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Using the same currency makes it easier to figure out what you’re paying and spot if you’re getting ripped off on holidays. For example: €100 EUR = 41,172.31 H

Using the same currency makes it easier to figure out what you’re paying and spot if you’re getting ripped off on holidays. For example: €100 EUR = 41,172.31 HUF (Hungarian Forint)

input_sh 2y ago
Technically, the whole country could just switch to Euros without even being in the EU. Granted, the only two countries to do so (Montenegro and Kosovo) never bothered with creating their own currency to begin with, they went straight to Euros post-independence (with some disgruntlement from the EU). And then there's also two (Bulgaria and Bosnia) which are technically not using Euros, but their currencies are pegged to Euros and stupidly simple to convert (1 EUR = 1.95583 BAM/BGN, so just multiply/divide by 2).
- madars 2y ago
  Denmark is also in ERM II and 1 EUR ~ 7.46 DKK with a very tight band https://en.wikipedia.org/wiki/European_Exchange_Rate_Mechanism?useskin=monobook https://en.wikipedia.org/wiki/European_Exchange_Rate_Mechani...
- jefftk 2y ago
  I wonder why they pegged at 1.96 instead of 2?
  - _Microft 2y ago
    They had pegged their currency to the DM (Deutsche Mark) and 1.95583:1 is still exactly the same exchange rate as when DM were converted to Euro.
- gottorf 2y ago
  > 1 EUR = 1.95583 BAM/BGN, so just multiply/divide by 2 Why didn't they just set the peg to 2?
  - wolpoli 2y ago
    Likely to make it simple for retailers to accept euro. Making it exactly two means the retailers would lose money on the exchange spread. Another example is with 1 hkd = 0.97 mop.
    - xxs 2y ago
      That's a proper speculation, not very much grounded in the reality. Also the Euro is not accepted to this day in retail in Bulgaria.
  - xxs 2y ago
    B/c the conversion to Euro happened later. It was already fixed after the hyper inflation in 1997. The initital rate was 1000 levs = 1 DM, in 1999 there was a denomination of 1000 : 1, same year the Euro happened and the Deutsche mark enjoyed the same rate to the Euro.
- deleted 2y ago
  [deleted]
graemep 2y ago
Using the same currency without a common fiscal policy and resources is a disaster. It means currency and interests rates cannot be tuned to each country's economy. It means governments cannot borrow in their own currency (which is cheapest). There is a reason almost all countries have their own currency. The hope was that the single currency would be soon followed by political union. Without this the Euro has been a disaster, leading to the European debt crisis, and painful austerity as the price of bailout.
- richjdsmith 2y ago
  Couldn't agree more. Greece is a great example of what happens to a country when they have a sovereign debt crisis and no control over the value of their currency. The ability to control your overnight bank rates, and your monetary supply is important. I don't think the convenience of easy travel or easy(ier) trading of goods outweighs it at all.
  - apeescape 2y ago
    Greece cheated their way into EUR. They didn't meet the requirements, so they cooked the numbers with the help of GS. This later on blew up into everybody's faces (well, everyone except GS's).
  - addicted 2y ago
    Greece showed the flaws with the EU. The good thing is that the EU has improved since then. On the flip side, Greece is also a great example of how powerful the EU can be. Greece would have absolutely collapsed outside the EU. So even with the limitations on the EU, Greece did a lot better within the EU than it would have outside.
    - drtgh 2y ago
      > The good thing is that the EU has improved since then It was indeed a big backdoor attack to the Euro, exploited by GS [1], at least. > Greece would have absolutely collapsed outside the EU. Meat for the IMF, BlackRock and so on; Argentina's twin. Global economy seems to be an ocean with Orca whales, they hit and eat alongside with sharks. The citizens turns to meat at same moment their politicians betray them [2], whether caused by ignorance or by malice (corruption). [1] https://www.theguardian.com/business/2010/feb/25/markets-pressure-greece-cut-spending https://www.theguardian.com/business/2010/feb/25/markets-pre... [2] https://www.theguardian.com/business/2010/apr/18/goldman-sachs-regulators-civil-charges https://www.theguardian.com/business/2010/apr/18/goldman-sac... ( Now we know the truth. The financial meltdown wasn't a mistake – it was a con ) PS: I wonder what happened to the perpetrators of the 2008 crisis.
therealdkz 2y ago
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Using the same currency makes it easier to figure out what you’re paying and spot if you’re getting ripped off on holidays. For example: €100 EUR = 41,172.31 HUF (Hungarian Forint)

