Are Bailouts, and the European Parliament Going to Solve the Euro Crisis and Save the Euro?

In Europe, borrowing costs for Italy and Spain surged drastically, as traders rush to rid themselves of risky investments. Crisis talks between Italy and the EU are already underway, as its bond yields reached their highest level since the Euro was adopted. Are bailouts, cutbacks and the European Parliament going to solve the Euro Crisis and save the Euro?

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[trevorcharlesmorgan]

With regards the point you made about returning to the Gold Standard, I don’t think that it’s going to happen at any point soon, people have forgotten why there ever was a Gold Standard so no one is making the link between leaving it and the current crisis.

[trevorcharlesmorgan]

Now that this debt bubble is bursting we have to take a cut in standard of living and this pushes our current politics beyond its limits as it simply isn’t what the electorate wants to hear. The popular support is therefore with those who have little understanding of the underlying problem.

[trevorcharlesmorgan]

All the issues you raise I believe to be intertwined. At the heart of it all I believe leaving a gold backed currency is where our current woes began.

Our standards of livings have therefore risen to a point where our abilities to pay for the lifestyles we now expect is not achievable without debt in the form of trade and governmental deficits

[trevorcharlesmorgan]

If we had to honour our obligations in Gold the huge trade imbalances that have developed over the last forty years wouldn’t have been able to have been sustained. If we spent all our gold importing stuff we simply wouldn’t be able to by foreign products until we earned back the foreign gold, this means we would have been forced to stay competitive in the international market place and keep our books in balance.

[Sliepnir2006]

I would like to know just how they are going to return to a gold standard now, I doubt that it would pretty well finish off the currencies of most of the world.

A move back to an investment to small businesses, manufacturing and sensible financial planning could theoretically work.

However, another problem arises and that is how to make the economy competitive, the cost of manufacturing is far too high in the West, which effectively drives manufacturing to countries with lower living costs.

[trevorcharlesaustin]

Interesting and thought provoking, even if I say so myself!