Maastricht Treaty revisions needed?

[Jester]

We sort of have an international currency, or two. A barrel of crude oil, and an ounce of gold. Everyone knows what their currency or commodity is worth in relation to those two prime commodities.

We have internationally traded commodities. But those do not function in the same ways, either positive or negative. Nobody denominates their national debt in barrels of oil, nor do they set domestic wages in grams of gold.* So, if Greece needed to devalue in the pre-euro days, they might not have been able to buy as much oil or gold, but they could at least kickstart their economy and avoid a deflationary spiral. Now, profligate Greece is locked into the same currency as wealthy Germany, and there's no policy they can pursue that makes them both happy.

The policy that avoids crisis is to keep Greece solvent, and they're trying their best at that. But that's a heavy price to pay for having overextended the Euro.

-Jester

*They used to do that. It was called the classical gold standard - and while its success was an era of tremendous prosperity, its failure is in the encyclopaedia under "Depression, Great".