# Is the euro unpopular?



## ajapale (2 Jun 2005)

Listening to local radio reports last night I was struck by the assertion that the one of the reasons why the Dutch rejected the EU contstitution was because of the "unpopularity of the euro".

Is this true? Is the euro unpopular in Holland? How popular is the euro in Ireland?

Travelling around Europe over the last few years I got the impression that people across the eurozone were broadly happy with the currency.

ajapale


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## Breffni Boy (2 Jun 2005)

Personally I think the Euro is a great thing.  I love being able to go on hols and not worry about exchange rates, banks fleecing me, being ripped off due to unfamilarity with local currency etc. etc.  I also love the lower interest rates that came with joining EMU.  If only the UK would join it would be even handier for going up North.

BB


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## tonka (2 Jun 2005)

Its unpopular in Italy where 1,000,000  has suddenly become a lot of money and not everyone is a millionaire any more


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## Alba Longa (2 Jun 2005)

The Italians illogically blame the euro for all their woes at the moment - and not the government.  I'd like to see what would have happened to Italy if they had kept the lira.  I think they would be much much worse off - and things are very bad here at the moment!


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## tonka (2 Jun 2005)

Italy has been running vast budget deficits for years and is chronically indebted , according to 'the rules' it should never have been let into the Eurozone in the first place .

In 2002 for example ! 

[broken link removed]

Over the Years 

[broken link removed]

and cumulatively, (HINT, We Irish  managed to hit 125%  around 1987-1990 )

[broken link removed]


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## ClubMan (2 Jun 2005)

Funnily enough - wasn't _Ireland _the only (?) country in which nominal prices went up immediately when the € was introduced? For example, something sold for IR£1 became €1.27 while in most or all other € zone countries the nominal price went down?


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## Alba Longa (2 Jun 2005)

As soon as the Euro came in in Italy, the cost of products costing Lire 1,000 commonly began costing Euro 1 (almost doubling).  Food went up terribly, but prices seem to be going down at the moment in most places - only because of the crisis.

Clothing is cheap because most of them are imported (legally or illegally) from China  It is almost impossible to find genuine Italian made clothes in the shops.  I don't think the Italian factories could compete with the prices anyway - so I suppose that will mean more and more unemployed Italians.


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## CoffeeBrew (3 Jun 2005)

Euro seems to be increasing unpopular in Germany. Some 56% of Germans want to go back to the deutschmark. 

http://news.bbc.co.uk/1/hi/business/4599681.stm


The EU big-power countries are rebelling.


"Italy should consider leaving the single currency and reintroducing the lira"
http://reuters.myway.com/article/20050603/2005-06-03T072109Z_01_N03232223_RTRIDST_0_NEWS-ECONOMY-ITALY-EURO-DC.html


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## zardebt (3 Jun 2005)

The euro has also caused a wage inflation in Ireland esp for American companies based in Ireland .....

Could it contribute to Ireland being an expensive place to locate hire ????


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## ClubMan (3 Jun 2005)

CoffeeBrew said:
			
		

> Euro seems to be increasing unpopular in Germany. Some 56% of Germans want to go back to the deutschmark.



From the BBC article...



> According to Stern, some 56% of Germans want to go back to the deutschmark.




I wonder if this poll was conducted scientifically or was it yet another rubbish, populist telepoll or something like that?


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## ClubMan (3 Jun 2005)

zardebt said:
			
		

> The euro has also caused a wage inflation in Ireland esp for American companies based in Ireland .....



How can you attribute wage inflation solely or mainly to the currency in use!? Surely more pertinent factors are supply and demand, inflation/cost of living etc.?


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## zardebt (3 Jun 2005)

What I am saying is that the cost of hiring in Ireland due to the euro esp for American  companies has increased.

what I am concerned about is that it may be a contributing factor for American companies to hire else where hmmmmm 


Zardebt


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## Duplex (3 Jun 2005)

I'm not suprised the Germans are hankering for the DM, they'd have 1% base rates now if they still had control of monetry policy.


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## ClubMan (3 Jun 2005)

Are you sure about that? I thought that rates were only as low as they are now because of the situation in the likes of _Germany _and _France_? Don't forget that the quid pro quo for this would be that if we our _Central Bank _had control of interest rates here then ours would be much higher!


