Madeleine O Hosli in the book titled ‘The Euro’

Sampson Onwuka

Title – The Euro 

Author -  Madleine O Hosli 

Year – 2005

Review – Sampson I. Onwuka

Madeleine O Hosli in the book titled ‘Euro’ raised the issue of price stability and EMU, in respect to the currency that the “…provisions of EMU suggest that the predominant goal of the ECB is to maintain price stability with some factors rendering this task difficult in practice – but possibly at the expense of some global exchange rate stability”, that for instance, Euro may rival Dollars, sprawling a world of competition that may affect the total market and financial stability of the world. The author goes on to argue that “If monetary policy were to be dominated by political interests, however, and political rationales were to determine the external value of the euro, for example, European monetary integration would constitute a threat to outsiders.” Why this point looks solid on paper, it looks very bad in practice; for sure the issue of threat to outsiders in terms of investment can only be possible if and when the price of Euro become expensive. Our author is not cornered by the price of currency as legislative intent of collative markets explains.

Our author provides the benefits of lending and cross-border price management, and explains also along the corridors of Barry Eichengreen the crass of international competition without landing the roles that Europe is bound to play sometime in later years of their very existence.  

We take that the pernicious idolizing of the power of responsible market defines an age, perhaps an age grappling with the questions of leadership and political meaning.  If take the Barry Eichengreen arguments the route to revolution it will explain Madeiline O Hosli European capable knocking down its rate of dependency on international markets.  Whereas the rise of economic convergence and global corporation is also Europe in make. A lesser view arises from the indwelling failure expressed in the struggle to patronize Europe by Europe – or Europe for Europe is prove that a future exist with East Europe adjusting to Western value. The value of this expectation is perhaps more political than financial, even more complex with the markets. But her points live through the power of the currency and corporate interest rate, decay with without a case study of the effects of unified currency – which is a market without friction leading to ‘Free-Fall’.  Her point about the age of Europe as old a fabric ridden to wear and tear and perhaps others things in life – a new coming - show a Europe emergent from current nationality to post-nationality. 

That being said, there are issues of real estate since in reality the strength of the Euro, may even welcome the exportation of dollars or sovereign wealth to ECB via Arab oils and dollars. The author of the book made the point about trans-border trade in Europe citing in stasis that “The European experience, as Barry Eichengreen contends, supports those suggesting that stable and extensive trade relationships are important prerequisites for a smooth functionary of the International Monetary system.” The fundamental difference between U.S banks and those of Euro is that U.S Banks are not allowed to engage in any form of securities lending from thesis, which is notionally the act of removing ‘debt from a company’s balance sheet and therefore a friend and foe of merger and acquisition common to the formative currency called Euro.  Madeiline O Hosli looks a history of ECB which was already calling the shot following the end of currency basket but leaves us unsatisfied with case studies on how Europe may even up between East and the West.

The Short View

 

                 Madeleine O Hosli. 

The book in spite of its authoritative wealth of information fall short of many stray points, that it is logically a book of social commentary by author’s with background in European history and finances, and the structure of the book run well.  Among the point made the author did not clearly address is the question and answer of Euro Banks, why are they allowed to engage in both forms of lending and in all forms of securities, irrespective of the Insurance product. Until Glass-Seagull Act of 1933, U.S Banks were allowed to participate in all forms Securities lending, to such disputable degree that the stock market failed, the banks failed as well. She argues that the case is even more profound in terms of how well Europe reacted to the rest of the world. In many ways than one, some of arguments made about money and about the steel industries is set in such a way that Europe may survive with shared responsibility than the effects Bank controlled market.

And secondly, she argues that the age and growth of European economic opportunity in terms of how well it manages local resources is closer to history of the banks and bank growth, than the informed psychology of financial institution. If we argue forward, she argues in drive-through that the Robert Mundell point about currency was necessarily a natural recourse that Europe headed to a destination that looked to collaborate than facts of banks and institutional businesses. Banks and their owners were prone to manipulating the stock market and inventing their own Rating and setting their own prices, a problem that somehow manages to make reappear in various forms. 

As such the houses and other components of the real estate rose and decline as the Banks saw fit, and when the political forces appeared, Banks will to being held responsible for leading or misleading the generality of the Public. These Banks pretty much operated like the European counterparts, but the rules set for SEC following the depression made impossible for them to act like their European counterparts. 

Thirdly, she argues in extension that there are a reason why whatever happens in Europe somehow manages to affect U.S and not just U.S but the general world. The fate of Europe could not lie in reasoned argument but a growing need to breach the gap between East and West of Europe, a gap that is the natural growth of nations and sovereign bounded by the multi-national corporations. In spite of the best things that can be said is that Glass-Seagull Act may have inadvertently worked for the benefit of American market, which if Europe is willing to adopt it may also help Europe. 

In the same view, there are ages in Europe called Feudal to Kingdoms to Baroque to Rococo, and then came the Classic age unraveling the weight of French and American Revolution that brought the idea of nationality. There are comparisons between those ages in Europe and the one that meet the world half way – the idea of Europe and its continental drift to the core.  The issue of tariff will stand, stand still when things in Europe and ECB hardly ring a bell for leadership, or say a Hilary from older past will not aspire and may perchance conquer. The idea of Europe running with scissors called financial indicators from Germany and France, may never explain that Frankfurt index is any different Berlin, that the lines that run through France differ in Paris along more to so, France. The link by rail is an eye problem that fetters imagination of market union – yet markets differ in spite of the Banks and its saturation of credit. 

The incident of AFX as an accounting failure became that much of back drop, it should have meant that the operation board were not aware of what was available the time of incident. As some experts once mentioned that we take it that George Steiner’s statement summarizes her book “…the future of the idea of Europe! If it has one, depends less on central banking and agricultural subsidies, on investment in technology or common tariffs, subsidies, on investment in technology or common tariffs, than we are instructed to believe.” Only to some extent, that there are things in money which politics cannot account for and things in life, which does not require the auditing of public interest to make say.