What is Eurozone crisis?
{{more sources|date=June 2023}} The '''Eurozone crisis''' also known as the '''European debt crisis''', was a multi-year debt crisis that happened in the [[European Union]]. The crisis happened due to a [[currency crisis]], which is a stop of the flow from foreign capital into countries that were dependent on foreign lending. The crisis became worse because the countries could not [[Devaluation|devalue]] the currency (reduction of the currencies value) due to the [[Euro]] being a shared currency.<ref>{{Cite journal|last=Copelovitch|first=Mark|last2=Frieden|first2=Jeffry|last3=Walter|first3=Stefanie|date=2016|title=The Political Economy of the Euro Crisis|url=https://dash.harvard.edu/handle/1/33694190|journal=Comparative Political Studies|language=en-US|doi=10.1177/0010414016633227|issn=0010-4140}}</ref><ref>{{Cite journal|last=Frieden|first=Jeffry|last2=Walter|first2=Stefanie|date=2017|title=Understanding the Political Economy of the Eurozone Crisis|url=https://dash.harvard.edu/handle/1/33459439|journal=Annual Review of Political Science|language=en-US|doi=10.1146/annurev-polisci-051215-023101|issn=1094-2939}}</ref> == Controversies == === EU treaty violations === The EU's [[Maastricht Treaty]] contains information that forbids that partner countries bail out another partner country, mainly to stop the spreading of public debt. The clause is designed to encourage good [[Fiscal policy|fiscal policies]]. The [[European Central Bank]]'s purchase of country bonds can be viewed as violating the part of the treaty forbidding the financing of budget [[Deficit spending|deficits]]. == References == {{reflist}} [[Category:Economic history]] [[Category:European Union]]