Sashandre, Wikipedia
With all the things going on in Europe, there are now rumors or predictions being made that imply Germany may or should leave the European Monetary Union.
Morgan Stanley has warned that the Greek debt crisis is setting off a chain of events that may prompt German withdrawal from the eurozone, with grim implications for investors caught off-guard… The US bank said a bail-out for Greece may be necessary to avoid a crisis for Europe’s financial system, but warned that it also “sows the seeds for potentially even bigger problems further down the road”.
Mr Fels said weak states cannot easily leave EMU because they would pay a stiff penalty in higher rates, would be stuck with euro debt contracts, and might need controls to stem capital flight. It is a different calculus for Germany, which would see lower rates and might view EMU exit as the only way to ensure monetary stability.
– Ambrose Evans-Pritchard, Telegraph
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There’s a fair chance of this happening. Germany by virtue of its strong manufacturing base is likely to be bailing out everyone else. If Germany leaves then France must surely follow and this will spell the end of Euroland.
Her entrance into the EU was spurred in part by her guilt trip about World War II. It was a huge mistake to sacrifice the old Mark on the alter of political correctness. I believe they should waste no time designing their new currency for a new Deutsche Mark 2012. Now that she has finally paid off the horrid and unjust 95 year-old Versailles Treaty extortion, she should feel that enough is enough. Half joking, I’d say if the EU doesn’t let German go peacefully, she should fight her way out!
This is misleading. There is a huge difference between leaving the EU and living the Eurozone, they are two completely different things. Germany are a member of both the EU (27 states) and the Eurozone (17 states).
Morgan Stanley have suggested that Germany may leave the EMU, but there are members of the EU which are not committed to the EMU by treaty, including the UK and Denmark. It is possible to be in the EU but not in the EMU. The single currency is the third stage of the EMU, the thing that the UK are not signed up to.
As a result your title is very misleading, and should read “Will Germany Leave The EMU?”. It can leave the EMU but remain a member state of the EU. The collapse of the euro would probably see the collapse of the EU (a good thing in my book), but that is a different story.
I stand corrected! Thanks for catching that Ryan.