Monday, 22 November 2010

Fire fighting

Q. Did the Euro lead to Ireland's economic mess?
A. NO it made it worse that it might have been

Q Did the Euro help Ireland identify the problem and help in its resolution?
A. NO, it masked the problem and gave them political cover to take more risks in trying to resolve its problems, making the situation worse.

Q, what leads me to these conclusions
A. Iceland

Iceland is an even smaller nation than Eire, it could not save its banks, it had to ask for assistance and face up to its problems sooner.

Seems to me the worlds banking problems are characterised by interdependence and shared risk, if this is the issue we are trying to solve, then why repeat the same mistake with nations?

What we are looking for is firewalls, that stop, slow down or alert us to any problems, the ultimate firewall is national sovereignty.

A truly sovereign nation will have to take responsibility for its actions sooner, such a nation will turn the cooker off before the fire-fighters arrive in order to assist them in saving the home. The Irish elite kept on cooking and gambling that something would turn up, with the gas full on, and the EU and EMU made that possible.

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