ABSTRACT
The consensus about exchange rate stability, which forms the core of all arguments for EMU, has roots far back in history. The experiences of the two world wars made political decision-makers and many others sensitive to the downsides of exchange rate flexibility. These insights led to the different attempts at monetary stabilization of the Bretton Woods System, the Snake, and the EMS. This chapter outlines the global strategic view shared by Helmut Schmidt and Giscard d’Estaing, the two men who founded the EMS, and subsequently sought to develop it into EMU. Seeing a window of opportunity in 1986, Giscard and Schmidt founded two NGOs, assembling prominent members of the European business and political elite, the CMUE and one year later the AMUE. Although, given the different background of historic experience, different actors reached different conclusions about the ‘right’ monetary order, a consensus around some ideas started to emerge.
