Breakup of the Ruble Area (1991-1993): A Cautionary Tale for the Euro
Good news: The euro crisis is over. At least that is how French President Francois Hollande sees it, according to remarks he made during his recent trip to Japan. Latvia’s pending entry is another piece of news for the battered currency area. Never mind minor problems like a deepening recession in many countries, unsustainable government debts in others, and faltering export performance in still others.
The good news/bad news situation of the euro should serve to remind us that currency areas do not necessarily last forever. The biggest currency area collapse in recent times was the fifteen-nation ruble area, which existed briefly following the breakup of the Soviet Union. It seems like a good time to update a little slideshow I wrote a few years ago on the breakup of the ruble area and its lessons for the euro.
Click on the image to view the full slideshow
One Response to “Breakup of the Ruble Area (1991-1993): A Cautionary Tale for the Euro”
Maybe the Euro crisis is over, but the Euro zone problems are far from over. My feeling is that the European economic crisis is rooted in something much more substantial than currency or sovereign debt problems. If in country like Spain the unemployment of youth is above 50%, and the jobs are kept by those who were luckily employed before the crisis, something is wrong. If in the society in one hand exist those who enjoy benefits of social solidarity and those who do not, and they are mostly young, something is very wrong. If the young are left out of the economic activity, and is not given to them chance to be employed or self employed, something is very wrong. If some leaders see European crisis as purely a currency problem, something is very wrong.