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Source link: http://archive.mises.org/20214/mueller-how-the-euro-crisis-will-end/

Mueller: How the Euro Crisis will End

January 2, 2012 by

What’s Behind the Euro Crisis and How Will It End?

by Antony P. Mueller12/30/2011

The true nature of the current crisis is not that of a currency, be it the euro or the dollar, but a financial system based on fractional reserve banking, which, in combination with the modern warfare-welfare state drives towards an…

Philipp Bagus’s Tragedy of the Euro

hat tip: WB

{ 7 comments }

jasontgordon January 2, 2012 at 5:32 pm

The Euromess in one graph

This is, pretty much, the Euromess in one graph. Before the euro zone, countries like Greece and Germany borrowed money at wildly different rates. After they joined together in the euro zone, they all borrow at the same rates — German rates — which meant the market thought their debt was essentially riskless. . .

http://www.washingtonpost.com/business/economy/2011-in-11-graphs/2011/12/22/gIQA0HWJMP_gallery.html#photo=8

Dick Fox January 3, 2012 at 1:22 pm

Why do Greece and Germany have to borrow at the same rate? Do California and Florida borrow at the same rate?

The Anti-Gnostic January 4, 2012 at 5:52 pm

For that matter, why is the US with debt at 102% of GDP paying just 2% interest?

This is an interesting chart with 2010 figures: http://en.wikipedia.org/wiki/List_of_sovereign_states_by_public_debt

One thing that struck me: the Monster of Libya, Moammar Gaddaffi, burdened his people with a stunning 3.3% of GDP debt.

Canadians, who never tire of telling you how well-run their country is, have 84%/GDP. I bet they start hitting the really steep part of that curve in the next five years.

prettyskin January 3, 2012 at 4:44 pm

The title of this piece implies that the writer have looked into his crystal ball to know how it will end. Weather forecasting is still a valuable job, I guess.

Sione January 4, 2012 at 4:51 pm

prettyskin

“The title of this piece implies that the writer have looked into his crystal ball to know how it will end”

You are quite the bullshitter when it suits!

The title implies nothing of the sort. The title implies that there is an end point to the present arrangement (which all available evidence and present experiences validates). The author, obviously, seeks to inform what are the issues that conspire to end present arrangements and where they are likely to lead.

Perhaps you hadn’t noticed by there is a huge crisis underway and such things are not sustainable indefinately. They lead to results and those results are the forseeable consequences of specific ideas, decisions and actions.

Sione

bill wald January 5, 2012 at 4:03 pm

Don’t worry. WW3 will solve the economic problem. We will be driven back to barter and evil will triumph . . . unless Jesus returns and bails us out.

Dave January 14, 2012 at 7:23 am

I think the Euro will fall more in near future.
The S&P downgrade yesterday for several European countries is just the beginning

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