Mario Draghi, who was president of the European Central Bank at the time, made a speech in July 2012 that is today recognised as having saved the euro. At the time, he declared, “The ECB is prepared to do whatever it takes to protect the euro, and believe me, it will be enough.
Because of Greece’s debt crisis, the economies of the euro zone were becoming less stable. It was necessary for the ECB, the nation’s central bank, to take action.
The euro and the euro zone are still in place ten years later. But one of the fundamental problems at the crisis’s foundation is still present. In fact, it resurfaces whenever there is economic pressure in the area.
According to Angel Ubide of the hedge fund firm Citadel, the following is the core of the issue in the euro zone: “Different financial or funding conditions exist between two identical businesses or families simply because of where they are located in the world. In that regard, your eligibility for funding is significantly influenced by your passport.”
Of course there should be disparities, he continued, but when those differences become significant, we might claim that monetary policy has become disjointed.
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