Posted on June 12th, 2008 in Daily Stock Market / Economic News - The Real Story
A friend and market veteran Bill King just shot this off and I think the story speaks for itself. if I am not mistaken, there was nota word of this on bubblevision today other than a quick mention by ‘the man’ Santelli’ midday. Bill, himself, may come by to chat about it later. -Best, Mr Mortgage
Germans begin rejecting euros from Latin bloc
Submitted by cpowell on 07:29PM ET Thursday, June 12, 2008. Section: Daily Dispatches
By Ambrose Evans-Pritchard
The Telegraph, London
Friday, June 13, 2008
Notes printed in Berlin have more currency for bank customers who fear a “value crisis.”
Ordinary Germans have begun to reject euro bank notes with serial numbers from Italy, Spain, Greece, and Portugal, raising concerns that public support for monetary union may be waning in the eurozone’s anchor country.
Germany’s Handelsblatt newspaper says bankers have detected a curious pattern where customers are withdrawing cash directly from branches, screening the notes to determine the origin of issue. They ask for paper from the southern states to be exchanged for German notes.
Each country prints its own notes according to its economic weight, under strict guidelines from the European Central Bank in Frankfurt. The German notes have an “X” at the start of the serial numbers, showing that they come from the Bundesdruckerei in Berlin.
People clearly suspect that southern notes may lose value in a crisis, or if the eurozone breaks apart. This is what happened in the US in the Jackson era of the 1840s when dollar notes from different regions traded at different values.
“The scurrilous idea behind this is that if the eurozone should succumb to growing divergences, then it is best to cling to most stable countries,” said the Handelsblatt.
“There are no grounds for panic. The Italian state is not Bear Stearns,” it said.