More than a euro crisis

[CHIMO]

France threatens to leave the euro. German savers hoard gold. The Bundesbank works on a plan B to restore the Deutsche Mark. It's fair to say even a $1 trillion bailout hasn't been enough to stop the rumour mill dogging the European single currency this week.

How much truth there is to these rumours we'll probably never know. The Elysée was predictably playing down reports of Nicolas Sarkozy's threat yesterday. A spike in gold prices to more than ¤1,000 an ounce can only be partly due to Germans buying gold coins, and if the Bundesbank does have a plan B, it won't be telling the blogosphere first.

But, for once, the conspiracy theorists may not be entirely off beam. The trouble with Europe's debt crisis is the same as the debt crisis everywhere: it just won't go away. And until it does, the future of the euro remains as uncertain as the rest of the global financial system.

The Europe Union has responded to member states like Greece that can't afford to pay their debts in the same way world leaders responded to a crisis among bankrupt banks – by lending them more money. It doesn't take a financial genius to work out that this can only ever buy time.
http://www.guardian.co.uk/commentisfree/2010/may/14/euro-crisis-sarkozy-threat-bundesbank

[customerserviceguy]

1. This thing is the next shoe to drop

I really don't see any way out of it, and the coming economic shock won't be easily attributed to Bushco.

[RM33]

2. If the EuroZone goes

Before he died, Milton Friedman said that the Euro will not survive it's first recession.


It's looking more and more that this is the truth. I have read that if the Euro goes, the EU countries will suffer a major recession. This will affect the US because we will not be able to export to Europe. Which means a deeper recession in the US.