THE DAILY TELEGRAPH: France and Germany will never turn their backs on the euro, French President Nicolas Sarkozy has said in his most robust defence of the troubled single currency to date.Addressing the World Economic Forum in Davos, he told speculators to be prepared for big losses if they bet against the euro. “[Germany’s] Chancellor Merkel and myself will never – do you hear me, never – let the euro fall,” he said.
“The euro is Europe. And Europe spells 60 years of peace. Therefore we will never let the euro go or be destroyed… To those who bet against the euro, watch out for your money because we are fully determined to defend the euro.”
President Sarkozy’s intervention comes with the single currency under greater strain than at any time in its short history. Davos has been abuzz with talk of a two-speed Europe, with billionaire investor George Soros warning that the “euro could possibly fall apart” under the strain.
Greece and Ireland are implementing painful pay cuts and other deflationary measures because they can not devalue, while Germany powers ahead. Ken Rogoff, the Harvard economist, has suggested Greece should be allowed to fail in an orderly fashion because its debts are insurmountable.
However, President Sarkozy said: “To imagine that we might pull out shows a complete misunderstanding of the European psychology. It has to do with our identities as Europeans.” >>> Philip Aldrick, Economics Editor, in Davos | Thursday, January 27, 2011
