Post by Jaga on Jun 23, 2010 10:25:40 GMT -7
Will EU survive? I believe that in a long run Europe would be united but EU is just a first attempt which may not survive the challenge
FRANKFURT -- For an entire generation of European leaders, the euro coins jangling in their pockets are more than just a currency. They are a powerful driver of political unity on a continent where people speak more than two dozen languages and spent much of the 20th century fighting each other.
Now, as the euro faces a challenge like none before, the question is whether the currency will last.
The debt crisis that began in Greece and menaces half a dozen other European nations has caused the euro to lose 15 percent of its value relative to the dollar since January. Some economists consider it obvious that the currency union will not survive in its current form, that one or more southern European nations will end up reverting to liras, pesetas and drachmas.
That leaves the future of European unity to be decided not merely by politicians in Paris, Berlin and other capitals, but in a glass skyscraper in this banking hub, by a French banker named Jean-Claude Trichet and his 1,600 employees. Less than a decade after cash machines across the continent started spitting out the same currency -- and less than a month after it laid the cornerstone for a new permanent headquarters -- the European Central Bank is facing extraordinary pressure to keep the euro, and Europe, together.
The bank has already crossed into virgin territory in response to the crisis, buying billions of euros worth of government bonds to try to stabilize markets. But those actions have in turn unleashed new tensions at the heart of the ECB as its largest member, Germany, recoils from what it sees as a violation of the most deeply held principles of central banking.
The ECB's challenge is to craft one policy that will work in 16 member countries from Finland to Portugal, which have very different economic conditions -- and views about inflation and employment.
....
www.washingtonpost.com/wp-dyn/content/article/2010/06/23/AR2010062302166.html?hpid=topnews
FRANKFURT -- For an entire generation of European leaders, the euro coins jangling in their pockets are more than just a currency. They are a powerful driver of political unity on a continent where people speak more than two dozen languages and spent much of the 20th century fighting each other.
Now, as the euro faces a challenge like none before, the question is whether the currency will last.
The debt crisis that began in Greece and menaces half a dozen other European nations has caused the euro to lose 15 percent of its value relative to the dollar since January. Some economists consider it obvious that the currency union will not survive in its current form, that one or more southern European nations will end up reverting to liras, pesetas and drachmas.
That leaves the future of European unity to be decided not merely by politicians in Paris, Berlin and other capitals, but in a glass skyscraper in this banking hub, by a French banker named Jean-Claude Trichet and his 1,600 employees. Less than a decade after cash machines across the continent started spitting out the same currency -- and less than a month after it laid the cornerstone for a new permanent headquarters -- the European Central Bank is facing extraordinary pressure to keep the euro, and Europe, together.
The bank has already crossed into virgin territory in response to the crisis, buying billions of euros worth of government bonds to try to stabilize markets. But those actions have in turn unleashed new tensions at the heart of the ECB as its largest member, Germany, recoils from what it sees as a violation of the most deeply held principles of central banking.
The ECB's challenge is to craft one policy that will work in 16 member countries from Finland to Portugal, which have very different economic conditions -- and views about inflation and employment.
....
www.washingtonpost.com/wp-dyn/content/article/2010/06/23/AR2010062302166.html?hpid=topnews