Austerity Follies – Coming Soon to a Theater Near You

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If you have been watching Europe over the last year or two (or have been reading my blog), you know that there is a slow motion car crash happening over there.  As I have written about previously, the European Union is caught in an apparently unreconcilable conflict between Germany’s fear of inflation and a need to rationalize government spending and investment in a more flexible manner.  I am afraid that a breakup of the Euro is looking more and more likely, and in light of the path that Europe is on right now it could be argued that the sooner the better.  The similarities to early 1930s economic history with today’s Euro substituting for gold as the main protagonist are troubling.  Unless Germany dramatically changes its position and willingness to support monetary expansion in the EU, it is likely that a number of EU nations will be forced to take back their right to issue currency or fall ever deeper into a deflationary spiral.

Before I go on to the main point of this blog posting, I do want to emphasize that the breakup of the…

Read entire blog post from May 9, 2012.

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