I started this blog in June 2007 asking these questions: Are we in a massive asset bubble that will blow up in our faces ??? - ANSWERED YES ! Is western and particularly British society on the verge of social collapse??? What are the best common sense long term investment strategies to keep you rich? When will consumption/debt bubble economics end and a real savings/production economy begin ???

Wednesday, 4 March 2009

Milton Friedman was right to predict that the euro might not survive a recession

When Ferenc Gyurcsany, the Hungarian prime minister, asked them for a €190 billion handout last weekend to prevent a new economic Iron Curtain from going up across the continent, Angela Merkel told him to get lost. She has the German people and, more to the point, German business behind her: why should they pay for the unregenerate behaviour of others? Why should they worry about the collapse of the zloty and the forint? Why should it bother them that Latvia's debt now has junk rating, or that the Irish are almost broke? If Mrs Merkel wants to stay in power, and German workers wish to keep the fruits of their own labours, they must harden their hearts.

As for the rest of Europe, it must choose either to devalue and end the pretence of economic strength, or persist and risk the breakdown of individual governments. Either way, it is never glad confident morning again for the EU and its bastard currency. Milton was right.


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