goal is somehow to cover up the naked, cruel truth in order never to be forced to admit a mistake. Yes of course it is currently working this system covering up the imbalances of trade and its marks it leaves on the balance sheets of banks involved in the payment clearance.

And it's true as long as the system isn't breaking up everything is fine and nothing to worry about. Except of course that there is a danger never to get any refund for delivery of goods and service to another customer even as big as a country. If this blows up my earlier thesis, that would be little difference to produce goods covered by loans (possible guaranteed for by the local government) , give the producer and its employees some cash flow and a little extra and then dumping the produced goods into the sea.

I like to remind every economist of my perhaps idealistic view that this profession is to analyze in order to expose weaknesses of economic models and thereby making it possible to eliminate those flaws in the system or even better to prevent them happening in the first place. You might consider me a 'radical' when I say that the economy is much more than a academic playground to fulfill live lasting academic mind games. It may sound 'basic' when it is said that the economy is about peoples lives , livelihoods … the difference between starvation or having a life worth living. As we can currently see in its most extreme form in Greece sometimes even a question of life and DEATH, when people commit suicide. This weighs much more than hypothetical questions like 'Giffen goods' where some economists even dare to use humans as guinea-pigs just to be able to finally prove their assumptions for most extreme scenarios. Sometimes one feels reminded to some Hollywood blockbuster movies such as 'Independence day' where a somewhat nutty professor is finally confronted with the reality when the president and his staff visits him in his underground research facility where he made isolated experiments all his life. And he cannot hide his excitement to tell president about all the funny gizmo's he an his team were able to discover and to at least partially to comprehend their functions. Only when the president reminds him harshly that this isn't fun when the existence of the entire human race is depending on this research and that those ships and those creatures are not funny toys but archenemies of the human race the professor realizes that research is more about practical results than about personal fun.

Coming back to the economy i also like to remind people that a complete failure of the system not only bring economic pain and misery to millions of people but there looms also the danger of elements in some (if not all) of our societies of political forces calling themselves 'socialists' but being either communists or fascists. Therefore a failure of our beloved capitalism also brings the real danger of dark forces taking over pretending to the people to have a better working 'solution' . We all know that this almost inevitably goes along with suppression. If the weakest link in the eurozone – Greece – goes down we will see that the traditionally strong local communists will take over the country !

Therefore the working of our economic model be it in the 'real economy' or the part responsible for a working payment/finance system – the banking sector – has to be guaranteed !

And therefore it is necessary to find the weaknesses in the system and eliminate them and not in order to be 'politically correct' to cover them up in order not to put any blame to the systems inventors. If there are misconceptions it is also worth to discuss those openly as it is being done hopefully in the blog entry referred to above. There are followers of professor Sinn and there are others with arguments against his latest findings (which are according to his statement in 'Der Spiegel' brought to his knowledge by no other than Helmut Schlesinger !)

The author reiterates his point that in principle he his in favor of a sustainable Euro currency and if there are inherent dangers to this system they must be eliminated. The idea of 'stop loss' by Beate Reszat isn't a bad one since it is showing the ability to quit something which isn't sustainable in the long run. This doesn't mean to abolish the Euro altogether but at least considering to let go those most damaging imbalances which threaten the system as a whole ! The dangers coming with it described above. It was a grave mistake to have the eurozone created with many candidates not being worth in it back then and even more so today. So now we got into this mess and it is always a first step to analyse the problem in order to get a solution. It is damaging for the system as a whole to say 'We have to save the Euro whatever the costs'. (Merkel) That's the opposite of 'stop loss' meaning 'losses forever' and what that finally means we all could see in the downfall of the Comecon System of the East. Speaking of the East: Poland and others already got 'cold feet' joining the eurozone and who can blame them not being stupid ? Or the current UK and perhaps future independent Scotland already facing the question: able to keep the pound or being forced by European treaties to join the club of financial turmoil. So it is necessary to solve the old problems of the zone first before other (possibly good candidates) join the club !

Also a reminder to politicians (once again) such as Chancellor Merkel from the East and some younger ones from the West that the Euro is 'just' a tool for payment. Not a holy grail producing wealth on it's own. (Please check the Dutch study here as well) There was an economic life before the introduction of the Euro currency albeit it somewhat (1-2%?) more expensive for currency exchange and a bit more stress by maintaining the currency exchange rates on a daily basis. And as we all can see the UK, Poland and others doing fine without the 'holy cow' and even survived the turmoil of the big financial crisis of 2008 where those politicians always warned us that without the Euro we all would have vanished ;-) Well the Brits, the Poles and others are still alive and well and so is there currency without being eaten alive by 'speculators'

So the final message is (once again) : please check all possible real vulnerabilities of our system thoroughly instead of being afraid to discover some loopholes or threats which collide with political will not to blame anyone or to put the Euro project in question. It is always better to adjust than to fail completely which we were close to already only averted by LTRO action by the ECB. Also look into other imbalances as well as real dangers besides the usual two strong arguments: Low inflation & strong standing against the USD !
The ECB points out just after the fiscal treaty has been agreed on that they have done their part in order to save the project for now. They added of course the inconvenient pledge to politicians now to do their homework. In order to do the right things later all problems must be seen first and without a politically correct view and without any tunnel vision.