Posted by: Nathan M. | January 20, 2009

Euro-The Big Ship

clipped from www.businessweek.com

The Euro’s Growing Appeal


What’s going on here? The global financial crisis has proved the wisdom of former Federal Reserve Chairman Paul Volcker’s oft-cited observation following the Asian financial collapse of 1997, fomented by the implosion of the Thai baht. In the sea of global capital markets, he said, it’s best to be on a big ship when the waters get rough; an ocean liner can better negotiate the swells that would capsize a smaller ship.

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This is a result of the economic collapse that I had not thought of, but is definitely an interesting, and logical reaction. The economic troubles of the world will, in all likelihood, serve as a catalyst to a tighter-knit international world. Many corporations will choose to take the safe route, and, like it or not, corporations have a large influence on what the connections are between different countries. Nation-states will go to great lengths to keep their economies stable, and with a market as large as what the Euro represents, there is a lot of stability offered. Even in instances such as Quebec-I sincerely have my doubts that a referendum for separation would received a lot of support during this time of crisis, since Quebecois are not going to want to jump into a little raft when they are inside of one of the most stable boats in the world during this economic storm. Of course, economic fear can only go so far-ideological thought and patriotic religion often overrules economic and political fears and facts. That being said, I think that we can expect to see a real coming-together of the different states of the world, at least economically.
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