The real causes of the eurozone crisis


“It’s no coincidence that the crisis is hitting a number of eurozone countries – Greece, Ireland, Portugal, Spain – very hard. They have fallen victim to imbalances inherent in the common currency, such as stiff competition with low-wage Germany, and interest rates not adjusted to local circumstances, which in turn are conducive to speculative bubbles in the housing market and elsewhere. The imbalances were an important reason why private loans became an important driver in the economy. Once the financial crisis led to a credit crunch, they were in deep trouble.”

Read the rest of Corporate Europe Observatory’s astute analysis of the Euro crisis, complete with a video and cartoon, at Two Very Different Videos