I just can’t get out of my mind what Europe is doing. It looks like Europe is fighting against itself. We should learn the lesson from the non-European countries like USA, Japan…
The budget deficit of these countries is bigger than the budget deficit of the different European countries, and nonetheless they are able to get money with lower interest rates. Their unemployment rates are not going up as much as European rates, their GDP’s are not decreasing as much as ours. Obviously, something is happening in Europe than is not happening in the foreign countries. What is it? Austerity, damn austerity.
I attach here a graph which shows the correlation between harsh austerity measures and mass violence.
The lesson Austerity is giving us is quite simply. The more austerity, the more serious the problems become (higher unemployment rate, lower economic growth, bigger social problems…)
To make matters worse, we have to add the problems of the same currency. If we had our own currency like USA or Japan, we could devalue it and become more competitive.
Anyway, austerity IS NOT the solution. Keynes was right and what we need is some more inflation. Please, Europe take into account the lesson the world is giving to us.