July 12, 2005

Ditching euro 'could benefit Italy' HSBC

From EU-Serf Telegraph is running an article on HSBC's analysis of the Euro, in short they are in deep:
"In a new paper entitled 'European meltdown?', the world's second biggest bank said Italy, Germany, and Holland had all been damaged by the perverse effect of the one-size-fits-all interest rate policy, and might be tempted to leave.

It said the euro had pushed Germany to the brink of deflationary spiral, while causing a 'dramatic boom and bust' in Holland. At the same time, Italy was now trapped in slump with a 'truly appalling export performance' and exorbitant unit labour costs."
Before the introduction of the Euro all the Pro-EU people said that we had to join, that if we didn't our economy would be destroyed and we would be left behind as teh Eurozone roared ahead of us. Well it hasn't happened, what actually happened was exactly as the Eurosceptics said, a one-size-fits-all interest rate does not work and this will mess up teh economies of the countries that enter.


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