Saturday, November 22, 2008

Spectator and Iain Dale snaking around the truth

Iain Dale is 'terrified, if true' by Fraser Nelson's Spectator column where he:
 "asserts serious economists now view the London financial markets as "Reykjavik on Thames""
What Iain Dale and Fraser Nelson fail to mention if that the FT article which coined the phrase, by LSE economist Willem Buiter, went on to say that:
"If Iceland had been a member of the euro area, its central bank would have been part of the Eurosystem - the euro area central bank consisting of the ECB and the (currently 15) national central banks of the euro area member states."

"As a member of the euro area, it would have been much easier and cheaper for Iceland to defend itself against speculative attacks on its banks - provided the banks and its government were indeed solvent and perceived to be so"
I wonder why two supporters of the infamously Eurosceptic Tory party, whose leader Cameron made pulling out of the European People's Party a leadership manifesto pledge, didn't mention the rest of what 'serious economists' * were saying.

Taken out of context, Buiter's remarks create the impression that he is simply accusing Labour of driving the economy to disaster rather than urging the UK to enter the Euro.

Just to ram the point home, one of Buiter's previous articles on his Maverecon blog was titled: 'When will the UK wake up and join the Euro Area?'

*NB: Why did Fraser Nelson say 'serious economists', not 'serious economist' or even 'Willem Buiter' - Does Professor Buiter have a Doppelganger?


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