Thursday, 15 December 2011

Euro sovereign

@HECParis has tweeted a manifesto by Jean Monnet chairs Stabilizing the Euro Area and the EU, posted on Facebook. Even if the article was posted 30 November 2011, many of the basics concerning the common currency are presented in a clear manner.

One fraught European summit and about two weeks of increasing turbulence later I want to turn to one aspect relating to my discussion about the need for a euro sovereign (latest post here), since some have doubted the relevance of the issue, while others have evaded this fundamental discussion.

If the debt levels and deficits of the basket cases USA, the UK and in the eurozone are more or less comparable, why do the markets shun the euro area?

The main difference seems to be the lack of a European sovereign for the common currency.

Are there better explanations?

Ralf Grahn