A "flexible euro" would be the best way out of the financial crisis in the euro area, Nobel Prize–winning economist Joseph Stiglitz thinks.
It would be a system of different currencies with one name and with exchange rates fluctuating in a limited range.
A flexible euro could help countries develop a system of their own euros. Their value would vary insignificantly within the limits specified by the eurozone regulators. Mr Stiglitz believes that could result in the adoption of the single currency in future. According to him, independent currencies would have one advantage – a possibility to devalue.
New currencies’ exchange rates would fluctuate within the limits set by the euro area’s authorities. In this case, it would either be the accounting exchange rate or minor restrictions. This would help maintain some semblance of unity, Joseph Stiglitz believes.