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## zardebt (3 Jun 2005)

ClubMan said:
			
		

> Are you sure about that? I thought that rates were only as low as they are now because of the situation in the likes of _Germany _and _France_? Don't forget that the quid pro quo for this would be that if we our _Central Bank _had control of interest rates here then ours would be much higher!




I think if the ECB was to just monitor France and Germany there would have been a rate cut in the last year .... Due to inflation pressure from countries like Ireland Spain the ECB is force to walk a tight rope and stay neutral ....

and that's why like Duplex says Germans are hankering for the DM, 

they'd would  have a 1% base rates now if they still had control of monetry policy to try and stimulate some growth !!


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## royrogers (7 Jun 2005)

Yes, it is on a free fall 

http://news.bbc.co.uk/1/hi/business/4616241.stm


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## tonka (7 Jun 2005)

€1.30 to the $ was as crazy as €0.80 to the dollar a few years back. 

I would say €1-€1.10 is fair value , it will drop to €1.10 by July if there is a possibility of a rate cut in Europe and if the ECB dont either do it or rule it out completely . 

$ Chief Alan Greenspan observed a trend towards low long term interest ratesin a speech a few days back. 

[broken link removed]

"But he added that there was no fully satisfying explanation for such low long-term rates, which are a worldwide phenomenon and which have been insensitive to signs of strength in the global economy.

Foreign central bank purchases of US Treasuries was part of the explanation, but the overall impact had probably been "modest", and could not explain the drop in long-term rates over the past year around the world, he said."

Must keep overpaying that mortgage


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## royrogers (7 Jun 2005)

The Treaty is DEAD a new one will have to be made?


http://news.bbc.co.uk/1/hi/uk_politics/4614611.stm


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## tonka (7 Jun 2005)

do we have any comments to make ourselves Roy , I have the BBC on my RSS feed already ta very much ?


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## Guest127 (10 Jun 2005)

the brits are laughing. albert reynolds once stated that if someone travelled through all 15 eu countries and started with £100 and without spending any money whatsoever just changed money in each country then by country 15 he would have little or nothing left. So now we have a common currency in the eurozone which personally I think is brilliant but looking at it from the brits point of view, they have control over their own interest rates and they only have to purchase _ONE_ currency to trade or travel in all eurozone countries. Not that much more difficult than ourselves when it comes to it.


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## Betsy Og (16 Jun 2005)

I think the euro has, overall, been good for Ireland.


Pros: 
Low interest rates due to Germany/France, for those building own properties this makes things cheaper - for those buying in competitive market you could argue it has just inflated the original purchase cost and therefore your monthly repayment may not be much below what it would have been under higher interest rates (if we assume less competitive bidding so lower original cost).

Travel convenience - this works outside the EU too as Asia, South America etc. who used to only real deal with the dollar, and maybe sterling, are now getting used to the euro.

Helping competiveness - Euro not particularly strong (US$ has been nearly artificially weak up to lately) so exports reasonably cheap. Look at Britain, who wants to buy from them - sterling is prohibitively strong, even for the casual tourist, let alone the bulk buyer.

Cons:
The traditional 'rip-off' culture again took their opportunity to take the piss. Also the general inflationary trend that was going for a while might have offset or even reversed the currency effect on competitiveness.

Travel cost - while it helps our exports, it does make things a bit dearer if going to strong currency locations like UK. 

Overall:

Given our balance of trade with exports exceeding imports I think the euro has been good for that. Inflation has been a bit of a pain but I dont think you can blame the Euro per se for this - 1 became 1.27, its what the shysters did next that caused the inflation, and low interest rates for home builder like myself makes for unmitigated good news.


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## joe sod (16 Jun 2005)

"Euro not particularly strong (US$ has been nearly artificially weak up to lately) so exports reasonably cheap"

No you are wrong the dollar is now a very weak currency on fundamentals. The euro has actually been artificially strong over the last few years but only because it is not the dollar. Now people are unsure about the stability of the euro. The Fed has been raising interest rates for the last year but the euro rates have stayed at 2% this is the reason for the dollar rally. Many people think that the european interest rates will  drop further however I am convinced this will not happen. For the time being they will remain at 2% but very shortly they will start rising trailing the dollar somewhat, and the Fed will also be forced to keep rising interest rates in order to keep the asians buying dollar assets.


