Exchange Rates Euros : Who Would Benefit if The Euro Fails?

January 28th, 2013

Exchange rate euros have been in a state of decline for some time. The euro was always intended to make the European market more accessible and proficient. One of the main ideologies was that barriers to trade would be reduced and the euro zone would become more fluid and accessible. If the euro fails, manufacturers outside of the EU would profit the most. This is mainly attributable to the increased costs that European exporters would be exposed to if the euro was to fail, this would force export prices up and make competitors from China and US, a more attractive prospect.

The European Union eliminates other obstructions to trade and commerce, it creates free movement of goods, employment and provides a platform of common trading rules and regulations, all of which increase the efficiency of the European economy and movement of goods and capital. The death of the euro would eliminate all of the benefits it has created for businesses, particularly exporters. There would be no European foreign currency or exchange rate euros, the individual nation states would revert back to their national currencies.
Essentially the euro was created to provide its member states with a competitive edge, the amalgamation into a single monetary currency was intended and succeeded in enhancing the European economy. It is very apparent that the creation of the EU and the euro is of huge benefit to the businesses of its member states. For these reasons it will not be disbanded without a fight.

If it were to collapse then there would be immediate benefits to competitors in the US and China who would become more competitive, but conversely there would be huge cost to the overall world Gross Domestic Product. Many are actually rooting for the collapse of the euro. Those in America  in particular, who view the euro as a threat to the US dollar as a world dominating currency. The dollar is and has always been the worlds reserve and dominant currency purely because of its scale and size. However the euro is possiblyAmerica’s biggest threat and competitor. If the euro can sort out its debt crisis, there is no reason why it can’t go on to flourish and individuals and businesses can start to experience excellent exchange rate euros again, a position once held when the Euro was strong. On recovery of the euro debt crisis,Americacan expect to have a serious contender for world currency domination.

The dollar can take huge losses before it affects its value.  The euro represents an even bigger reserve of stability, assuming they manage to get their debts straightened out.  Internal dissension makes the larger currency less stable.  SoAmericabenefits from euro dissolution by removing a currency competitor.

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