PES Manifesto

What's our response?

Published Friday, July 4, 2008 at 10:23
by franciscopolo (928 views and 0 comments)

As you all know the European Central Bank has its main goal to control the interest rates, that is to say, the price of money in the eurozone. The matter is that the Federal Reserve of the United States is keeping an interest rate much lower than the European ones. While we are having a 4% interest rate, in the States the interest rate is around 2%.

This has several consequences but the most important ones are that our companies can’t invest so they can’t become more competitive and that our products become more expensive abroad Europe so our companies become even less competitive.

If we add to all that the fact that oil is having peak prices almost everyday so everything is becoming more expensive for them, the result is easy to see: they are trapped.

In order to face this situation “the European Central Bank should ask itself not only about inflation but also about economic growth”, Mr. Sarkozy said. “You can double interest rates and that will not make go down the price of the Brent barrel”.

This is a position held by Sarko. I wrote about it yesterday in my blog. And then I wondered…

What’s our political response to the economy crisis?

Tags: blogger of the week, economy, employment, investment