Friday, September 14, 2012

Eurozone: Is France Heading “South”?


A thorough analysis of the Eurozone history and of past and current French policy problems is available in Seeking Alpha, here.

Excerpt:

“The Bundesbank strategy, pushing the whole burden of adjustment on the deficit countries in the eurozone periphery, by means of savage austerity hasn't been successful and it's running against the limits of internal politics in many of these countries.
The 'time was ripe' so to say, to try something else. However, France might become more like a peripheral eurozone country through more than just political realignment. The danger is that France will experience the same kind of economic problems as well.”

The recent strength of the euro and of the stock markets in the zone could then amount to a short-run Pyrrhic victory.

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