The European Union

A currency that crosses borders and cultures sounds wonderful, and in a lot of situations it is quite convenient. There are some limitations regarding a currency like this. I am going to look at the European Union and then share with you some other news worth noting.

When you have a group of countries such as the European Union, you have lots of different economic situations within that union. Economically, some of these countries are expanding, some are contracting, and some are in the middle. I would like to focus on one country and how the Euro is killing its economic growth...Germany.

Germany is the largest exporter of goods in Europe. Any country who exports looks to value from a weaker central currency. Just look at China for example, they purposely keep the yuan repressed in order to make their goods cheap on an international level. Germany's ability to export goods relies strongly on the euro remaining weaker in value. That is exactly what has NOT happened. The euro has gain 10% in the USD in the last 12 months, and was one of the best performing currencies world wide.

Now, you know my views on fiat currencies, I despise them. But, I believe, in the long run, the stronger a currency the better for that country. It increases its buying power. I'm not going to get into that. I would like to stay focused on Germany.

The Ifo Institute Sentiment Index (IISI) fell from 107.9 in January to 107. This is an index based on 7000 executives confidence in the economy. That is the biggest decline for that index in 6 years. GDP growth is expected to fall a full point from 2.7% to 1.7%. German executives across the nation expect lower earnings this year, and the most important statistic that I am going to share with you is that exports are predicted to 7.9% this year from 13.7% in 2006. This is an economy driven by exports. The strong euro is killing Germany's ability to export goods.

If the Germans still had their own currency, they would be keeping it weaker; hence, driving up exports and they would be amidst a thriving economy. So you can see, a strong euro is good for some countries and bad for others. It is impossible to appeal to the economic situations of all the counties involved.

This brings me right up to my next point. I am going to throw a little something at you. I strongly encourage you to read on even after I say it. Please don't throw your computer and scream, "WHAT A FREAKING MORON!!" Here goes nothing...North American Union. Mexico, Canada, and the United States. Three countries, one currency, no borders. Now, I'm not saying I'm for it, or against it. There are lots of pluses and minuses regarding this idea. I would like to share with you the news and action regarding this idea, so please bare with me.

In 2006, 30 CEO's from Mexico, Canada, and the U.S. formed the North American Competitiveness Council (NACC). Their goal is to advise political leaders on strengthening economic ties between the three countries. The report hasn't been published, but this mourning they said they have the preliminary review and they have derived 51 recommendations. U.S. Secretary of State Condoleeza Rice, Mexican Secretary of Foreign Affairs, Patricia Espinosa, Foreign Affairs Minister Peter Mackay, and Industry Minister Maxime Bernier, will be meeting in Ottawa to discuss these recommendations.

The CEO's have said that they have come to a general consensus on a number of issues. I look forward to reading these reports, but having not read them, I believe it is a positive that CEO's across these three nations were even able to agree on a number of issues. I can tell you some of the issues that were discussed. Mexican workers developing the skills to work in Canada's oilsands, Mexico's need for advanced technology in their oil fields, the production possibilities of the U.S. and Mexico's oil shale operations, an open borders, single currency North American Union, and last but definitely not least, a Security and Prosperity Act that would "fend off economic threats from India and China."

There's a strong belief that you and I, as well as the NACC, believe that we should be spending our money developing North America's production and not funding a war that can't be won.

I believe that the largest issue here would be mass emigration/immigration, mainly from Mexico. These are things being looked into by the NACC, and I don't feel I should comment on them. I will tell you more after I read the reports.

This could be a win/win/win situation, maybe with the U.S. being the biggest winner here. Once again, please don't yell at me for saying that. By the time something like this might happen, the U.S. will be drowning in red ink and such an economic debacle that the surface won't be in near site. Where are all the resources in N. America? Canada and Mexico. Mexico, in my opinion, has the ability to be the largest supplier of silver in the world. Canada has got access to huge amounts of oil, uranium, and other resources. While the U.S. can offer to distribute its higher quality of life, along with advanced mining and drilling technologies.

I don't want to say anything else on this topic until the final reports are published, but I feel this is very interesting stuff. I have pointed out a weakness in an agreements of this nature, and I strongly belive that U.S. citizens would be strongly opposed to this being that they generally thing they are better than everyone else.