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Zdeněk Tůma Economics and Inflation in Europe

On Tuesday 8 June, a very interesting evening was held, the guest in the club was the former Governor of the CNB, Zdeněk Tůma. Many topics were discussed – the sustainability of inflation, the consumer basket, the level of the national debt, and even whether or not it is appropriate and why to adopt the Euro. Anyway, it was interesting to look at the matter apolitically through the eyes of an economist. At one point, Mr Tuma made sure: and are you asking me as a central banker, an economist or a citizen? From the point of view of adopting the euro, the answer may be different. The central bank has certain options when it operates with the koruna. An economist, and perhaps the central bank, will confirm that the performance of the economy can be calculated in both the koruna and the euro. It is about performance, not the currency used. However, by comparison, exports, it is easier to have the same currency and likewise, the cost of repaying the national debt will be cheaper in the Euro than in the Koruna. Simply, the Czech economy is small and the riskiness for investors who borrow is higher in the koruna than if we had the Euro. Slovakia, for example, also got cheaper financing immediately after the Euro was announced. The Eurozone is simply more interesting and safer for investors. It also seems to be beneficial for the citizen – however, experience shows that the valuation of labour is not determined by the Euro, but by the productivity we achieve. Even countries with the same euro have different salaries…

If you want to watch the lecture, you can find it on the Venture Club youtube channel. It includes a short mention of Zdeněk Tůma’s current activity, IRQ real estate funds.

IRQ funds represent an interesting option for investment in real estate development and real estate, with a target of 8% even for smaller investments. We are preparing to open a club fund investing in IRQ. It is not possible to have everything in venture projects, so adding something more conservative to an investor’s portfolio is an interesting option.

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