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Originally Posted by Seaver
I dont want to sound smug or anything but everyone knew this was going to happen. Very few of the countries in Europe have good self-sustaining economies. It was an obvious FU when they set the Euro to such a high value compared to the Dollar. Unfortunately the economies of Europe could not sustain the high value, as well as the sudden added expense of tourism because of the exchange rate many Americans simply stopped going there, further hurting the economies.
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You make it sound as if the politicians are to blame for the exchange rate of the Euro vs. the dollar.
Initially, the Euro was set high against the dollar. During the next few months, the Euro lowered in value. I remember it being lower than 1:1. But recently, the Euro has gone up again. This can only happen if international trade forces the Euro up. It's not something the politicians can control.
Some European economies can sustain the higher value, while some can't. We in the Netherlands would prefer a lower Euro, because it'll mean more trade with the US. OTOH, unless Europe *also* increases it's imports from the US, the Euro would go up again. (and that increase is unlikely, given the higher price we'd need to pay!)
The fact that Europe is getting more expensive for Americans is a good thing. Your imports are too high compared to your exports. The exchange rates respond to that by making imports more and exports less expensive.
The whole discussion about getting rid of the Euro has little to do with the exchange rate of the Euro vs the dollar. It's about countries (such as Italy) wanting to control their economies using interest rates and exchange rates (vs the rest of Europe), at the expense of higher inflation.
Dutch people who want to do the same, seem to forget that our currency and interest rates had been linked to the German rates long before the Euro arrived.