Friedman thesis (Friedman forecast)

The influential American national economist and Nobel laureate Milton Friedman (1912-2006) predicted that the European Monetary Union would fail at the latest when severe disruptions occur on the world markets. – As recently as October 2008, the famous Havard economics professor Martin S. Feldstein enumerated reasons why the euro area would break up into its old parts again. In reality, it turned out that especially in the financial crisis that followed the subprime crisis, the member states of the European Monetary Union were far better off than non-member countries, such as Great Britain or Sweden. Admittedly, the weaknesses of the EMU became clear at the latest after the Greek crisis. – It is also difficult to see that, with regard to economic policy, EMU has strengthened all member countries in the long term. Rather, it can be seen that accession has clearly weakened some countries. The Maastricht criteria (monetary union entry criteria) already lacked the external equilibrium (a situation in which the money a country brings in from exports is approximately equal to the money it spends on imports) of the respective candidate. In addition, the Stability and Growth Pact was softened by an agreement between Germany and France. This contributed to the fact that other EMU members no longer felt obliged to comply with the strict provisions of the Pact. – See alignment automatism, exit, Plan C, shadow state, Stability and Growth Pact, fundamental flaws, growth differentials, intra-currency area, optimal, monetary union 2, economic policy, European.

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
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