The European monopoly “central” bank believes the European Union should not allow Estonia to adopt the Euro because of Estonia’s high inflation rate. When Estonia adopts the Euro, Estonia will no longer be able to generate inflation. Only the European monopoly bank will be able to generate inflation (monetary confiscation) by creating more Euros.
Perhaps European monopoly bank believes Estonia has resorted to monetary confiscation in the past to balance its budget. Like Greece, without the ability to tax people via creating more fiat tokens, Estonia will struggle to maintain high government spending.
The central bank, which has bought government bonds and taken other unprecedented measures in recent days to defend the euro from the fallout of Greece’s debt, offered a more negative assessment of Estonia’s qualifications. While Estonia is well within the limits on government spending and debt, it has a history of high inflation that raises concerns, the central bank said in an unusually blunt report.
â€œMaintaining low inflation rates in Estonia will be very challenging,â€ it added. Price stability is one of the main criteria for admission to the euro zone.
Maintaining low monetary confiscation (inflation) will only be a challenge for the European monopoly (central) bank. Furthermore, the monopoly bank does not strive for price stability, insofar as stability means staying the same. The main purpose of creating a supra-national monopoly bank is to steal purchasing power from holders of the bank’s tokens. The monopoly bank creates more tokens and this reduces the value of existing tokens, leading to higher prices based on those tokens, which is not stability.
Read a related New York Times article.