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2018-06-20

Prolonged recessions are a feature /of EMU/, not a bug.

Part of the adjustment mechanism built into the currency union is the pro-cyclical impact of monetary policy: 

real interest rates are higher in countries forced through internal devaluations.
The mechanism of adjustment in the eurozone is therefore essentially that of the 19th-century gold standard. 

Prolonged recessions are a feature, not a bug.

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