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Authors: Brian Kettell
Published by: Centre for Islamic Banking and Finance
Published in: 1999
Length: 20 pages
Data source: Published sources

Abstract

On January 1st 1999, Europe launched the Euro, in what will inevitably become known as the greatest monetary experiment in history. The launch of the Euro with the scheduled phasing out of eleven European currencies by 2002 was launched with great fanfare. Within this monetary experiment there are however the seeds of a troubled later life. This case describes these seeds, individually manageable, but which maturing together could herald a financial market breakdown to the extent of which the world has never seen. Remember that under the 1992 Maastricht Treaty, monetary union was intended to be an irreversible and irrevocable process and that no mechanism exists in the Treaty to allow a participating Member State to withdraw. Faultlines range from problems associated with the lack of political union within the EU to the ultimate empirical and intellectual discrediting of the whole idea in turn, leading to a mutual agreement to dissolve the system.
Location:
Industry:
Size:
Multinational
Other setting(s):
1999

About

Abstract

On January 1st 1999, Europe launched the Euro, in what will inevitably become known as the greatest monetary experiment in history. The launch of the Euro with the scheduled phasing out of eleven European currencies by 2002 was launched with great fanfare. Within this monetary experiment there are however the seeds of a troubled later life. This case describes these seeds, individually manageable, but which maturing together could herald a financial market breakdown to the extent of which the world has never seen. Remember that under the 1992 Maastricht Treaty, monetary union was intended to be an irreversible and irrevocable process and that no mechanism exists in the Treaty to allow a participating Member State to withdraw. Faultlines range from problems associated with the lack of political union within the EU to the ultimate empirical and intellectual discrediting of the whole idea in turn, leading to a mutual agreement to dissolve the system.

Settings

Location:
Industry:
Size:
Multinational
Other setting(s):
1999

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