20 Years of the Euro. As we head into 2019, the Euro marked its twentieth anniversary. In the years leading up to the launch of the single European currency there was a tremendous amount of optimism and pride on the Continent based on the potential advantages a unified Europe offered — a population, economy and market that could rival and surpass the United States. While those advantages are still true, the original fiscal requirements of the Maastricht Treaty, which harmonized national budget and debt ratios and allowed for the creation of the Euro, are now the root cause of currency and capital market volatility. Those fiscal constraints have become burdensome for the peripheral European nations that historically have had less fiscal discipline than northern countries. Over the past decade in particular, there have been a series of Euro-related crises that, in our opinion, will persist until Brussels relaxes these constraints. Unfortunately, that would likely only provide temporary relief to the long-term structural issues that persist.
