Alan Greenspan Says Europe Needs Political Union

The single currency can only survive if the 17-country euro zone becomes a political union, the former head of the U.S. Federal Reserve told a German newspaper this weekend.

“The euro can be saved only by a political union,” Alan Greenspan said in an interview with “Welt am Sonntag” Sunday. “I do not believe that a common economic and monetary space can operate in the long term if it consists of 17 countries with 17 different social systems.”

The 87-year old, who was head of the Fed from 1987 until 2006, said that political union was the only way that the economic region was not going to break up, such were the economic differences between the member states.

During the economic crisis, he said, “the interest rates on government bonds of the southern states soared, while they remained low and stable for Germany and some other countries such as the Netherlands, Austria and Finland.”

via CNBC

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza