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Wednesday, June 30, 2010

Germans want to ditch the Euro

As a direct result of Germany being forced to bail out Greece, the German people now want out of the Euro. Before the Greek crisis two thirds of the German people supported the European currency. Now only thirty percent support the Euro and fifty-one percent want to abandon the Euro. If this attitude continues in the long term, this could represent a huge shift in Germany’s relationship with the European project.

It may not be easy to leave the Euro and return to the Deutschmark, but I suspect that it will not be impossible. The real question is if the political elite, who are married to the idea of European integration, will be willing or able to respond to this new demand. Will political parties be able to change their message and grab hold of this new anti-Euro sentiment?

Posted by Hugh MacIntyre on June 30, 2010 | Permalink

Comments

It may not be easy to leave the Euro and return to the Deutschmark,
Posted by Hugh MacIntyre on June 30, 2010

This has already in fact happened. Most German businesses will only accept Euro's at face value whose serial number begins with X. All notes that start with X were printed by the German government. Notes that start with Y are printed by the Greek government and almost never are accepted. You have to change them in a bank and pay a premium to get X serial number notes. Serial numbers that start with N (Austria) and P (Holland) usually are accepted. The practice of only accepting X serial number notes has been happening for quite a while.

Posted by: The Stig | 2010-06-30 6:37:16 AM


It will probably take at least a generation for any such shift to take hold in the elite, Hugh. As the baby boomers demonstrate, attempting to reform the currently reigning generation is a waste of time.

Posted by: Shane Matthews | 2010-06-30 8:03:42 AM


The Stig: I can't say I blame them. Considering that the average German works until they are in their mid 60s, there is considerable resentment for paying for Greeks to retire in their 50s as well as bailing out their entire country....

I'd do the same thing.

Posted by: Don from Canada | 2010-07-02 10:55:52 PM


Shane- For someone who despises "baby boomers", you sure sound like one.

"attempting to reform the currently reigning generation is a waste of time." That's the sort of statement that defined my generation. Sort of like "never trust anyone over 30".

Could someone explain why it makes a difference where these bills were printed? How can it be a common currency if businesses are applying an exchange rate?


Posted by: dp | 2010-07-03 9:48:41 AM


Could someone explain why it makes a difference where these bills were printed? How can it be a common currency if businesses are applying an exchange rate?


Posted by: dp | 2010-07-03 9:48:41 AM

If Greece, Portugal, Italy, Ireland, Spain and even England go into a major recession and the currency loses too much value the Germans could islolate all the X notes until they can print enough Deutschmarks to go on their own. A year ago this whole scenario would have seemed unlikely, but now it is a real possibility.
Much like any business that has to much overhead and sagging income, countries can also go broke.
I have been posting for years that when you outsource thousands of factories and fire millions of workers, it eventually has to come back to bite you in the ass. Cheap chinese products are only cheap if you have a job that gives you purchasing power.
Between Wall street greed and Corporate greed we have done to the western economy what BP has done to the Gulf. Germany was only slightly smarter and retained much of their industry. I doubt if they retained enough.
China and India have done very well. The next super powers.

Posted by: peterj | 2010-07-03 10:34:03 AM


If Greece, Portugal, Italy, Ireland, Spain and even England go into a major recession and the currency loses too much value the Germans could islolate all the X notes.................
Posted by: peterj | 2010-07-03 10:34:03 AM

When did England join the Euro?

Posted by: The Stig | 2010-07-03 1:35:40 PM


Posted by: The Stig | 2010-07-03 1:35:40 PM

Knew that would come after I posted. Should have said totally dependant on the EU common market and also in the same boat. Things are far worse in Britain now than when Thatcher took over and Cameron is no Thatcher.

Posted by: peterj | 2010-07-04 7:44:37 AM


Should have said totally dependant on the EU common market and also in the same boat.
Posted by: peterj | 2010-07-04 7:44:37 AM

40% of the UK's exports go to non-EU countries. Exports to Germany are about 12%. If Germany reverted back to the DMark exports to non euro currency countries would be over 50%. I'd hardly characterize that as "totally dependant".

Posted by: The Stig | 2010-07-04 8:03:06 AM



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