"The possible effect of the collapse of the Euro on ex-pats living in Spain

Is there such a beast as an expert on the state of the Euro and the Eurozone? Every day another expert arrives on the TV screen to warble his or her expertise as to what is really going on in the turbulent world of inte
ational finance. I am not an expert but I am worried by what is going on.

At the time of writing we were being told by some that David Cameron had stood up to Europe and shown the British pound would not be sold short even if it meant standing alone against every other country in the European Union. We were shown Sarkozy snubbing poor David as they trod the boards in Brussels. In a speech on December 1st, Mr Sarkozy was expected to try to calm the panic, and to persuade voters that surrendering budgetary powers would be beneficial. All the leaders met for a delicious lunch with the usual trimmings. They all sort of agreed to the new demands of Germany and France for austerity measures and it seems the Brits stood alone in defiance. Was David being truculent or would he prove to be the knight in shining armour?

A lot of the problem would appear to be the jostling of politicians everywhere as they try to build names for themselves in their respective arenas. They are all playing in their own political ball park but must bring their alleged political skills to the table and play with other European leaders. It's a bit like football really. There might well be brilliant economists working within weaker economies. However, who really knows as the whole sorry mess has become a labyrinth of jargon and economic mumbo jumbo which takes everyone away from the real focus of lending and borrowing money.

The City of Westminster makes most of its money in the money markets and I think that is why David Cameron wanted to keep Britain out of any group agreement. The inte
et informs me that a Daily Mail article from June 2007 quoted Sunday Times Rich List compiler Philip Beresford, who had valued the Conservative Leader for the first time, as saying: "I put the combined family wealth of David and Samantha Cameron at £30 million plus. Both sides of the family are extremely wealthy. If I had that sort of money to worry about I would not want Brussels to take command of my cash. Most of us don't have this kind of money to worry about. Most of us do not really totally understand how Governments can borrow such huge amounts of money without being able to manage the implications of their actions. Most of us don't really know enough about the inner workings of the Eurozone and what all these Monopoly Money figures really imply. We do understand that money borrowed normally must be repaid. We all realise that money borrowed brings a price that has to be paid for the loan. We all should know that if we spend more than we earn we will end up in debt.

I remember from my Economics A level studies that the UK was bankrupt around 1969 and the problems stemmed from the Balance of Payments difficulties between exports and imports. Britain went to the Inte
ational Monetary Fund in the early and mid 70s and had to borrow heavily to get out of the mess. Denis Healey had to go cap in hand and borrow the money so please don't throw our hands up in horror and act as though Greece is doing something that would never have happened in the UK.

The current problem would seem to stem from the fact that country after country seems to be having the same problems and credit ratings are now causing conce
in even the stronger economies like France and Germany. If we can all accept that credit is the real problem then can't we all see that austerity measures must be put in place and borrowing must be brought under control. But the Eurozone was set up to bring inflation under control and there were supposed to be strict conditions for countries to qualify for membership. Why weren't these criteria carefully monitored and scrutinised in the early stages of this crisis? As a last resort maybe countries will return to their original currency.

Here in Spain, expats are always talking about the exchange rates. Every time money changes between pound sterling and euro a number of people begin to make money. If it has been to buy a house then there is a huge difference between commissions on 250, 000 pounds exchanged at 1.68 where we first exchanged and the current figures around 1.13 and even a parity which has almost occurred several times.

For those of us who have planned to live here we should, by now, have converted to live and think in Euros. Until now we have had an exchange rate in our favour which in our case has fallen from 1.68 to around 1.13. If the euro does collapse then we will lose the advantage of our pound being worth a bit more. As it has been falling in value for several years now those paying mortgages have begun to feel the pinch. As prices in Spain have risen then we have been paying more for everything from petrol to food and everything else in between. When we first came to Spain 20 pounds sterling would fill the tank of our Scenic Megane. For the first few years we found twenty euro would almost fill the tank but now it won't fill half the tank. We have found prices in the shops have been steadily rising but our friends who come over to spend the winter have been quite surprised that food prices have begun to swing again in our favour. It is a bit cheaper to live here.

The fact of the matter is inte
ational trade is now hyper-involved within each part of the Eurozone. We will all suffer if the Euro falls but I doubt if it will be the end of the world. It will be mightily inconvenient but I could see countries dropping away from the Eurozone especially if their own economies are not performing as well as the guidelines. The economically stronger countries will probably guide the process and the weaker countries might drop back to their own currencies. This will be a nightmare to organise but rest assured there will be those who will make money.

Please remember the whole sorry mess is cause by greed and gambling on a huge inte
ational scale. All this borrowing and lending money around the globe has become a poker game and is tied up with the unfai
ess and injustice in the world. As people are becoming better educated then they realise how we are all being kidded by the upper strata who abuse their privileges. They can see through the inequalities and hence we are witnessing countries in turmoil. Marx and Engels predicted that Capitalism would defeat itself and the only way I can see out of this mess is a greater willingness by world leaders to see a more equal distribution of wealth. Whether it is in Euros or Pounds is really immaterial. Treat people more as you would want to be treated yourself. Politicians have been found with their hands in the till. Bankers have been caught in the tills. Footballers must get real and there must be a greater commitment to treating people more equally and more fairly. Don't isolate your thoughts to expats living in Spain. We are all in this mess together and if you have nothing to lose you will resent those who are dominating the wealth in your own particular environment.

We need to revisit such maxims as a Fair Day's work for a Fair Day's pay. We need to get a grip on gambling and speculating and we need to get a grip on credit. Expats living here in Spain have the same prices in the shops as Spaniards living in Spain. I believe the shift is from West to East. As the Chinese economy has strengthened the dollar has weakened. The dollar has traditionally backed debt. When the USA has to pay more for its fuel I think we will see more problems. I read recently there was a stoppage in production of oil which has still to work its way through the world systems. This will lead to more problems next year. One possible answer will be to suspend trading on the World Money Markets for a period of time.........Please remember I am not an expert but I do read a lot and try to follow things intelligently. The more I read and the more I see I remember the maxim ´Money is at the root of all Evil' I know I haven't really answered this question. I believe nobody can. Only time will provide the answer. We are led to believe the markets are inanimate. They aren't. They are composed of people trying to make a quick buck!