The Uncertainties of Tomorrow

The Uncertainties of Tomorrow

Today's world economy is living a big uncertainty about it's tomorrow.

Looking to everything happaning, a questions is made: will the euro survive?

So, according to what we have seen after the Brexit, it seams that the euro will survive, but, it is still an uncertainty. For how long? It is also an uncertainty. How? For me it is another uncertainty.

The collapse of the euro, threatens the existence of the EU. This is something that make me believe that euro is a political and not an economic decision. Once again.

Lets look arround what is happening with the euro crisis. The Greece case, for example. Greece do not have how to pay its debts, and they came with a debt restructuring as solution, when some actions were pointig for a Grexit (during the negociation some of the greece Ministers set as hypothesis the EU abandon of greece ). Why did not they leave Greece make such choice of leaving the EU and the Euro Zone? The answer for me is simple: Political decision. Note that this is not the first time that Greece enter in default.

Today, with the political scenario that the EU is facing, the euro is really in danger. Many people still do not want to believe in it, beacause they prefer to keep dreaming. The populism movement growing in Italy, France, even in Germany, can create an ambarassing situation for the euro.

In the other side, we have the policies been taken by the US new president, Mr DJ Trump. Before that, the dollar was appreciating and I do not know how much the Euro zone took advantage from it. The proteccionism policy which will lead into a comemercial war with chine, will have impact on the Euro zone countries, especially in those that are less productive.

Back to the EU community issues, if in France the Anti-EU and anti-Euro movement gain the elections, if the same idealogical movement that gained the referendum in Italy goes also ahead against the EU and agaisnt the Euro, we would be talking about a perfect scenario for the euro collapse and a perfect scenario for the EU´s breaking down. Once France and Italy are both pillars of the EU and the Euro Zone. Stiglitz may not agree with me here, but this is what I believe, for the same reasons I somehow believe that the euro maybe a mistake that the Euro Zone is trying to agjust.

“Every Euro Zone country should be wondering about the euro collapse, and should be preparing itself, for it´s (..)exit.”

It will be very painful for all the Euro Zone, EU and world economy, if the euro reachs the collapse. Because the EU institutions now know that it costless to keep it than leave it, I believe that they are doing all the best to prevent the euro collapse.


So, why is one so pessimistic about it?  
Simple!
When they created the euro, the economies of the countries were not prepared to get in a common currency. Now, neither are they prepared to jump out of the common currency.
So the euro´s future is really an uncertainty

Resumo: As incertezas do amanhã (The Uncertainties of Tomorrow)
O colapso do euro é uma questão, que muitos preferem não falar. Mas, este é um senário possível de acontecer.

Existe muita incerteza quanto ao rumo da zona euro por causa da situação política que a União europeia enfrenta, actualmente. Separar a economia e a política é uma tarefa que, eu julgo que, ninguém conseguirá cumprir a risca. Portanto, assim como as incertezas em volta do euro são geradas pela actual situação politicas, eu creio que, por estas mesmas razões politicas o colapso do euro será evitado a todo custo.

Economicamente falando, é simples perceber que será muito mais custoso, para a EU, abandonar o euro, do que mantê-lo.


E a explicação para mim é: as economias de alguns países não estavam preparadas para aderir a moeda única (Euro). E, não estão preparadas para abandonar a moeda única (Euro), agora.  


Príncipe Zanguilo

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Príncipe Zanguilo is a student of economics at University of Minho His interests are Economics, Econometrics, Mathmatics, Languages, Music (Composer, Singer, Beat Maker, Choral Music), and (...)  He will start, from now, publishing in this blog named Aftermath some  opinion reports, about economy and development issues. The reports will be published weekly (every Monday) He will be writing in english, and making an abstract in Portuguese, for every article. He hopes to start making the abstracts also in French and German, as soon as possible. FYI: the first and the second report will be published in Portuguese, with abstracts in english. The only reason is that these reports were written in Portuguese and I avoid a translation to not lose the real sense of the words.    I hope to have your feedback  Príncipe Zanguilo
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