Thursday, November 15, 2012

Germany and the Eurozone

The New York Times recently started a discussion about whether or not Germany should stay in the Eurozone. This discussion prompted questions of whether or not it was beneficial to Germany's growing economy to stay in the Eurozone.
    Charles Dumas, chairman of Lombard Street Research, said that by staying in the Eurozone Germany was weakening its economy and undervaluing its labor. In contrast Astrides N. Hatzis, an associate professor of law and economics at the University of Athens, pointed out the costs of Germany leaving the Eurozone, such as having the devalued euro provide competition for an overvalued deutsche mark. He also points out that Germany will lose financial and political investments if they leave. Finally, Stephan Homburg, a professor at Leibniz University, thinks Germany should leave because the legal framework of Europe's common currency has been corrupted, it is costly to stick with the euro, and staying with common currency will poison Europe's political atmosphere even more. 
   I found it really interesting to look at the different views on this subject as well as where the people writing were from. It seems to me like place of origin has a large influence on whether or not one thinks Germany should stay in the Eurozone. 
http://www.nytimes.com/roomfordebate/2012/11/12/should-germany-leave-the-euro-zone/germany-should-leave-the-euro-zone

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