Angela Merkel warned that Germany could abandon the euro

guardian.co.uk/world/2010/de … andon-euro

How Germany could come to kill the euro → ft.com/cms/s/0/85b62490-f66e … ab49a.html

You just know they have the plates for a new DM ready to roll as a contingency.

I bet it is a bluff… their problem is the DM2 would be so strong nobody would be able to afford their cars!
DE gets as much out of the Euro as anyone!
The rest of Europe gets (until now) slightly cheaper credit, but they get a weakened currency to sell in.

Indeed Der Spiegel says as much spiegel.de/international/eur … 98,00.html

I note that the euro rose 2 cents today.

Everyone is trying to trash their currency without actually being seen to trash it…

Of course, a determined country could split economist.com/blogs/freeexch … /euro_zone
(Courtesy FTAlphaville).

+1. And without doing enough harm to actually kill it.

:smiley: Yeah, my original wording was “without actually trashing it!”

It’s a bit mad really.

It could go on for years, or at least for as long as international trade is seen as being worth competing for. Then war to renegotiate the debts and grab resources. Yum… hot port…

Does the collapse of the Euro not seem like an inevitability tho? Eurozone countries dropping like flies (or like flying PIIGS?). I’m with whoever it was who said ‘The Model for the Euro economy is fundamentally flawed.’ In fairness we didn’t notice that until fairly recently and I’m feeling a bit less smart than I would like because I genuinely didn’t see the crash coming. I think as a total amateur closet economist, educated solely by RTE’s Primetime, that the Eurozone is never going to regain its credibility and no-one will have much faith in it again, which may not inspire investment or a new generation of Bond Holders… Unless of course Angela Merkel utters some throw-away comment/‘prophecy’ like the way she catalysed the recent Irish furore maybe… Actually I give up

Good spiegel article… but then you’d expect nothing less from der spiegel.

There does indeed seem to be a HUGE effort to destabilize the Euro and to decide who you’d do well to consider who wins from a weak Euro. That is undoubtedly the US. If the US were to lose their ability to “borrow” in USD they would face real problems. If they for example had to borrow and importantly repay those borrowings in Euro or shock horror Renminbi then they’d be in real trouble. This is as much a treat to the US -more in truth- as any Islamic fundamentalists. So you have to wonder would or could they simple stand by and watch it happen. It is tin foil hat conspiracy stuff but I find it completely implausible that they would see its position as the worlds reserve currency of choice threatened.

Now, it is far to say they would have had little to do - certainly in our case. “We” hired too many Public Servants and elected to pay them too much. “We” decided to pay crazy prices for houses. “We” decided to not make changes to how we manage our economy one we enter the single currency. “We” decided to guarantee our banks. I say “We” but I mean Ireland the state rather than we the citizens. So it might be we simple played into needs of the US. But if we didn’t would they simple allow the Euro supersede the USD? I noted that Sadam H opted to sell oil in Euro instead of Dollars… a bad precedent! Not any more!

So basically my point is, that if someone is trying to undermine the Euro then as in all things follow the money and look to who gains by a weakened Euro?

That’s simple…Who wins - German and French exporters. The only bright spot it either economy in the last decade and only hope for any growth in the future.

Who loses…US, UK, Japanese exporters. FX movements in the current situation might effect UK, Euro and Japanese bonds but if you are the reserve currency then no problem. Especially if your main debt holders all need to hold currency pegs against the reserve currency.

Eh, you forgot the Irish exporters… for all I bang on about 40% of our goods going to the eurozone, the other 60% do not… (leaving aside bogusness for the moment…).

Nearly 60% of Germans want their Deutschmark back instead of ailing euro
The latest poll for the ARD TV broadcaster also showed that 66 percent of Germans fear that the current financial crisis will torpedo their savings. While 57 percent want the D-mark back, only 32 percent said they found anything positive about the common currency. The last euro survey earlier in the year - before Greece and Ireland meltdowns - showed 51 percent wanting the mark back. And seventy five percent believe that it is the financial markets and not the politicians who will decide the eventual fate of the troubled euro.