[geetar]

The buzzphrase at the moment seems to be about "saving the Euro", "three weeks to save the Euro", all that jazz. And then today there has been a deal essentially forwarding more German money to the Eurozone crisis project.

I don't pretend to know anything about economics, so I'd be grateful is anyone could give me an answer to the question...why save the Euro? What advantages does the Euro bring? After all, the Union itself existed for a long time before the single currency. So can anyone tell me an answer? Not necessarily one that you believe, but just one that is trotted out as a reason for attempting to save the Euro.

The cynical side of me would suggest that is essentially to do with political vanity, with European bureaucrats wanting to be the architects of a new plan. After all, I don't see how countries like Greece would be in any worse a situation than they are now, if they left.

[LETSJaM]

Leaders ego's are too big to admit defeat.

<3 x

[Giant]

The Euro allows for greater freedom in trade and commerce between countries in the Eurozone. It allows people to trade with other countries without being too put off by massive regulations and tariffs. This is very useful for many businesses and companies, exposing them to a wider audience which allows them to generate more money.

The main fear in regards to Greece leaving is that it will be an unprecedented event, and Eurozone leaders worry that it could result in countries like Portugal, Spain, Ireland etc. to follow suit and simply leave - which would undermine the whole Eurozone and could make everything go back to square one again.

[dongonaeatu]

(Original post by geetar)
The buzzphrase at the moment seems to be about "saving the Euro", "three weeks to save the Euro", all that jazz. And then today there has been a deal essentially forwarding more German money to the Eurozone crisis project.

I don't pretend to know anything about economics, so I'd be grateful is anyone could give me an answer to the question...why save the Euro? What advantages does the Euro bring? After all, the Union itself existed for a long time before the single currency. So can anyone tell me an answer? Not necessarily one that you believe, but just one that is trotted out as a reason for attempting to save the Euro.

The cynical side of me would suggest that is essentially to do with political vanity, with European bureaucrats wanting to be the architects of a new plan. After all, I don't see how countries like Greece would be in any worse a situation than they are now, if they left.

y not

[Sternumator]

They are trying to avoid the financial shock that a break up of the euro would bring. The idea behind the euro is that makes trade easier and cheaper because you don't have to change your money you can just buy stuff in other countries straight away.

[Aphotic Cosmos]

Mostly because a total or partial collapse of the Euro would lead to the destruction of the European Union (and almost certainly the Economic Area), and a global financial apocalypse that far outstrips the Great Depression in scale and impact. There is a debate to be had about the future of Europe and the Euro, but for the moment it must be rescued to avoid the collapse of civilisation as we know it.

[Sir Fox]

(Original post by geetar)
The buzzphrase at the moment seems to be about "saving the Euro", "three weeks to save the Euro", all that jazz. And then today there has been a deal essentially forwarding more German money to the Eurozone crisis project.

And >90% of Germany's population hopes that the Federal Constitutional Court kills that crap. The ESM outrageously undermines the parliament's right to control the budget, it creates an organisation situated in Luxemburg and not subject to any kind of parliamental or judicial control (infact, all its staff is immune to any kind of prosecution), it's a danger to democracy and should be annihilated.

[richiemayne]

Basically the question isn't about whether the Euro will collapse, but whether certain countries will stay in it, i.e. Greece and Spain.

In essence, if these countries left the Euro savings in banks would become much less valuable and so savers would rush to move their money elsewhere or get it in cash before the transition. This would lead to a run on the banks, which would bankrupt the financial system which is, if you like, the central nervous system of the economy. This would paralyse the economy as there would be no means to fund any form of economic activity other than bartering and hard cash which is rather rare nowadays. There would be social chaos and God knows what else.

That is the main concern - political pride comes second no matter what cynics might say.

[Rakas21]

In the short term the reasons for 'saving' the Euro are the economic consequences of its collapse, some would inflate but others such as Greece would enter depression. Whilst many Eurosceptics argue against the Eurozone the consequences to the UK economy of its collapse in the short term would be nothing short of catastrophic.

The reasons for its creation and long term belief in maintaining are mainly political. The smaller countries know that they will never be important on the world stage whilst the larger nations (mainly Germany and France) want power, the two have tied up neatly given that Spain and Italy have been happy to sit back and follow orders until recently.

So like many things further integration is all about power, the ability to match the influence of the USA and China and generally bend things your own way.

[FDR]

(Original post by geetar)
The buzzphrase at the moment seems to be about "saving the Euro", "three weeks to save the Euro", all that jazz. And then today there has been a deal essentially forwarding more German money to the Eurozone crisis project.

I don't pretend to know anything about economics, so I'd be grateful is anyone could give me an answer to the question...why save the Euro? What advantages does the Euro bring? After all, the Union itself existed for a long time before the single currency. So can anyone tell me an answer? Not necessarily one that you believe, but just one that is trotted out as a reason for attempting to save the Euro.

The cynical side of me would suggest that is essentially to do with political vanity, with European bureaucrats wanting to be the architects of a new plan. After all, I don't see how countries like Greece would be in any worse a situation than they are now, if they left.

Here is pretty much the official line as to why a euro breakup would be disastrous:

Firstly, those in southern periphery countries would have their savings held in banks devalued by potentially up to 75% if you live in Greece, probably less if you live in Italy or Spain. These countries will also have a hard time accessing the markets. Then there is the impact on finance; many, including British banks with British deposits would make significant losses, and consequently, people could lose their savings. Credit would dry up hugely worldwide (much more so than in the 'credit crunch' of 2008), meaning the cost of borrowing would soar, and many firms and ordinary folk would be completely unable to access credit markets at all. Business and Consumer confidence would plummet, which would consequently mean large scale job losses - much more so than in any recession ever, most likely great depression era figures.

If the euro broke up, and currencies like the Lira and Drachma returned, trade would fall, as the cost and uncertainties involved would reduce trade, and countries may resort to protectionist measures. There is also the social issue - far left and right parties are gaining popularity across Europe, were such parties like the Nazi New Dawn party in Greece to get into power, then we could be looking at a very scary Greece, and a very fractured, resentful Europe - Immigrants and ethnic minority groups would suffer the most.

[Cannotbelieveit]

EU bureaucrats see it as a significant step to creating a United States of Europe, disbanding the Euro crushes their ultimate dream.

The sooner Europe gives up on the Euro and revert back to their old currencies, the better. The Euro has barely been around for a decade, and it has been a complete, and utter failure.