Free Republic

Former Bundesbank president Hans Tietmeyer, a key architect of the euro who oversaw its introduction in Germany, has died at the age of 85, the central bank announced Wednesday. Tietmeyer ran the mighty Bundesbank from 1993 to 1999, a period that straddled the aftermath of German reunification as well as the launch of the single European currency and the creation of the European Central Bank. […] A fierce defender of the independence of central banks, Tietmeyer was credited with ensuring that the same principle was enshrined in the statutes of the ECB, which was modeled in large part on the...

The threat of “Brexit” is delivering a Christmas bonanza to Northern Ireland, where the thousands visiting daily from the euro-using Republic of Ireland are finding bargains driven by the battered pound. In the malls of Newry, a Northern Ireland town barely 5 miles (8 kilometers) from the United Kingdom’s only land border with a European Union partner, the surge in cross-border holiday shopping underscores how far the British currency has fallen amid anxiety over the country’s promised EU exit. While the euro is unusually weak against the resurgent dollar, the pound is far weaker, boosting price differentials on most goods....

The dollar’s upward march has sent the euro currency to its lowest level in 14 years, easing the financial pressure on traveling Americans but giving European exporters a boost. The euro, used by 19 countries, was down 0.1 percent at $1.0390 late-afternoon Tuesday, having earlier fallen to $1.0352, its lowest level since early 2003. Over recent days, the euro’s descent to the psychologically important level of one euro per dollar, has accelerated. A major factor has been the prospect of more interest rate hikes by the U.S. Federal Reserve following a quarter-point increase in its benchmark rate last week. Higher...

Britain’s exit from the European Union — whenever it takes place — is a cloud over the economic outlook for both the country and its major trading partners within the 19-country eurozone. Further evidence emerged Wednesday to show that businesses across the single currency bloc are fretting over the risks, while those in Britain appear to have gotten over the initial shock of the vote to leave on June 23 thanks partly to the plunge in the pound. The drop in the currency, which this week hit a 31-year low against the dollar, makes British exports more competitive. Both the...

Nobody yet knows the winner of France’s presidential election next year, but the smart money is on one loser: The three-percent cap on government deficits enshrined in eurozone rules. A bedrock of euro stability for some, the requirement to keep government deficits to below three percent of gross domestic product (GDP) is seen by many as an insufferable strait-jacket on governments wanting to spend their way out of economic sluggishness. Many French politicians, on the left and right, wonder aloud whether France should start ignoring the EU Commission and three-percent defenders, including powerhouse Germany, and break free. “The European left,...

The 19-country eurozone lost some economic momentum in August, largely because of a slowdown in Germany, a closely watched survey showed Monday, days ahead of another possible stimulus package from the European Central Bank. Financial information company IHS Markit said its purchasing managers’ index — a broad gauge of economic activity — for the eurozone fell to a 19-month low of 52.9 points in August from 53.2 the previous month. The fall was unexpected as the initial estimate for August was 53.3. In spite of the fall, the eurozone is still growing, albeit sluggishly as anything above 50 indicates expansion....

The European Union on Tuesday said US tech giant Apple must repay a record 13 billion euros ($14.3 billion or roughly Rs. 95,910 crores) in back taxes after ruling that a series of Irish sweetheart tax deals were illegal. "The European Commission has concluded that Ireland granted undue tax benefits of up to 13 billion euros to Apple. This is illegal under EU state aid rules because it allowed Apple to pay substantially less tax than other businesses. Ireland must now recover the illegal aid," a Commission statement said. EU Competition Commissioner Margrethe Vestager said Apple's "selective treatment" in Ireland...

Free trade talks between the European Union and the United States have failed, Germany’s economy minister said Sunday, citing a lack of progress on any of the major sections of the long-running negotiations. Both Washington and Brussels have pushed for a deal by the end of the year, despite strong misgivings among some EU member states over the Trans-Atlantic Trade and Investment Partnership, or TTIP. Sigmar Gabriel, who is also Germany’s Vice Chancellor, compared the TTIP negotiations unfavorably with a free trade deal forged between the 28-nation EU and Canada, which he said was fairer for both sides. “In my...

The leaders of Germany, France and Italy will meet on Monday to discuss how to keep the European project together in the second set of talks between the premiers of the eurozone’s three largest economies since Britain’s shock vote to leave the bloc. Italian Prime Minister Matteo Renzi hosts German Chancellor Angela Merkel and French President Francois Hollande on an island off the coast of Naples ahead of September’s EU summit called to discuss reverberations from the Brexit vote. “They will be coming to discuss how to relaunch Europe from the bottom up; there’s a big need,” Renzi said on...

It seems that the strong start to the year was another false dawn for the eurozone economy and that the European Central Bank will have more to do in the months ahead to shore up growth. New figures released Friday confirmed that the eurozone, which is made up of 19 countries from Ireland to the west to Cyprus in the east, suffered a sizable slowdown in the second quarter of the year despite a number of stimulus measures that the European Central Bank has thrown at it. In its first estimate for the April to June period, Eurostat, the EU’s...

