Re: Re: Demise of the Euro closer? – Ignore this if it bores you



@peterhun wrote:

No matter what the Germans will bail out the Euro countries. The taxpayers will have it but they have no choice, the Euro will survive.

Whilst I lean towards agreement with that view, there have been signs in Germany that the electorate are restless and reluctant to keep signing blank cheques for the spend thrift southern EU states.

Over the last 10/15 years Germany has pushed through successful economic and social reforms to help the country cope with swallowing the east. These reforms among other matters meant the sacrifice of some labour protection laws, restricted income, later retirement and higher taxation.

Unfortunately the UK should have done the same but Britain was stuck with a dreadful spend thrift Labour government with their heads stuck in the sand.

Who could blame the Germans then for resentment when they see bankrupt countries like Greece and Portugal trying to continue with huge and expensive social privileges. The people going on general strike almost every week trying to prevent the reform their countries need to survive.

German has a federal political system and not all states are in agreement with Merkles policies. If bailing out Europe becomes a principle election issue things could easily change rapidly.

It will also change if the current slowdown in China hits a hard landing as some economists predict. Demand from China has driven Germany’s recent industrial renaissance. If that declines so will the value of the Euro.