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Technical recession. Recession nonetheless. The ECB has a real problem with asymmetry. Can't cut rates just for Germany. At the same time there's high inflation in Austria, Slovenia and the Baltics.
A recession helps controlling inflation...
Earlier quoted context omitted.
>The ECB has a real problem with asymmetry. Can't cut rates just for Germany. It's as if a single currency and a single central bank for 25 different economies with different levels of debt, doesn't really work that well in every situation. > At the same time there's high inflation in Austria Inflation in Austria is now mostly due to greedflation. If you cross the border into Germany the same goods are suddenly cheap…
Doesn't the US do the same with states instead of countries?
This has limitations and reduces how analogous it can be to the US' and its member states.
Technical recession. Recession nonetheless. The ECB has a real problem with asymmetry. Can't cut rates just for Germany. At the same time there's high inflation in Austria, Slovenia and the Baltics.
>The ECB has a real problem with asymmetry. Can't cut rates just for Germany. It's as if a single currency and a single central bank for 25 different economies with different levels of debt, doesn't really work that well in every situation. > At the same time there's high inflation in Austria Inflation in Austria is now mostly due to greedflation. If you cross the border into Germany the same goods are suddenly cheap…
Economists in the EU must have understood this and if I had to guess they assumed a fiscal union would develop at some point?
Technical recession. Recession nonetheless. The ECB has a real problem with asymmetry. Can't cut rates just for Germany. At the same time there's high inflation in Austria, Slovenia and the Baltics.
IMHO, it was already there, but it was in denial. Since covid, rents increases have far outpaced salary increases. And since 2022 so have bill, groceries, everything. But then again so is most of Europe.
Same story in the US.
Earlier quoted context omitted.
>The ECB has a real problem with asymmetry. Can't cut rates just for Germany. It's as if a single currency and a single central bank for 25 different economies with different levels of debt, doesn't really work that well in every situation. > At the same time there's high inflation in Austria Inflation in Austria is now mostly due to greedflation. If you cross the border into Germany the same goods are suddenly cheap…
True, but every system has flaws. For the most part the Euro and ECB has been a benefit for every country in it. Even a country like Greece. As bad as the single currency was for Greece, outside the EU and Eurozone, Greece could very likely have been closer to Venezuela with even fewer resource wealth to benefit from.
That's why we have this massive inflation. No real value is created, yet everybody is flush with the money. Pandemic was just a perfect excuse for BS that is brewing since at least 08 crisis.
Earlier quoted context omitted.
Doesn't the US do the same with states instead of countries?
To what extent does each state run its own economy? The EU does not have centralised taxes or a centralised economic policy, but it does have a single currency. It's possible a single currency also requires more centralised financial/economic policies.
The construction economy is really going dow from mid 2023, everyone has trouble finding projects while the money are kept by the people in banks and not released out of the uncertainty.
However, German economy is so diverse that it will absorb this as well.
Technical recession. Recession nonetheless. The ECB has a real problem with asymmetry. Can't cut rates just for Germany. At the same time there's high inflation in Austria, Slovenia and the Baltics.
They wouldn't cut rates anyway, with inflation at 7.2%.
Earlier quoted context omitted.
>The ECB has a real problem with asymmetry. Can't cut rates just for Germany. It's as if a single currency and a single central bank for 25 different economies with different levels of debt, doesn't really work that well in every situation. > At the same time there's high inflation in Austria Inflation in Austria is now mostly due to greedflation. If you cross the border into Germany the same goods are suddenly cheap…
True, but every system has flaws. For the most part the Euro and ECB has been a benefit for every country in it. Even a country like Greece. As bad as the single currency was for Greece, outside the EU and Eurozone, Greece could very likely have been closer to Venezuela with even fewer resource wealth to benefit from.
Except Italy alas.