Was the Deutsche Mark Sacrificed for Reunification?

Ulster-Lad

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As the German people celebrated the fall of the Berlin Wall, the governments in Bonn and Paris were secretly haggling over European monetary union. According to internal government documents, the negotiations almost collapsed. Was West Germany's beloved currency, the deutsche mark, sacrificed at the altar of reunification to win France's support?

The architect of Germany's reunification is furious. Current Finance Minister Wolfgang Schäuble, the interior minister under the then-Chancellor Helmut Kohl, has deep furrows on his brow as he fires off a series of expressions of his immense dissatisfaction. They are harsh words, but ones the chief negotiator of his country's reunification treaty does not want to see in print.
"Abandoning the deutsche mark for the (equally) stable euro was one of the concessions that helped pave the way to German reunification," Steinbrück wrote.
The Price of Unity: Was the Deutsche Mark Sacrificed for Reunification? - SPIEGEL ONLINE - News - International

This is apparently causing quite the stir in Germany with much debate at the moment. If this proves to be true it may in fact bring down the Euro. An interesting read nonetheless.

Another related article is here.

Germany's Unlikely Diplomatic Triumph: An Inside Look at the Reunification Negotiations - SPIEGEL ONLINE - News - International
 


evercloserunion

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Every day there is something else that "could bring down the euro". It's not happening.
 

ne0ica

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I heard in mentioned a few years ago that Mitterand said he would block German reunification with a German commitment to a Single currency. Spiegel only seems to run negative stories about the cost of reunification so it fuels West German grievances over the cost.
 

Breadan O'Connor

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The Price of Unity: Was the Deutsche Mark Sacrificed for Reunification? - SPIEGEL ONLINE - News - International

This is apparently causing quite the stir in Germany with much debate at the moment. If this proves to be true it may in fact bring down the Euro. An interesting read nonetheless.

Another related article is here.

Germany's Unlikely Diplomatic Triumph: An Inside Look at the Reunification Negotiations - SPIEGEL ONLINE - News - International

The Deutschmark was the strongest currency for years

I saw a graph one time of how the British pound lost value consistently against it over several decades.

I presume all the other European curencies lost against it also.
 

Ulster-Lad

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The Deutschmark was the strongest currency for years

I saw a graph one time of how the British pound lost value consistently against it over several decades.

I presume all the other European curencies lost against it also.
Yes that is true. If you read the articles you will see the resentment that has grown for the Euro as well in Germany. The Germans have always valued the DM and according to the articles the DM was sacrificed for German reunification. That was the price demanded by France.

The Euro is still very unpopular in Germany and the Germans are becoming more and more Euroskeptic. They would much rather take care of their own and abandon the European project given the choice. Merkle has having internal difficulties in regards to this within her own party.

The Germans have about reached their limit on their desire to bail out the other European countries while they are suffering austerity measures of their own in the most productive country in Europe. There are numerous reports on this on the web and news articles from Germany.
 

Highking

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In difficult times resentment always grows against the political establishment, so it's no surprise that people are growing more euroskeptic, but lets be honest whilst the European Union isn't as democratic as one would like, and it wields more power than it ought to, it's a drastic improvement over the feudalism that existed in Europe up until the 1800's, and the nationalism that existed afterwards.

Once the economy picks up anti-Euro, and anti-European sentiment will probably be forgotton along with many other grievances until the next recession, all these trends are cyclical.
 

Pauli

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The Germans hated giving up the D-Mark and had there been a referendum in Germany on its abolition, an overwhelming majority would have voted to keep it. While the Germans have a jaundiced view of their politicians, they tend to trust their public institutions and they trusted and respected the Deutsche Bundesbank, particularly just after unification when the Bundesbank was led by Karl-Otto Pohl and followed by Dr. Helmut Schlesinger. Schlesinger was Bundesbank Chairman when the UK was forced out of the ERM on Sept. 16th, 1992 and he refused to come to Norman Lamont's aid. The UK wanted Schlesinger to lower German interest rates. Schlesinger refused. The story goes that a Bundesbank official informed a British official that since Schlesinger didn't listen to German politicians, he was hardly likely to listen to foreign ones.

Any Germans I know would have the D-Mark back in a flash.
 

kerdasi amaq

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Ireland could be the trigger that brings down the Euro and with it the rotten European Union.

As one of great men said: "He who builds on lies, rears only lies".

The European Union is reared on a mountain of lies.
 

Ulster-Lad

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Germans oppose IMF fiscal safety net

Germany's Bundesbank is opposed to the establishment of an IMF global fiscal safety net to help countries facing funding problems, a source at the central bank said today.

"Such a permanent crisis mechanism would increase risk taking by market participants," a Bundesbank source said.

"Also instituting such a mechanism would mean an attack on the monetary policy autonomy of large member states with reserve currencies."
BUSINESS WORLD - Germans oppose IMF fiscal safety net

Anyone know what a 'reserve currency' is? Does Ireland have one?
 

locke

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A reserve currency is one that is held in national reserves (basically a backing for a local currency).

