Joseph Eugene Stiglitz, an American economist and a recipient of the Nobel Prize in 2001, is sure that the wave of harsh economic policies may lead to another recession and do harm to the single currency of Europe. Many countries, he says, are today prematurely cutting their budgetary spending. This will decrease demand and growth rates, which may cause another recession.

Joseph Eugene Stiglitz expressed his thoughts in the interview to The Sunday Telegraph. The USA may have caused the first recession which is now over, but Europe may lead to another – he says. The main “enemies” of the global economy here are Spain and Greece. The level of unemployment in Spain has reached 20%, and some analysts even predict that it may spread onto Greece as well. This all puts pressure on the single currency of Europe. Indeed, perspectives are weak. Maybe those countries should just abandon the idea of single currency in the EU, because the experiment is now going wrong. Stiglitz doesn’t think it is worth unemployment and suffering of people.

There is one solution, however. Stiglitz thinks it is possible for Germany to leave the eurozone, hitting two targets at once. This will drop the exchange rate of euro, which will not only help European exporters (whose production costs will decrease), but will also increase demand for European goods as well.