Goal of your research: find a comparative question to ask and then answer with comparative data (and econ analyses) for the UK and Spain. Don’t fall into the trap of discussing the UK and Spain separately, even if one country may seem more interesting. Each major point you make must be a compare and contrast type of thing (my standard guideline is 1 comparative hypothesis/question, 3 comparative explanations/answers).
Write a research on how the much smaller country, relatively speaking, Spain was able to meet the EMU’s requirement, but the UK powerhouse had utterly failed this task. Leaving one of the strongest currencies at the back of the pack in value.
The morning of September 16th, 1992 would hold an incredible weight as the UK’s previous monetary and fiscal policies would imminently prove to be failed; this day would later be referred to as Black Wednesday. An imminent pressure only foreseen by few, one of which being a prominent name in our own American politics; a German man, none other than George Soros. In the chaos of this morning, interest rates rose to more than 12%; this being only one of the reactionary measures taken by the Prime Minister John Major to save his country’s financial well being. Taking the original stipulations set by the Exchange Rate Mechanism into mind, raising interest rates would slow private spending/ investment and in hopes limit the impact of this event. Years later it would be realized that over 13 billion had been the price paid for poor monetary and fiscal policy resulting in this economic catastrophe. Countries within the EMU “Band” had stipulations to “maintain the currency values relative to each other”, in order to maintain solidarity and keep forigen investment and the sterling strong. One of the EMU’s rules for continued admittance was that countries with the most valuable currencies had to sell their own and buy the weakest. In the month following this economic turning point the deutschmark was the most powerful currency and sterling the weakest within its band.
My research will show how the much smaller country, relatively speaking, Spain was able to meet the EMU’s requirement, but the UK powerhouse had utterly failed this task. Leaving one of the strongest currencies at the back of the pack in value.
Use these for information:
https://www.investopedia.com/ask/answers/08/george-soros-bank-of-england.asp
https://www.theguardian.com/business/2012/sep/13/black-wednesday-20-years-pound-erm
https://vantagepointtrading.com/black-wednesday-documentary-on1992-british-pound-gbp-crash/
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