Monday, August 12, 2002

The Tattered Euro

A week or so ago, I referred to Milton Friedman's opinion that the Euro currency would collapse within five to ten years. Well, apparently it's happening already. According to officials at Germany's Bundesbank, the Euro notes wear out after only three months of use, making them substantially less durable than the old national German curreny. And if that isn't bad enough, the color used on the notes is highly abrasive and causes bank machines handling the notes to fail.

But if the costs for replacing cheaply made notes aren't enough, there are also reports from the Berliner Zeitung stating that banks are now charging greatly inflated rates to tourists entering the EU when they exchange foreign currency. And many Danes, who voted to keep their national currency during one of the only referenda held on the subject, have had difficulty changing their notes in southern EU countries.

So much for convenience and reduced costs.

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