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Published in:
2014 | OriginalPaper | Chapter
21. Fundamental Problems of the Eurozone
Author : Efthymios G. Tsionas
Published in: The Euro and International Financial Stability
Publisher: Springer International Publishing
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Abstract
We maintain that it cannot but be the case that there is low inflation in the EMU; actual inflation is hidden below the statistics and the sizeable movements in relative prices which as a result of the credit and monetary expansions, set in motion sizeable reallocations of investment as well as new investment which is, in fact, malinvestent. The flight from euro is documented in the recent increases of gold’s prices, so we hardly need any evidence in addition to that. But the flight from euro can result only as the result of depreciation relative to the US dollar and the associated inflation in the eurozone.