-- Former German Chancellor Helmut Schmidt said talk of the euro’s collapse is wildly exaggerated, and that he sees no particular danger for the single currency. “Contrary to all kinds of silly hogwash written, especially in English-language newspapers, the euro is absolutely not in danger,” Schmidt said in an interview with Germany’s Wirtschaftswoche magazine published today, according to an e-mailed transcript. “It’s the second-most important currency in the world. There is absolutely no reason to talk of a crisis of the euro.”
The European debt crisis that drove the euro to a four-year low on June 7 was rather caused by “the herd behavior of financial managers,” Schmidt said in the interview.
“Suddenly one of them realized: ‘the Greeks are too much in debt, something could go wrong there, so I’ll sell off everything that looks Greek.’ One follows another and suddenly Greece is in a huge debt crisis.”
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Comment: All in all I agree with about fifty percent of what Helmut Schmidt has done and said, but this of his comment about the anti-euro speculation hits the nail on its head. Indeed, sometimes financial markets have an intellectual crash when the average IQ of the market goes down to 50. At times like that monkeys throwing darts would do a better job, indeed.
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