Euro mystery

[RayS]

If -as we are constantly told - the euro is in deep trouble and unstable etc. etc. - why is the euro to GBP exchange rate stubbornly remaining around 85p /1 euro ?
What exactly is supposed to happen if it goes ' over the brink'.

Short clear answers please, I'm much too confused already.

 

[ValA.]

I think because that's where bankers and politicians want it to be!
What will happen if it goes over the brink - well I guess we might go over along with it!
I'm not an economist, just a cynic!

 

[JohnGriffiths]

Because our economy is just as bad. In fact our debt as a % of GDP is worse than most. Plus the fact that most of our business is with the EU so if they go into a massive recession, so do we. At least Italy, Greece etc have someone to go begging to, i.e. Germany. DO you mean what happens if the Euro goes "Over the brink"? That means countries like Greece will be unable to borrow any more, they will revert to drachmas which will be pretty well worthless outside of Greece and they will write off their debt to others (like our banks). Other Euro countries exposed to the debt such as Spain may then be unable to pay off their own debt so the whole pack of cards comes tumbling down, us included. Lets hope it doesn't happen.

 

[Merlin53]

I'm not an economist or a politician, but the reason our pound has lost so much value against the € is that the Bank of England decided to release a load of money into the market place via the banks!
This was called 'Quantity of Easing', (another con trick to confuse the masses). In my younger days, it was simple called devalueation!
The general public have no control of any of the monetary actions that are carried out by our varies governments - oops there I go again !
Can anybody tell me who has got the 'trillions and billions' of €'s or £'s that are owed to who?

 

[JohnGriffiths]

I'm not an economist or a politician, but the reason our pound has lost so much value against the € is that the Bank of England decided to release a load of money into the market place via the banks!
This was called 'Quantity of Easing', (another con trick to confuse the masses). In my younger days, it was simple called devalueation!
The general public have no control of any of the monetary actions that are carried out by our varies governments - oops there I go again !
Can anybody tell me who has got the 'trillions and billions' of €'s or £'s that are owed to who?

As far as I know both Euroland and the USA have also using quantitative easing, i.e. printing more money in an effort to pretend we ain't broke.
It's a good job the general public have no control over our monetary policy, most economists don't fully understand global economics and cannot predict what will happen, so how could the general public. They would just go for lower taxes and increased wages or benefits every time with no long term view. And as far as who has had it, the answer is US, the general public. You can see it all around in the cars and houses on the street, toasters in the home, duck houses in the MPs back yards. And we owe it by and large to banks who owe it to the Chinese and Arab oil states who have REAL money backed up by REAL work and goods that we want to own.
The real power in this world is moving very quickly from the West to the East.

 

[KeithJ]

I read somewhere the other day that the simple answer to why the Euro is holding up is because Germany is in it! Apparently there are still investers wanting to put their money in Euros to invest in Germany! If Germany was to pull out, the Deutch Mark would go up in value, making German exports much more expensive to the rest of us. If Greece was to pull out, the Drachmer would go down in value, making Greek holidays etc. much cheaper (like they used to be).
Well that's what I read!

 

[FionaandJohn]

I am a financial adviser and attended a presentation by Invesco Perpetual last week. The topic was sovereign debt and the speaker gave figures for the UK and the USA in terms of household expenditure as follows

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