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"The euro is a credible currency," he added.
Any credible currency needs backing by a strong government.
Truly credible currency boards can avoid them.* "Currency Board Arrangements: Issues and Experiences".
The Union is suffering from them at a time when the euro needs federalizing measures to be a credible currency.
Greek banks would fail, the country would default on its debt and would lack a credible currency with which to buy essential imported goods like oil or food.
Even so, countries bounced back more rapidly at times when they were using a fixed and politically credible currency regime such as the gold standard (and now, it will be hoped in Europe, the euro).
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Despite Nigeria's bold move, the Chinese renminbi still has few of the qualities of a credible reserve currency.
Writing on the Times Op-Ed page recently, Jeremi Suri of the University of Texas said that the Obama administration should set three realistic international goals: maintaining the dollar as the credible global reserve currency; halting the proliferation of nuclear, biological and chemical weapons; and cultivating peaceful relations with China.
As any average person in charge of European affairs acknowledges, these policies are a vital contribution to the strengthening of European public finances, fighting unemployment and making the projects for a single currency credible vis-à-vis the US dollar or the Japanese yen.
Mr Sumner's disinhibition is to encourage the Fed not to care which of the two is doing more of the work.Central banks set targets to make their currencies credible and their policies predictable.
Facebook Twitter Google plus Share Share this post Facebook Twitter Google plus close 1.44pm BST13:44 Osborne says he is surprised the SNP have not developed a credible plan for the currency.
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