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Wednesday, 3 May 2017


Whether France could successfully leave the EUROZONE and the EURO, is THE problem that Marine Le Pen, Leader of the National Front (FN), has failed to explain to electors !

Clearly, everything is possible, but HOW and at what COST, are the explanations which at present are lacking.

Again, very, very simply, as soon as France leaves the EURO and adopts the FRANC as its currency, all the Receivables and Payables (long term or short term) in the National Accounts and also in French Company Accounts, will become "foreign" currency balances (just like any other US dollar items) to be liquidated in that foreign currency, i.e. the EURO !

To protect the FRANC and to dissuade international  speculation, the parity of the FRANC must be pegged to the EURO for at least a year !   This would permit the liquidation of current foreign balances.  BUT, even then the National Bank of France will register exchange losses (and also profits) when protecting the FRANC.

Such an operation, adopting the FRANC, must be done secretly to avoid speculation on Financial Markets !  It cannot await the publication of the Result of Electors after a Referendum !

Likewise, the Costs of this Operation are difficult to determine.   Again, France leaving not only the EURO but the EUROZONE, will also entail costs !

The benefit of "depreciating" the FRANC to reduce production costs in French Industries, to make France more competitive, cannot be envisaged immediately. 

Does this not also explain that calculating the cost of adopting the FRANC, will need time, even for practicing professionals ?