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Thursday, March 21, 2013

Euro Doomed

The Euro was doomed to fail the instant it was created.
It is not a true fiat currency.  A true fiat currency can be printed, at will, for whatever reason.  Need more cash, just issue more!

The euro requires memebers to try to keep a fiscal order.  If you have high debts, then get it under control.  The US has no such limitation.

So countries like Greece, Spain, Italy get slammed while the savers of Europe, such as Germany scream they must get their lons repaid.

The result is a currency at odds with itself.  If countries like Greece had their own currency, they would print more money - answering to no one - and continue on their merry way.  Their currency would likey trend lower vs German currency.  The local Greeks would be appeased and not rioting.  However, rest assured, german exports would be too expensive for most greeks and not buy german products.

So one side benefit of the Euro is to ensure everyone keeps currency relatively flat to each other.  This DRAMATICALLY favors the sellers and puts the debtors at great disadvantage.

Niral Firage has a nice speech about recent step being done.  Announcing to the world taking money from EVERYONE's savings as a tax, over-night, no wardning.    The message is: dont keep money in banks, keep them in mattresses.

It is stuff like this that WILL create a crisis, and assets keep value, some like gold may explode up.
People still don't get it.  Printing money doesn't cause currency problems, faith in the stability of the finance does.  And what message does it send to announce taking people who have money to pay off some of other people's debt......

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