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Stop selling a pig in a poke

by on 25/04/2012

Stop selling  a pig in a poke

As Mr. Steve Keen

correctly said the problem behind the crisis is, that the G.I.P.S.I. countries national income was for years above the economic value they were able to create, and to bridge this gap they took loans from everyone who was ready to give it to them namely banks from Germany, France and their other partner countries in the European Union. The seeds of the crisis started with the acceptance of the Euro, that in one hand closed the possibility to finance their deficit by printing money, but on the other hand it enabled them to take loans  from private banks, due to their mismanagement that characterized the whole financial system, that preferred the easier way, to give one loan of 10 milliard Euro to an irresponsible government and not 1 million Euros to ten thousand new economic ventures, that could bring real economic growth.

 But now that the party is over, this has to be changed? The problem of European financial system is not only the equity of the banks, but also their failure to create system, that can channel the financial resources into the new ventures of small sized companies. If the banks will not do it, there will be no economy to pay the loans and the interest back. The other big problem is the protectionism in the labor market, let all the employees including the government freely chose to employ whom they want,  and free the labor system from all the obstructions it is tied by. It will let the young people enter the work force and hopefully, with it will come the change for better. They are more educated than the previous generation more dynamic and better equipped with the new technologies. 40% unemployment rate of the youth is devastating in the countries with close to 20% population in pension and not accidently this rate of unemployment is mainly in the G.I.P.S.I. countries. As answer to  all the threats of political disruption, i believe it is only problem of creating  political leadership that looks on the realities beyond the next corner. It is time to say these things straight forward and not wrap it into some monetary talking, that nobody really understands its meaning. Not even Mr. Browne can clearly say, what it means to create in the G.I.P.S.I. countries their national currency. So please stop selling  a pig in a poke.

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