French-British Debt Squabble Points Out Euro’s Flaw

in Market Commentary by

[dropcap]B[/dropcap]ickering between France and Britain over debt levels accomplishes nothing. The fact that borrowing is more costly for France, despite Britain’s larger debt-to-GDP ratio, highlights the inherent problems of a single currency in Europe. The economies of Eurozone nations, as well as fiscal policies, are all different. But with the establishment of the Euro, these countries are unable to react to changing economic conditions individually. It is this lack of flexibility that makes French debt riskier. Britain can simply print more Pounds.

The French Don’t Get It

Read more at Project Syndicate.

The following two tabs change content below.
Daily Capital
We at Personal Capital have one goal in mind: to build a better money management experience for consumers. That’s why we’re blending cutting edge technology with objective financial advice. We believe this is the best way to empower individuals and their money. Subscribe to our blog and join our empowered financial community.

Leave a Reply

Your email address will not be published.

Disclaimer. This communication and all data are for informational purposes only and do not constitute a recommendation to buy or sell securities. You should not rely on this information as the primary basis of your investment, financial, or tax planning decisions. You should consult your legal or tax professional regarding your specific situation. Third party data is obtained from sources believed to be reliable. However, PCAC cannot guarantee that data's currency, accuracy, timeliness, completeness or fitness for any particular purpose. Certain sections of this commentary may contain forward-looking statements that are based on our reasonable expectations, estimate, projections and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Past performance is not a guarantee of future return, nor is it necessarily indicative of future performance. Keep in mind investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money.