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## joe sod (16 Jun 2005)

"Look at Britain, who wants to buy from them - sterling is prohibitively strong, even for the casual tourist, let alone the bulk buyer."

You are correct with this and sterling is due for a substantial fall. This is the currency that the speculators will target next. It has been unusually strong over the last decade because of the strong british economy. However the british economy is alot weaker than it looks on the surface. Sterling has crucified manufacturing and exports from britain and this is starting to tell on the british economy now that the consumption and housing boom is coming to an end. But a much more significant fact is that North Sea Oil has peaked and is dropping off now. British oil production dropped 10% over the last year just as oil prices began hitting historic highs. 
         if anything the euro will rise again or at the least won't drop any further against the dollar. The german and french economies are alot stronger than they look on the surface. Germany is the second largest exporter in the world hardly a "weak economy. When a conservative government is elected in germany in september it will be the start of big changes and reform in germany. So the next 15 years will be good for France and Germany, but bad for America, Britain and Ireland. Ireland will be particularly hard hit with the nightmare combination of a weak dollar and sterling and a strong euro together with much higher interest rates.


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## tonka (16 Jun 2005)

I am highly scpetical as to whether the € will strengthen, it will drop off to about €1.05-1.15 to the $ by end next year. 

By end next year the new German govt will have proven itself .....or not .


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## joe sod (16 Jun 2005)

"By end next year the new German govt will have proven itself .....or not ."

You don't give them much time. Margaret Thatcher didn't prove herself in one year (by the way Im no fan of hers). It will be the same as the conservatives under margaret thatcher getting re elected after the socialist governments of the seventies in britain.


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## joe sod (24 Jun 2005)

"THE euro will continue to fall against the dollar and the row over the new EU constitution could spark a flight of capital from the currency zone, a senior economist warned yesterday. 

Bank of Ireland economist Dr Dan McLaughlin said the currency has the potential to fall to as low as $1.15 and to stg66p. "

"This could prompt a shift out of euro assets, particularly if the anti-euro sentiment apparent in some countries intensifies," he said. 

Dr McLaughlin concluded that at a minimum the euro's cyclical advance, which took it from $0.823 to $1.366, may well be over, and on a technical basis the fall through $1.238 throws up $1.159 as a possible target."

For some reason Dan McLaughlin seems intent on talking down the euro and talking up the dollar. He seems to be hoping that the current crisis will make the ECB reduce interest rates. Of course a stronger dollar and a weaker euro would be great for the irish economy. What McLaughlin seems to be playing at is maintaining peoples expectations that the good times for the irish economy will continue, that interest rates will stay low, that the dollar will get stronger etc etc. Of course he may turn out to be a "comical Ali" figure still talking things up when everything is falling down around him.


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## Warren (22 Nov 2005)

Just wanted to resurrect this thread to see what people's opinions are on the future of the Euro. On Todays FM's "Sunday Business Show" this past Sunday Mary Ellen Synon was talking about the fact that that the Euro will only last 4/5 more years and that every Financial Analyst in the City of London knows this. She felt Italy would leave first to be followed by Greece. This is the first time I have heard such an opinion expressed and thought it was pretty unusual. Personally I feel that an end to the Euro would be catastrophic for Ireland - the impact it would have on interest rates here would probably leave half the country bankrupt.


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## ajapale (22 Nov 2005)

Thanks Warren for resurrecting the post.

for the record here is my original post:



> Listening to local radio reports last night I was struck by the assertion that the one of the reasons why the Dutch rejected the EU contstitution was because of the "unpopularity of the euro".
> 
> Is this true? Is the euro unpopular in Holland? How popular is the euro in Ireland?
> 
> Travelling around Europe over the last few years I got the impression that people across the eurozone were broadly happy with the currency.



This anti Euro sentiment seems to be emanating from the the City of London and supported by the English Press.

aj


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## RainyDay (22 Nov 2005)

Mary Ellon Synon is a poisonous troll - she's just stirring it up (again)


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## CCOVICH (22 Nov 2005)

It's just her opinion, the furore over the Italians leaving the euro has died a lot since it was first raised.  I heard the piece on Today FM, and it was pretty much a throwaway remark-nobody challenged her to back up this wildly speculative and sensationlist comment (that Italy would leave the euro, followed by Greece, and then Ireland).


