Empire of Dunces

Neoreaction

The Euro

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It has been pointed out to me that I may be giving the wrong impression as to what exactly is going to happen at the markets. So, for the purposes of clarification, I give you my two cents about the future of the Euro.

As much as I have always been opposed to the Euro, even before the initial establishment, and as much as I would love nothing better, than for the German politicians to finally grow a pair and leave the damn thing, I simply do not see it happening, short of bloody riots in the streets. And like I said before, Germans don’t riot. Germany withdrawing would of course mean the end of the Euro, but it just won’t happen. The far more likely scenario is that things will continue as they have for a while longer, with more shocks to the system from Spain, Portugal, Italy and Ireland. At some point, one or more of those countries will leave the Euro, or even be evicted, because there is simply not enough money to go around to cover everybody’s debt. The eventual end result, will be a two-tiered currency, or maybe just a ‘Northern’ Euro, encompassing Germany, France, the Benelux and Finland. Such a currency would have a chance of survival at least. The other alternative – printing enough money to cover all the debt – would entail massive inflation. And considering German experience, I think that would just about be the breaking point, even for our gutless politicians. Either way, in my opinion, all this talk lately of the end of the Euro is more than a bit premature. And also unrealistic. Our elites have too much invested in this insanity to take the sensible route and actually do what is right for their own people – you know, the schmucks that they supposedly swore an oath to represent, i.e. you and me. They will dance as close to the precipice as they can to prevent their wet dreams of a European empire from collapsing. The best we can hope for, is that that they won’t try to jump the precipice, not too strain the metaphor.

But, just for the record, I do not have a crystal ball, and I simply do not know what exactly will happen. It is undeniable, that the current system is unsustainable. What will follow is uncertain. The above is my best guess, and nothing more. As for the consequences YOU should draw from this? As I have stated repeatedly before – hard assets, selected real estate, and resource currencies. Sounds unexciting maybe, but before too long you are going to be grateful for a little less excitement. Brazil, Norway, Australia, Canada – your best sources for decent currencies. Brazil also for real estate.

We will talk more soon.

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Written by gloege

May 28, 2010 at 00:55

Posted in Uncategorized

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