In the GEAB no 109 of November 2016 we wondered if “the euro would survive beyond the year 2017”. Five months later, we wish to deepen and complete our analysis. One reason for the weakness of the euro comes from the political anaemia of the euro zone, which is ultimately far too un-integrated to afford a single currency, or (the other side of the coin, if we may say it this way) afford misconceptions around this single currency for a heterogeneous zone.
The well known thesis driving us on this topic is the anchoring of the governance of the single currency in a common democracy which would immediately set in motion all the principles of solidarity, of economic convergence and upgrading, which would be required in order to make the eurozone a powerful and coherent economic player on a global scale.
But we see this road moving farther and farther away. The projects of a Parliament of the eurozone drafted by some (Schäuble, Macron and Hamon) are dramatically lacking imagination, merely wanting to bring together national and European parliamentarians (all elected on a national basis) from the eurozone into a new “democratic” entity; the latter actually has no chance of bringing Eurolanders together around the governance of their common currency.
The tendencies lean heavily to the massive return of European governance in the hands of the national level (project of the right-wing radicals in particular, but also of the centre wing with its multi-speed Europe project draft, exclusively based on the political strength of the re-legitimised member states, thus always eliminating the euro-citizens from the game … on the pretext that they are too anti-European. When we look at the solutions of all these policies, we can wonder who is truly the most anti-European).
This expression "chaotic recomposition" seems best to summarise the phase where we currently are with regards to the development of the crisis, a step indicated here as extending over four [...]
The financial crisis followed by the debt crisis has led to a substantial change in the mandate of the European Central Bank (ECB) and to more political provisions. The ECB [...]
Euro-diversification As part of our forecasts mentioned above on the probable reform of the common currency, we recommend people to "diversify their euros" simply by placing part of any liquid [...]