I have seen some unconfirmed reports or rumors where EU member states as Ireland and Germany have been re-issuing their native currencies prior to joining the EU, particularly the Irish pound and the German deutschmark
From Moneynews.com
Ireland's central bank reportedly is printing Ireland's old currency in case the country leaves the eurozone. At least that's the rumor circulating in Dublin, notes Alan McQuaid, chief economist at Bloxham stockbrokers in that city.
McQuaid, writing a guest commentary for The Guardian, says he's not sure if the rumor is true. But he does hope Ireland has contingency plans in case the euro disintegrates.
Then again, given the record of European leaders, a lack of backup plan wouldn’t be surprising.
As Greece struggles to remain solvent, the European monetary union is scrambling to stop the debt crisis from spreading. If the crisis does spread, Ireland might be next in line.Some pundits say Ireland should drop the euro.
Being master of your own destiny does have appeal, McQuaid admits. If it returned to the punt, Ireland could boost exports by devaluing the currency and reduce its debt burden.
Also, a known political insider Philippa Malmgren, special assistant to Special Assistant to the President for Economic Policy on the National Economic Council for ex-President Bush and was also a member of the President's Working Group on Financial Markets, aka, the Plunge Protection Team, at Sweden's largest business paper, Dagens Industri says that she expects Germans to return to the Deutschemark and have already ordered its re-issuance (hat tip: Bob Wenzel)
Germany refuses more emergency loans and prepares the reintroduction of the D-mark. They have already ordered the new currency and excites the printers to rush. It says the U.S. economy Doctor Philippa Malmgren.
"My impression is that the German Government sent us a number of signals that, from their perspective there is no other solution (than to leave the euro)," writes Philippa Malmgren, formerly an advisor to former U.S. President George W. Bush and global strategy director the banking giant UBS in his blog.
The validity of these reports are unclear.
Nevertheless, when markets are usually exhibiting signs of depression as this, they could signal a bounce or an important inflection point.
Otherwise if these reports are true, then a realization of Euro’s disintegration would likely mean intensely turbulent times for the financial markets—as the “newly” independent European central banks would likely embark on saving their respective national banking system by printing tsunami of money to counter waves of deflationary defaults.
In this case, we should expect even more massive gyrations both on the upside and downside that could make hearts palpitate rapidly.
Fasten your seat-belts.
