Why Doesn’t Europe Just Print More Money?

By Faye J. Vasiliadis
Lately, we, Greeks, have been wondering about the sanity and the intelligence of our politicians. They keep inventing measures, as often as every week, even though they can see that these measures have absolutely no positive impact on our GDP; not to mention the society at large. We have said a number of times that no one knows the needs of a country better than the people and the politicians that live there. Only those people are in a position to know what’s going on and how to efficiently deal with every problem. IF they are actually aware of what’s going on, this is obviously not our case.

Nevertheless, for the last 2 years, we – Greeks and not only – have doubt the intelligence of the European leaders as well. Procrastination, delays, wrong decisions, lack of appropriate policy, lack of a united voice. Every week there is something different. First it’s a 20% haircut, then, it’s a 50% haircut, followed by the imposition of more taxes, but on the wrong people. First it’s “sell the Acropolis” or “get out of Euro” and now it’s “Greece cannot be expelled from the Eurozone, since this would be disastrous for the European Banking System”. Oh really? You just realized that? How witty of you!
And somewhere along all these European mistakes, the Old Continent makes YET another one. Europe chooses austerity and deterioration of the living standards, as a way to deal with the financial crisis. Well, the way we –economists- see it, when you have excess debt, there are three major tools to deal with it: austerity, devaluation and bankruptcy. At this very moment, the European debt is beyond anyone’s imagination. Just because Germany has a 5% development growth, it doesn’t mean that everything is going well neither that it doesn’t have an enormous debt; quite the contrary. Besides, in order for Germany to have this kind of development, the presence of strong economies that buy its products and services is vitally important. If all the European economies fail, then Germany will have no buyers. This somehow seems to be slipping their minds. So, this austerity that Europe has decided upon is with no doubt the wrong policy to be implemented, because the debt is so high that all the European economies would have to be knocked down in order to make it even a tad smaller. Thus, it’s evident that costs outweigh the benefits.
Currently, we experience a currency war with no precedent, as all our adversaries are trying to devaluate their currencies in order to be more competitive in the international markets, leading to the revaluation of Euro. China has linked Yuan to the American Dollar, which led to the devaluation of the first. The US is printing more money. Japan is systematically selling Yen to the international markets, aiming to drop its exchange rate. And, last but not least, the UK -which also has an unbelievably high debt- has soften its exchange rate policy, by printing more money. Only Europe has decided to vote on austerity, leading to recession, poverty and social unrest.
If Euro would be devaluated, we would have 4 immediate effects:
1) Competitiveness boost
2) Increase of exports
3) Decrease of debt
4) Increase of inflation
If Euro is devaluated, then its products will be more easily exportable to the US and the international markets. The decrease of debt would make the bankruptcy option seem very distant, which would then lead to the empowerment of the European Banking System. Inflation is indeed a problem. However, with all these austerity measures, Europe loses its competitiveness, further deepens the debt and creates social unrest with unimaginable repercussions. So the question is: is there really a dilemma here, between inflation and recession? No. There is no dilemma. Recession will lead many countries to bankruptcy -the first will probably be Greece, but it won’t go down alone! So, undeniably there is only one solution. And this is to PRINT MONEY, even if it does lead to an increase of the inflation.
The international examples are many. Why Europe tosses and turns over this? Is it because Germany and the Scandinavians desire to lead the southern states into an even deeper recession, so they can exploit their natural resources, the land, the businesses and even the sun and then gain total and complete control over the entire continent? Scary, yet plausible, because according to the Classified Report of Horst Reichenbach, it seems that the Germans want Greece to grant its land and sea for 99 years for the amount of 135 billion Euros. And this is not the only report that has been “published”.
You are dreaming about owning Greece, aren’t you? You would love to get your hands on our Oil, Gold, Lignite, Natural Gas and the sun, aren’t you? You want to buy the Acropolis, aren’t you?… Well, guess what. Even if you do buy it, it will NEVER be yours. Never! And should you choose to continue not to print more money; Europe will sink into an even deeper recession. Everyone knows that Germany is just stalling and in a very weird way some people are very happy that the UK stood up to Germany and denied the verification of the new Treaty. We –Greeks- are no longer in a position to make or influence any decisions, since beggars cannot be choosers, but at least we are glad that someone stood up to Merkel and said NO. Sure; the UK will be isolated. But I think it’s better to be isolated than aboard a half-sunken ship. Because make no mistake. The Eurozone at this point is a half-sunken ship. And most of the countries united their voices with Germany’s echo, not because they thought it was right, but because they had no choice. This is how we are saving Europe? By accepting and supporting the 4th Reich? Who in their right mind would want that?