A Review on an Article: If the European Economy Is So Shaky, Why Is the

The member on the Economist, If the European miserliness is so shaky, why is the euro so cockeyed? by R.A is explaining why and how the lever of euro is distillery remaining strong, even though the parsimony of Europe is leaving through and through umteen struggles. Through proscribed the word, it is discussed how delay of a nones whitethorn not always be level-headed improvement and what negative consequences the appreciation of a currency can lead to. The article also states how the moves of the supplant place cannot easily be explained and goes into further details nigh the euro interchange rates. The article starts by stating that recently the euro zone has been facing a good veer of improvement in terms of economy and managed to pull out of the recession. In the euro zone, the unemployment is decreasing and worries regarding the crises are disappearing by the time. However, there is the apprehension of deflation. As the article continues, it explains how app reciation of a currency can score problems that are very significant and serious. In order to better explain this point, an congresswoman of the US cars is given in the article if US clam appreciates compared to euro or yen while the price of the cars do not vary, it allow be more(prenominal) expensive for the countries that uses euro or yen as their currencies to bribe US cars. As a result of this appreciation in the prise of dollars, the make out of cars exported will decrease in the United States. This is exactly the similar dry land why Europe has a fear for a strong currency the strong euro currency makes European goods and services more expensive to another(prenominal) nations and thus, lowers the amount sold abroad. Also, since the households, firms and government is cutting back, the development and emergence of the economy is highly dep... ...s products and services in demand throughout the globe, accordingly the euros strength, at least as determined by the d emand spatial relation of the equation. The fork out side of the equation would involve to what degree the European rally slang is pushing credit expansion, which t closedowns to push the value of the euro downwards.In rundown to this, the article uses some expressions that does not sound very right when idea about a big economy as Europe for example, it is mentioned in the end of the article that, The surest way to bring it down is to make more euros. European system certainly has a slow, hardly predictable rejoinder time, many variables, and its behavior is definitely nonlinear. Thus, using such a elemental and substantial forward expression regarding the exchange rate of euros may not be very right thing to do, even though it is a be statement to some extent. A Review on an Article If the European Economy Is So Shaky, Why Is theThe article on the Economist, If the European economy is so shaky, why is the euro so strong? by R.A is explaining why and how t he value of euro is still remaining strong, even though the economy of Europe is going through many struggles. Throughout the article, it is discussed how appreciation of a currency may not always be good improvement and what negative consequences the appreciation of a currency can lead to. The article also states how the moves of the exchange rates cannot easily be explained and goes into further details about the euro exchange rates. The article starts by stating that recently the euro zone has been facing a good trend of improvement in terms of economy and managed to pull out of the recession. In the euro zone, the unemployment is decreasing and worries regarding the crises are disappearing by the time. However, there is the fear of deflation. As the article continues, it explains how appreciation of a currency can cause problems that are very significant and serious. In order to better explain this point, an example of the US cars is given in the article if US dollar appreciates compared to euro or yen while the price of the cars do not vary, it will be more expensive for the countries that uses euro or yen as their currencies to purchase US cars. As a result of this appreciation in the value of dollars, the number of cars exported will decrease in the United States. This is exactly the same reason why Europe has a fear for a strong currency the strong euro currency makes European goods and services more expensive to other nations and thus, lowers the amount sold abroad. Also, since the households, firms and government is cutting back, the development and growth of the economy is highly dep... ...s products and services in demand throughout the globe, hence the euros strength, at least as determined by the demand side of the equation. The supply side of the equation would involve to what degree the European Central Bank is pushing credit expansion, which tends to push the value of the euro downwards.In addition to this, the article uses some expressions t hat does not sound very right when thinking about a big economy as Europe for example, it is mentioned in the end of the article that, The surest way to bring it down is to make more euros. European system certainly has a slow, hardly predictable response time, many variables, and its behavior is definitely nonlinear. Thus, using such a simple and straight forward expression regarding the exchange rate of euros may not be very right thing to do, even though it is a correct statement to some extent.