At the nightmare he once dreamed of blissfully:
"The euro must break up
Or else we must take up
The topic of joining fiscally."
Among the 9 Economic Myths deconstructed by Cullen Roche in his Pragmatic Capitalist blog is that of the euro: specifically, that the euro has been saved by the ECB's LTRO (long-term refinancing operation). Euro-zone banks have borrowed a net €520 billion of 3-year LTRO loans, which the ECB hopes will encourage liquidity and lending among the banks in its member countries. Unfortunately, this is another example of can-kicking. Says Mr. Roche:
The problem in Europe is simple. Because none of the countries are autonomous currency issuers, they all suffer from solvency constraints. They can’t print euro without the approval of a foreign central bank, in essence. So, unlike the USA, they can “run out of money”. This makes for frightened bond investors. The problems all arise out of the [intra-European] trade imbalance, which essentially forces the core to lend to the periphery to maintain growth. This is only sustainable up to a point and that point has been reached.Hat tip to the Reformed Broker, Josh Brown.
Posts
25A285B6BA
ReplyDeleteMany online resources are available for creative design enthusiasts, making it easier to learn new techniques and improve skills. One such platform is dtfhub.com, which offers a variety of tutorials and tools tailored for digital artists. Whether you're a beginner or a seasoned professional, exploring this site can provide valuable insights to enhance your projects. Remember to visit dtfhub.com for the latest updates and resources.