The dollar is the main reserve currency. The Euro is the other principal reserve currency.

To a lesser extent, sterling, the Yen and the Swiss Franc are important.

Other currencies are held in pretty negligible amounts. It's also pretty unlikely that a currency that is pegged to another currency (e.g. HK Dollar) would ever be a reserve currency, no matter how important an economy or financial centre is.

As Ireland is a Euro member, we have a reserve currency. However, we are not large.
 

Ulster-Lad

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thanks locke!
 

kerdasi amaq

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Al.

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A reserve currency is one that is held in national reserves (basically a backing for a local currency).

The (US) dollar is the main reserve currency. The Euro is the other principal reserve currency.

To a lesser extent, sterling, the Yen and the Swiss Franc are important.

Other currencies are held in pretty negligible amounts. It's also pretty unlikely that a currency that is pegged to another currency (e.g. HK Dollar) would ever be a reserve currency, no matter how important an economy or financial centre is.

As Ireland is a Euro member, we have a reserve currency. However, we are not large.
Now we all know why the German elites will not give up the euro so readily. They have control of a reserve currency that is in serious competition with the US dollar. (Physical control too, since the ECB is on German soil.) What's also funny is that the euro was patterned after the deutsche mark.

Reserve currencies are important because of their use in international transactions, as well. Commodities like oil, gold and other precious metals/minerals, wheat, coffee, sugar, et al are all bought with reserve currencies in order to avoid transaction costs associated with exchanging their domestic currency. Reserve currencies also allow countries to borrow money at better rates, since the reserve currency will always be in higher demand.

The euro, though, was set up to fail. Romano Prodi was especially candid about the fact that the euro was so set up in order to create a crisis for which the solution would be for Brussels to grab more power (and in so doing, Berlin grabs more power, since Brussels is their proxy). Take note of the fact that Germany has been buying up gold like crazy; will they use this to back the euro or another currency of their own devising if the fiat-currency euro does experience a big crisis? Switching back to the deutsche mark would please the populace in Germany, and given that there are already plans afoot to create a super-eurozone with possibly a separate currency to leave the "smaller" countries as vassals, the means are already in place.
 
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Breadan O'Connor

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I posted this before.

Russia Today claims all German political parties are supervised from America, the German army is forced to take part in NATO missions(Afghanistan) and German gold is stored in America.

Max Keiser has also drawn attention to the fact that all German gold is stored in America.


[ame=http://www.youtube.com/watch?v=wGjkQAa9I34]YouTube - Germany's sovereignty restricted by US and allies?[/ame]



[ame=http://www.youtube.com/watch?v=EzVhzoAqMhU]YouTube - Max Keiser - "Brown's Bottom" - (Documentary)[/ame]
 

Al.

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I posted this before.

Russia Today claims all German political parties are supervised from America, the German army is forced to take part in NATO missions(Afghanistan) and German gold is stored in America.

Max Keiser has also drawn attention to the fact that all German gold is stored in America.
Thanks for the Russian-sourced German propaganda, but the fact is that the USA doesn't force the Germans to do anything; in fact, Germany's been bossing the USA around for a long time, especially since the 90s when they induced the USA via NATO to break up the Balkans for them again, doing what Kaiser Wilhelm II only wished he could have gotten the USA to do for him. Germany's got you wrapped around its little finger.

As for Afghanistan, I take it that you have no clue how long Germany has been entrenched there. The German elites have "permanent war" and partition planned for that country once the USA is forced out.
 
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Al.

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Der Spiegel reports that opposition to the euro is growing in Germany. A new poll has a majority of Germans (57 percent) would rather have the Deutsche mark back.
 

Old Mr Grouser

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Now we all know why the German elites will not give up the euro so readily. They have control of a reserve currency that is in serious competition with the US dollar. ...
Tripe.

The Deutschmark was a major reserve-currency, and would quickly become one again.
 

Al.

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Tripe.

The Deutschmark was a major reserve-currency, and would quickly become one again.
The Deutsche mark was never a world's reserve currency. It never at any time attained to what the euro has attained, and it never competed with the US dollar.

Think before you post next time.
That was the percentage who thought Germany should have kept the mark and not joined the euro. Only 36% think the mark should be brought back.
Umfragen
Duckspeak. The same percentage that think Germany ought to have kept the mark also want the mark back. There isn't going to be a sizeable percentage (or any percentage) that voice such an opinion and are apathetic about the euro at the same time.
 
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osioradain

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AI I'm interested to find out how you think Germany bosses the US around? and the Deutsch Mark was a major reserve currency before the Euro, second only to the US Dollar. You are right that it was no competition but it accounted for about 16% of foreign exchange reserves in 1998 (Dollar had about 70%).
But I am seriously interested to see why you think Germany can dictate to the US. Honest question.
 


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