The ramshackle tour company for the happy death of the Euro (even enthusiastic about the modest success of the proactive referendum) lacks memory of not too distant events: certainly before many of them came into the world: but for these new entries there are good books and handbooks that should be consulted before saying what you think. Thus, as the old adage goes, one might amaze the listener if one thinks before one speaks.
Other extremists of the tour company however, of ancient communist political culture, do not remember that Lenin maintained that extremism is the infantile disease of communism and therefore posed the problem of What To Do? Would it have come out of the Euro? Too smart and knowledgeable of history to do that.
Without pretending to carry out imaginative and undocumentable exercises on what would happen to Italy if we left the euro, it is worth reflecting on what happened in our country when we got out of the monetary snake and what could happen if, by analogy, we got out of the euro.
It was the year 1973 and in February Italy exited the monetary snake. The exchange rate between the Italian lira and the German mark passed from the usual 160-170 lire for a mark in 1971 to 260 lire in 1974. In the event that the company of good death wins, after the exit from the euro the exchange ratio would be mainly between the lira and the value of the euro imposed by Germany, therefore, other things being equal, the lira would depreciate in comparison with the euro up to having to pay 1.800 lire more for one euro, or about 3.800 lire. Short-lived benefits for exporters, but great suffering for the service industry which does not export but still has to import goods from abroad.
Against the devaluation of the lira against the mark domestic inflation from around 5 percent to above 10 percent in 1974. The consumer price index rose nearly 63 percent between 1973 and 1976-77. Does the company of the good death of the euro wish such inflation? Or how would you counter it? Il Che Fare, for example, on the inevitable feedback of inflation on government bond yields whose nominal yield index also grew by 60 per cent. Obviously, real yields on government bonds being equal, it is public interest expense that must follow real inflation.
Allora the share price index on the Milan Stock Exchange, deflated by the consumer price index, fell 40,6 percent during 1974 and a further 19,5 percent in 1975. Perhaps some of today's extremists would evaluate the collapse on a par with the much-desired patrimonial on financial wealth. And since the borders cannot be closed to the movement of capital, the company of good deaths should take charge of the impetuous outflow of capital (see Greece today)
The numbers are boring and the comparisons unsympathetic but they could oblige the actors and comedians of the tour company of the good death of the euro and not promise that after his death we will enjoy heaven on earth, even if reduced to the Po valley and the Alpine valleys .
