Brussels has been dead wrong. This stupid idea that the Euro will bring stability and peace as it was sold from the outset, has migrated to European domination as if this were a game of Thrones. Those in power have misread history almost at every possible level. The assumption that the DMark’s strength was a good thing and this would be transferred to the Euro, has failed because they failed to comprehend the backdrop to the DMark.
Germany moved opposite of the USA and moved toward extreme austerity and conservative economics because of its experience with hyperinflation. The USA moved toward stimulation because of the austerity policies which created the Great Depression and led to such a shortage of money many cities had to issue their own currency just to function. The federal government thought, like Brussels today, that they had to sure up the confidence in the bond market and that called for raising taxes and cutting spending at the expense of the people. The same thinking process has played out numerous times throughout history. Our problem is, nobody ever asks – Hey, did someone try this before? Did it work? This is why history repeats – we do ZERO research when it comes to economics. It is all hype and self-interest.
Greece should immediately begin to print drachma. By no means has the introduction of a new currency been a walk in the park. There is always a learning curve as in the case of East Germany’s adoption of the Deutsche mark, the Czech-Slovak divorce of 1993, and the creation of the euro itself . However, the bulk of transactions today are electronic. That means we are dealing with an accounting issue more than anything.