input_sh 2y ago

Technically, the whole country could just switch to Euros without even being in the EU. Granted, the only two countries to do so (Montenegro and Kosovo) never bothered with creating their own currency to begin with, they went straight to Euros post-independence (with some disgruntlement from the EU). And then there's also two (Bulgaria and Bosnia) which are technically not using Euros, but their currencies are pegged to Euros and stupidly simple to convert (1 EUR = 1.95583 BAM/BGN, so just multiply/divide by 2).

madars 2y ago
Denmark is also in ERM II and 1 EUR ~ 7.46 DKK with a very tight band https://en.wikipedia.org/wiki/European_Exchange_Rate_Mechanism?useskin=monobook https://en.wikipedia.org/wiki/European_Exchange_Rate_Mechani...
jefftk 2y ago
I wonder why they pegged at 1.96 instead of 2?
- _Microft 2y ago
  They had pegged their currency to the DM (Deutsche Mark) and 1.95583:1 is still exactly the same exchange rate as when DM were converted to Euro.
gottorf 2y ago
> 1 EUR = 1.95583 BAM/BGN, so just multiply/divide by 2 Why didn't they just set the peg to 2?
- wolpoli 2y ago
  Likely to make it simple for retailers to accept euro. Making it exactly two means the retailers would lose money on the exchange spread. Another example is with 1 hkd = 0.97 mop.
  - xxs 2y ago
    That's a proper speculation, not very much grounded in the reality. Also the Euro is not accepted to this day in retail in Bulgaria.
- xxs 2y ago
  B/c the conversion to Euro happened later. It was already fixed after the hyper inflation in 1997. The initital rate was 1000 levs = 1 DM, in 1999 there was a denomination of 1000 : 1, same year the Euro happened and the Deutsche mark enjoyed the same rate to the Euro.
deleted 2y ago
[deleted]

graemep 2y ago

Using the same currency without a common fiscal policy and resources is a disaster. It means currency and interests rates cannot be tuned to each country's economy. It means governments cannot borrow in their own currency (which is cheapest). There is a reason almost all countries have their own currency. The hope was that the single currency would be soon followed by political union. Without this the Euro has been a disaster, leading to the European debt crisis, and painful austerity as the price of bailout.

richjdsmith 2y ago
Couldn't agree more. Greece is a great example of what happens to a country when they have a sovereign debt crisis and no control over the value of their currency. The ability to control your overnight bank rates, and your monetary supply is important. I don't think the convenience of easy travel or easy(ier) trading of goods outweighs it at all.
- apeescape 2y ago
  Greece cheated their way into EUR. They didn't meet the requirements, so they cooked the numbers with the help of GS. This later on blew up into everybody's faces (well, everyone except GS's).
- addicted 2y ago
  Greece showed the flaws with the EU. The good thing is that the EU has improved since then. On the flip side, Greece is also a great example of how powerful the EU can be. Greece would have absolutely collapsed outside the EU. So even with the limitations on the EU, Greece did a lot better within the EU than it would have outside.
  - drtgh 2y ago
    > The good thing is that the EU has improved since then It was indeed a big backdoor attack to the Euro, exploited by GS [1], at least. > Greece would have absolutely collapsed outside the EU. Meat for the IMF, BlackRock and so on; Argentina's twin. Global economy seems to be an ocean with Orca whales, they hit and eat alongside with sharks. The citizens turns to meat at same moment their politicians betray them [2], whether caused by ignorance or by malice (corruption). [1] https://www.theguardian.com/business/2010/feb/25/markets-pressure-greece-cut-spending https://www.theguardian.com/business/2010/feb/25/markets-pre... [2] https://www.theguardian.com/business/2010/apr/18/goldman-sachs-regulators-civil-charges https://www.theguardian.com/business/2010/apr/18/goldman-sac... ( Now we know the truth. The financial meltdown wasn't a mistake – it was a con ) PS: I wonder what happened to the perpetrators of the 2008 crisis.

therealdkz 2y ago

[dead]