Mr. Jim Rogers has been travelling around the world commenting on what he observes. It has been more than a ytear since he wrote an article on western Europe and the euro, but it's still a GREAT article. I am posting paragraphs 5-9, then the address to see the full article.

****************************************************** Here in Europe we're obtaining a first-hand flavor of Europeans' attitudes toward the newly formed euro, which seem uniformly positive. Prices are often presented to us in both the local currency and in euros, even though euro bills or coins don't yet exist and won't exist for three more years. As a consumer, you are only able to use euros with a check or a credit card. So you can pay your Macy's credit-card bill in euros, but you can't use a euro to buy a pint at an Irish pub or a sandwich at a Paris bistro. Bills and coins are supposed to arrive on June 30th, 2002, but Europeans' response to the euro's formation has been so enthusiastic that there's talk of cranking up the printing presses early. It's often noted that 30% of the world's trade will be denominated in euros. No matter what the degree of enthusiasm, it's going to take months and years to adjust vending machines and telephone coin slots and gas pumps to take the new notes and coins.

My contrary nature has been aroused to full alert by all this enthusiasm. Very few enterprises this popular ever fail to trip over their own feet. That is, such ideas might or might not work at inception, but such enthusiasm encourages the sponsors to overplay their hand, inviting disasters. In particular, the euro managers haven't built into their organizational structures any sound means of handling the nationalistic caused by economic problems and financial disruptions. For example, will the Germans pay for Spain's banking mistakes? I don't think so. I expect if a Spanish bank fails the Spanish government will force a merger or nationalize the bank, but here's nothing that says this is how the crisis will be resolved. Even so, the concept of the euro seems to be sinking in on Europeans and makes me think the euro will sustain itself for a while. Still, there's a long way to go. As a trivial example of the continued fragmentation of Europe, even today you can't rent a car in Dublin and drop it off in London, about the distance from New York to Boston.

It's important not to forget the larger picture, and I'm concerned that those in power in Europe may be doing just that. Europe's leaders are ignoring the region's deep-seated structural problems. Some background is important here. It was 15 conservative governments in 1992 that conceived and planned the euro. The European Union set strict criteria for entry and last year judged 14 nations had met them. Of course the EU had to allow the fabric of many nations' finances to be stretched to fit the criteria-various countries' finance ministers cooked the books and the judges turned a blind eye--but in the end all but Greece managed to cover their warts and even conceal a missing limb or two. Despite all the Euro-hoopla and Euro-jingoism, Sweden, the United Kingdom, and Denmark opted out.

Today, however, most of the euro-zone countries are run by left-leaning governments, whereas the originators of the euro-plan were right-leaning governments. That is, those who planned the euro were interested in sound money first and jobs and growth second--the only way to insure a country's long-term growth and stability-while those in power now are more interested in jobs and growth first, with a sound currency second, the usual left politician's means of obtaining the votes he needs to stay in power over the short run. **************************************************

Go to http://www.millenniumadventure.com/content/stories/article_austria_1.html

-- Rick (rick7@postmark.net), February 16, 2000