The Spanish Prisoner: Pros and Cons of a Single Currency
Article: http://www.nytimes.com/2010/11/29/opinion/29krugman.html?_r=1&scp=1&sq=spain%20paul&st=cse
The article highlights the pros and cons of implementing the Euro, which is the single currency that exists in most of the European nations. The article focuses primarily on Spain, who has experienced both upsides and downsides of having a single currency. In the case with Spain, the advantage of having the Euro was the idea of big is better, which encouraged investment in the currency zone. Investors viewed the Euro as a strong currency, due to the fact that many nations were using it, and so they invested heavily in the currency. it. For a while, the increased investment spurred the growth of the Spanish economy. Other advantages of a single currency includes: cuts converting costs, increased transparency competition within a currency zone, and reduces uncertainty within the currency zone. The disadvantage of the Euro that was apparent was that a uniform monetary policy may not fit all in the currency zone. Spain is now experiencing a trade deficit, and in order to fix that, they need to devalue the Euro. However, this would influence all other European nations that are using the Euro, and many would oppose such an action. Therefore, they have no choice, but to use other, tougher methods to fix their economic problem. Other disadvantages of a single currency includes: policies may have different effects on members, and transition costs.
Kenny you need to explain things, you can not just list words.