, 6 tweets, 2 min read Read on Twitter
For almost two years now, I've been randomly but constantly been drawn into discussions about the benefits of the euro.

The simple fact is that at the macro level, there are basically none. In the firm-level, especially in the SME -level, there are few. But, 1/
The question is, which should weigh more? The larger single-currency financial markets or a floating exchange rate that corresponds to the macroeconomic and political conditions of each country.

I think that answer, undeniably, is that the latter is more important. 2/
This is because global financial markets are very open and developed nowadays. Funding and hedging is widely available.

However, cutting wages and prices in a #recession has proven very difficult as it has been since the end of the 'liberal era' in early 1900's. 3/
There's no going back to completely flexible wages of the gold standard.

Moreover, example of some 200 currency union shows that it can be upheld only through fiscal transfers. Because #Eurozone is not a country, there's no political will for that. 4/
Because fixing the #Eurozone would mean imposing a supra-national control over sovereign states, it's best just to let it unravel.

If euro had an exit-mechanism, it could help. But, because of the #ECB s asset purchase program and bailouts, it has become cumbersome. 5/5
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