Sarkozy’s Convergence

The countries sharing the currency must prepare their budgets in common, narrow competitiveness gaps and face tougher automatic penalties for fiscal rule-breaking, Sarkozy said. “There can’t be a single currency without economies heading toward more convergence,” Sarkozy told 5,000 supporters in a 50-minute speech in the Mediterranean port. “If living standards, productivity, UGG Boots Outlet and competitiveness gaps widen among euro-zone countries, the euro will sooner rather than later be too strong for some and too weak for others, and the euro zone will explode.” ECB President Mario Draghi signaled yesterday that the central bank could do more to fight the crisis in return for closer fiscal union. “The sequencing matters,” Draghi told the European Parliament in Brussels. “It is first and foremost important to get a commonly shared fiscal compact right.”