-- The euro is losing out to the dollar as renewed concern over the solvency of nations from Portugal to Ireland points to another slump for the common European currency.
Hedge funds and other large speculators have increased bets on a weakening of the euro to the highest level in almost two months, according to data from the Commodity Futures Trading Commission. Investors are paying close to the most in three months to insure against losses on Greek and Spanish bonds, while yields on Irish and Portuguese government debt surged to records relative to benchmark German bunds last week.
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Comment: At the time of publication of this post the euro is back over 1.28 against the dollar, up more than one percent.
For your pleasure enjoy the "level" of analysis that is currently en vogue by having a look at the book that I posted. Grant Wonders is not only uninformed. He doesn't know what he is talking about, yet his analysis is made worse by an economic education which has blown out most of the sound reasoning he probably had before he began to study economics. It is absolutely ridiculous to state that the European Monetary Union has Mundell's modell of an "optimal currency area" as its foundation. The idea that vast labor movement were necessary to cope with industrial fluctuations is more than ridiculous, and one could go on.
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