Despite the shock and surprise with which many observers reacted to last month’s “Brexit” vote, the result of which begins the United Kingdom’s divorce from the European Union, the seeds of the breakup were long in the making – and entirely understandable. Notwithstanding efforts by some pro-EU proponents to paint the “Leave” camp as being filled with anti-immigrant racists, polls in the U.K. show that the primary motivation for “Leave” voters was concern over the loss of political, cultural, and economic identity that continued membership in the European Union was accelerating -- in a word, loss of sovereignty.The document at...

Greece's government is set to pass controversial pension cuts on Sunday. Retirees are livid, and unions are on strike, Jannis Papadimitriou reports from Athens.

Two of Europe's most powerful central bankers have called on the eurozone to form its own treasury and push forward with a quantum leap in integration to secure the single currency's future. Germany's Jens Weidmann and France's newly-appointed Francois Villeroy de Galhau urged member states to move towards a "comprehensive sharing of sovereignty" which would include a common 19-member treasury and an "independent fiscal council" with a eurozone parliament. [...] Their comments are a rare sign of unity from the EU's most powerful founding member states, which have often diverged on their visions for the future of the eurozone. Germany...

France said Thursday that a British exit from the European Union would be a tragedy, but warned that Britain's demands for reform could not be met at any price. French President Francois Hollande said Thursday he would be "particularly vigilant" during talks with Britain while the PM Manuel Valls said the UK was unlikely to win over EU leaders in the next few weeks. [...] "France wants Great Britain to stay in the European Union - that's in the interests of Europe and the United Kingdom," he said. "But I will be particularly vigilant so that the eurozone can continue...

History has shown that when a government wants to solidify its power, it has to turn its subjects into taxpayers. The Roman Empire demanded high tribute payments from every tribe it had newly conquered. And the United States developed from a commonwealth to a federal state when, in the 18th century, Treasury Secretary Alexander Hamilton achieved uniform duties and taxes for the entire union, initially on whiskey, because it was so lucrative. Politicians in the eurozone are now seeking to emulate the historic model from the early years of the United States. The unnerving bargaining over the latest Greece bailout...

Through all the haggling and hair-pulling in the past months over more austerity, fewer creditors getting their money, and a dreaded “Grexit”—a scenario in which Greece would leave Europe’s currency union—at least four prominent economists in three major American publications have casually and quietly suggested there may be a third way: A German exit. That is, Germany should exit the euro, and clear the way for countries in the south of Europe—notably, Greece, Italy, Spain, and probably Portugal—to reconcile their debt with a greatly depreciated currency and maybe finally get a handle on their economies. The latest thinker to suggest...

Nearly 25 years after Margaret Thatcher’s keep-Great-Britain-free-from-one-government-one-currency-one-Europe sentiment helped force her resignation, the Iron Lady has been proved right yet again. Most prime ministers are generally forced out of office over failure, like failure to win an election or failure to effectively lead their government. But Mrs. Thatcher won all three of her elections and effectively led the governments she formed. It was not failure that helped do her in, but the fear of her peers that she might win another election and effectively keep England out of the experiment to unify Europe governments. One of her convictions that got...

The situation in Athens seems to have calmed down, but former Federal Reserve Chairman Ben Bernanke thinks Europe has an even bigger issue to worry about: Germany. In a blog post on Friday, Bernanke wrote that the failure of the eurozone as a whole is very much related to the "highly asymmetric outcomes" among member nations. In other words, Bernanke is attributing Europe's woes to the fact that countries like Germany are benefiting at the expense of the monetary union's weaker members, like Greece, Spain, and Italy. Bernanke points to unemployment rates as a clear sign of the disparity in...

And probably leave the Eurozone too. If you want to know what happens when a nation absolutely refuses to reform its insane spending - even when it finds itself at the brink of fiscal collapse - I give you Greece. Not that you want it. The International Monetary Fund doesn’t. The Eurozone doesn’t. The Greek banking system is now shut down, and we’re a day away from Greece defaulting on its IMF bailout loans. When the Europeans presented Greece with an ultimatum - reform the spending now or be cut off - the most the Greek politicians were willing to...

BRUSSELS/ATHENS (Reuters) - Greek Prime Minister Alexis Tsipras summoned an urgent meeting of his cabinet on Friday after euro zone partners warned Athens it had until the weekend to accept a cash-for-reform deal or plunge towards default. Despite angry rhetoric and accusations of "blackmail", negotiations were continuing in Brussels to find a last-ditch compromise to keep Greece in the euro zone to avoid a political train-wreck, economic chaos and financial market disruption. ... He said there was no foundation for the increasing speculation in Athens that Tsipras could call snap elections if a deal cannot be reached. ... In a...