Over on Clouded Outlook we find the perfect example of why the euro-zone is functioning so dismally.
Alice Cook is comparing the housing market in Vienna and Dublin (see above) and wonders what the ECB is to do. Lowering interest rates would help the Irish, but heat up the booming property market in Vienna even further, ensuring a massive bust in the near future. On de other hand, increasing interest rates would cool the Vienna market, but push many a Irish home-owner into default.
We are caught between a rock and a hard place. Whatever the Eunion and/or the ECB decides, people will get hurt in the end. That single currency was a grand idea, wasn’t it?