I'm sure everyone watched oil boil higher today-- Almost up 10%. The inflation straw that will break the oil dependant camel lover's back is getting closer to melting down any US recovery, but the real story of the weekend was that Europe is borrowing truckloads of money again... Europe Borrows Massive Emergency Cash
I love the fat finger explanation from the financial porn site CNBC.
In my opinion, however: Someone is trying to kill the Euro.
I'm pretty sure it is the EU, by means of a Euro suicide.
To solve a murder you need (a) physical evidence, (b) a crime scene and (c) a murder weapon.
To kill the Euro, the evidence will be the uncontrollable and never ending EU buying of failing bonds from bankrupt countries like Portugal and Spain. Germany, the killer, will also be the crime scene where the currency dies, and the Euro itself is being used as the murder weapon.
The Euro killing the Euro with the Euro: One Euro at a time.
I have always wondered why the Euro gets to be the elitist fiat currency to the dollar. Would you really stand behind Europe vs. the dollar in a 'Who's the toughest fiat currency' death match?
What a pathetic match that would be-- In this corner the dollar, backed by the Wizard Ben Bernanke, throwing bloated state pensions and buckets of 'gauranteed' T-bills and mortgages into the ring with an IOU note that reads, 'Consumers and tax payers to pay back
Let's get ready to
I bet the dollar and the Euro would just see how much the other wanted to be paid off from some central bank, instead of fighting.
Dollar would win that one...
In my opinion, the Euro shouldn't have any premium to the US Dollar. Not now. Maybe in the future (if it makes it) and maybe in the past. But maybe never.
Both currencies are debt traps that will never be able to pay back the quanitiative easing (uhhh... money printing with no backing), but the dollar has one thing going for it-- there is only one country that stands behind the dollar. The Euro is a bunch of countries with different banks, economies and different politics. It just doesn't make sense. I just can't understand how Germany and Ireland share the same currency.
Sure, someone like Portugal benefits from the Euro. Instead of the Portuguese bond yields screaming to 15%, the EU jumps in and keeps the rates down. Sound like the US? Yes and No. Yes, the US is buying its own debt, but NO because the US is not competing within itself by damaging the financial reputations of 'stronger' nations like Germany, England and France.
I don't see why Germany stays with the Euro disaster-- for Germany it doesn't make sense to support bottom feeders like Portugal and Greece.
Will Germany be the first to secede from the Euro? Will there be some hybrid currencies created. ie. a strong Euro and weak Euro (we have that here -- the weak currency is called the Peso). Maybe Portugal realizes that it is pulling down the other countries and nicely pulls out, resulting is a complete meltdown of their economy and rampant hyperinflation when they reintroduce Escudos at 10,000 to 1 Euro. Maybe-- and maybe North Korea sends flowers to the US on July 4th.
The Euro is dying-- The Euro sucks as an idea. It is a worse idea than the Bacon Genie-- Bacon Genie
I'm not saying the dollar is a great in comparison, but the Euro is being killed... by the Euro.
The Dollar can't kill the Dollar-- it will only multiply if you feed it after midnight.
When the Euro has been murdered it will never come back... Ever.