The Euro (Currency)

[splodgeyAl]

when did it all start going t**s up with the world anyway? What actually happened to make it like it is now?

The British and Dutch set up a system whereby their governments could only borrow money from their central bank.

[buck]

i don;t understand any of it to be honest, hense me asking what i am. What does deficit actually mean?

It simply means that if you earn $100 a week, or pounds, or euros, and spend 120, you have a deficit, the larger that deficit becomes, the more you have to borrow to eat or have a roof over your heads. If you don't take steps to stay within your means, you will be thrown out. Almost every European country joined together to form a common currency, except UK and Scandinavia, following the example of the USA. But the USA has a common language, and a common philosophy. How does this affect UK or USA? Both of us do business in Europe exporting and importing goods and services. When the powerful countries like France and Germany have to support the weaker countries they have to impose austerity on them to save the Euro or abandon it, hence less money available for business. It all began in 2008 when banks worldwide were lending mortgage and credit card money way too easily to people not wealthy enough to repay it. The banks began foreclosing on homes in vast numbers, forcing the values down, something that hadn't happened in years.

[LNRV]

It simply means that if you earn $100 a week, or pounds, or euros, and spend 120, you have a deficit, the larger that deficit becomes, the more you have to borrow to eat or have a roof over your heads. If you don't take steps to stay within your means, you will be thrown out. Almost every European country joined together to form a common currency, except UK and Scandinavia, following the example of the USA. But the USA has a common language, and a common philosophy. How does this affect UK or USA? Both of us do business in Europe exporting and importing goods and services. When the powerful countries like France and Germany have to support the weaker countries they have to impose austerity on them to save the Euro or abandon it, hence less money available for business. It all began in 2008 when banks worldwide were lending mortgage and credit card money way too easily to people not wealthy enough to repay it.

 

Thanks for that understand a bit more now

[quisquose]

It simply means that if you earn $100 a week, or pounds, or euros, and spend 120, you have a deficit, the larger that deficit becomes, the more you have to borrow to eat or have a roof over your heads. If you don't take steps to stay within your means, you will be thrown out. Almost every European country joined together to form a common currency, except UK and Scandinavia, following the example of the USA. But the USA has a common language, and a common philosophy. How does this affect UK or USA? Both of us do business in Europe exporting and importing goods and services. When the powerful countries like France and Germany have to support the weaker countries they have to impose austerity on them to save the Euro or abandon it, hence less money available for business. It all began in 2008 when banks worldwide were lending mortgage and credit card money way too easily to people not wealthy enough to repay it.

 

The USA is little different to Europe.

 

http://en.wikipedia.org/wiki/Government_debt

 

If the map showed individual states in the USA like it showed individual states in Europe, then the mixed picture would be very similar indeed.

[L00b]

Can anyone tell me what will happen if and when countries come out of the Euro? Will this make the £ stronger, weaker?

In a nutshell, and sorry for answering the question with another, it will depends on whether all countries come out at once (unlikely), or only a few (more likely), and which countries.

 

If only the basket cases (club meds) come out, then it is likely to strenghten the € (because less and less risk inherent to its 'net worth') and, correspondingly, gain against the £ (which is a good thing).

 

If they all come out, then the question is redundant: the £ would likely stay strong/gain against most national (re-instated) currencies, more so against the 'weaker' ones (drachma, peseta, etc.), less so against the 'stronger' ones (deutschmark, franc). National monetary policies (devaluations galore, expectedly) would soon upset the apple cart anyway.

 

The burning question is not so much whether this-that-the other (or all) EU €-countries would come out, but whether China would let them. They own most of €-Europe these days.

[LNRV]

In a nutshell, and sorry for answering the question with another, it will depends on whether all countries come out at once (unlikely), or only a few (more likely), and which countries.

 

If only the basket cases (club meds) come out, then it is likely to strenghten the € (because less and less risk inherent to its 'net worth') and, correspondingly, gain against the £ (which is a good thing).

 

If they all come out, then the question is redundant: the £ would likely stay strong/gain against most national (re-instated) currencies, more so against the 'weaker' ones (drachma, peseta, etc.), less so against the 'stronger' ones (deutschmark, franc). National monetary policies (devaluations galore, expectedly) would soon upset the apple cart anyway.

 

The burning question is not so much whether this-that-the other (or all) EU €-countries would come out, but whether China would let them. They own most of €-Europe these days.

 

Thanks for the reply but could you please break down into simple english terms that i will understand!

[mossdog]

Gold up over £1000 per ounce once again!.................you can see where a lot of the nervous money is going.

[splodgeyAl]

Gold up over £1000 per ounce once again!.................you can see where a lot of the nervous money is going.

Only to soon be gone

[Jeffrey Shaw]

Can anyone tell me what will happen if and when countries come out of the Euro?

Lots of work for banknote printers! http://www.delarue.com/AboutUs/

[L00b]

Lots of work for banknote printers! http://www.delarue.com/AboutUs/

British banknote printers, so good for us/exports

Stamps printed secretly in Britain were glued on 150 million banknotes, which were trucked around the country with the help of police and the army.

Source (which is also useful -to an extent- for answering the OP's query, as a 'what if' scenario/extrapolation for Greece)

 

Thanks for the reply but could you please break down into simple english terms that i will understand!

In any scenario, the UK/the £ should stay on top