Sorry but I am not in Euroland. Interesting you feel out of it in Appalachia. I have been watching on CNBC, and Bloomberg's plus CNN, Sky and BBC. Does personal contact with others, matter any more?
Day two, there is no euphoria but an impression of tactical prudence plus strategic confidence. Yesterday was almost as big a test of London as the major world centre for foreign exchange dealings, as it was of the Euro. All the major computerised procedures have gone off without a major hitch.
This is in itself really interesting for socialist ideas about a managed economy. It is possible to manage something on this scale without acentralised command economy, rather a vast network of computers.
Even more important the sort of civil society that has emerged has been handled as smoothly as the computer link ups. This too is the result of rapid technological change. The major finance houses compete to contribute personable economists who give opinions on the new media about what is happening and how the central banks should adjust interest rates.
This is all very subtle now. On a day when the Yen has hit a 19 month high against the dollar, Rubin has allowed an interview about the Euro to end with a throw away line, after welcoming the Euro, by saying that sound financial policies will remain important in the US. It is also suggested this morning that the US would prevent the Euro getting too strong. (Who put this story out and why? - we come down to this level of detail in sussing out the fundamentals).
It is now assumed that any really big losses over the Euro will be from human error - a trader having a brain storm and thinking he is dealing in dollar cents rather than euro cents,. The volume still has to pick up probably for this reason.
In London the human and social perceptions are well factored in already. Virtually no one can be found arguing strongly on principle against sterling joinging the Euro. A critical letter to the Times on 1st January, excited little comment, and was significantly not from the Confederation of British Industry, but from the Institute of Directors, and from some admittedly major store houses, but which sell within Britain and have their own system of competitive international purchasing.
There is virtually a unanimous consensus in financial circles that London has defended its position shrewdly as a major financial player, but that probably as the months move on the advantages of the Euro will exert their pull. Few will say anything too critical of Hague's little England Conservative Party, which might be socially embarrassing, so the mode comment is that the time is not right, but two years time could look different.
This is not just a mere procrastination. There are immediate helpful prospects of a slight pound devaluation relative to the Euro, of around 5%, which is also helpful for the longer term for unification if it settles at around the equivalent of 2.50 DM. Meanwhile there is already a cycle of speculation that the other EMU currencies that stayed out, will be reviewing their position sooner rather than later. There is speculation about another referendum in Denmark and Sweden within two years. And Greece, which stayed out on convergence grounds, has continued to show strength in capitalist terms with major appreciations on its stock exchange in 1998, which have been maintained on the assumption that it too is likely to join within two years.
In Britain yesterday middle rank government ministers were welcoming the arrival of the Euro in an upbeat manner and have run into no effective flak from the Conservative Party for doing so.
The stage of perceptions is therefore set for a timetable for technical discussions not about whether sterling joins the Euro. Only when. Meanwhile there are many structures for equilibrating other relevant matters - unification of the stock exchanges (which now form a market of 10 trillion dollars) and the important financial services sub-committee of the European Central Bank, *on which Britain sits*. Meanwhile the debate has already been joined on taxation differences which become relevant if the interest rate is made uniform across Euroland and are now perhaps the crucial issue.
No euphoria. More impressively, prudent confidence. A major, major shift in the co-ordination and centralisation of global capital, in conformity with a civil society, dominated by the capitalists but open to informed working people.
Chris Burford
London.