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## Janet (22 Nov 2005)

She was also asked about her belief that the US should not have gotten involved in either of the World Wars and asked if she wasn't at least pleased with who the winners of WWII were made a comment about having been pleased with Hiroshima at any rate.  I have to say I was horrified at the unrepentant way she said it - and by the fact that no one challenged her.  Wouldn't be inclined to have any respect for her views I don't think.


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## CCOVICH (22 Nov 2005)

Yeah, I couldn't believe the Hiroshima and Nagasaki remarks either.


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## ajapale (22 Nov 2005)

I think Mary Ellen Synon should not be dismissed as a troll, after all she has a unique insight into the international finance at the highest level.



> Mary Ellen Synon was nicknamed "the Bonk of England" by tabloid newspapers in 1995 after she disclosed that she and Rupert Pennant-Rea had had sex on the governor's dressing room floor at the Bank.


 see Bonk.


Having said that, the best way to counter her assertions is the aggressively challenge and refute them with evidence.

I still wonder where this anti euro sentiment is being orchestrated and more importantly why? I suspect there are powerfull vested interested who would like to destroy (or damage) our currency.


aj


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## CCOVICH (22 Nov 2005)

ajapale said:
			
		

> Having said that, the best way to counter her assertions is the aggressively challenge and refute them with evidence.


 
Or dismiss it as speculation until she offers evidence to back them up?

I think that the article you linked to gives an example of what kind of person she is.  If someone has such conservative/controversial views on the disabled, can we necessarily have any faith in what she says about the common currency?  The two might not be linked, but I think that they are both indicative of adopting 'extremist' positions.


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## Warren (23 Nov 2005)

Janet said:
			
		

> She was also asked about her belief that the US should not have gotten involved in either of the World Wars and asked if she wasn't at least pleased with who the winners of WWII were made a comment about having been pleased with Hiroshima at any rate. I have to say I was horrified at the unrepentant way she said it - and by the fact that no one challenged her. Wouldn't be inclined to have any respect for her views I don't think.


 
Yes did anyone have any idea what she was on about there. What sort of reasoning could she have for asserting that the U.S. should not have got involved in either WW. Im not certain about WW1 but I dont think there was any way they could have ignored the Japaneese attack on Pearl Harbour


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## dam099 (23 Nov 2005)

Warren said:
			
		

> Yes did anyone have any idea what she was on about there. What sort of reasoning could she have for asserting that the U.S. should not have got involved in either WW. Im not certain about WW1 but I dont think there was any way they could have ignored the Japaneese attack on Pearl Harbour


 
Not agreeing with her viewpoint but it is arguable that the US were already involved in WW2 before Pearl Harbour as they were providing supplies to the British. Not sure if that had much influence on the Japanese who I believe had other reasons for Pearl Harbour.


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## tyoung (23 Nov 2005)

There has always been a strain of isolationism in American Foreign policy particularly among Small Government/Libertarians.  In fact the most virulent opposition to the  war in Iraq comes  from this group  not from Democrats.  Check out LewRockwell.com.


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## Chamar (23 Nov 2005)

I HATE the euro. If for nothing more than I cannot stand having so many bloody coins. 

As a project I don't see it lasting. I mean the current half-in-half-out scenario is a bit barmy. If we had to drop the punt for anything it should have been for sterling. 

One of the biggest arguments for the euro was that it would make the interest-rate setting process independent of member state governments - because it was said governments would always consider their own re-election more important than what was best for the economy at that time. Ergo lets set up the ECB with a bunch of Eurocrats who will decide rates for a "euroland" economy that is totally economically diverse.

Completely mad.


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## daithi (29 Nov 2005)

I for one, would get rid of the 1,2 and 5 cent coins-they're a complete pain ...daithi


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## Glenbhoy (30 Nov 2005)

> I HATE the euro. If for nothing more than I cannot stand having so many bloody coins.


 
What currency were using prior to the euro?  Personally I don't mind the €2 coin, considering it's the only extra coin we now have


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