Ireland is Bankrupt....a comment letter from someone from Ireland

This is a letter from someone from Ireland....I am sure there will letters, thoughts and comments from many others there like this from Ireland and then from the rest of Europe.  People are disappointed with the the lack of financial responsiblity and respect that the political and business leaders have had.  Yet the people voted for the easy way...but the easy way does not last long.  

*********


Herman Van Rompuy, President of the European Council, warned that if Ireland didn't apply for an EU/ECB/IMF bailout for its failed banking system, its soaring budget deficit and its colossal national debt, then the European single currency might collapse [the bond markets have already panicked and cashed in], and if the International markets lost confidence in the Euro, then the dissolution of the Union would quickly follow. He said the future of the Eurozone depended on stemming the tide of market distrust caused by the tanking Irish economy. He feared contagion, that Portugal and Italy and Spain would soon follow.


Ireland is not only insolvent because it has no liquidity, no way of meeting its debts. The government decided to link the economic future of the country to a failed banking system and now the two are inextricably intertwined. No amount of raised taxes can bail out the banks and still pay the day-to-day running expenses of our welfare state. The famed 'Celtic Tiger' boom economy was always a high-risk, dangerous fiction. Someone dubbed Ireland the 'Wild West of Economics'. Our illusory wealth was tied to a property bubble that was as unsustainable as it vacuous, and all the money was borrowed, primarily from German savers. We were hooked on credit like it was crack cocaine. We binged but never purged and we stayed high to postpone the inevitable hangover. Everybody was in cahoots, from corrupt local governments, driving through emergency rezoning laws, to rogue bankers financing the criminal inflation of developments and shoveling billions to builders, to newspapers cashing in on their property advertising to regulators asleep at the wheel. Our mafia don cum Taoiseach, Bertie 'Gombeen-Man' Ahern, invited critics of the system to commit suicide. Nobody left the orgy. Nobody wanted to leave. Planet Hollywood had finally come to Planet Ireland!

But inevitably the whole house of cards would come crashing down, and Bertie [who tendered his timely resignation just before the collapse] soon got his wish as the suicide rate started to climb to the highest in Europe. The government panicked. The Minister for Finance, a barrister by profession, got a crash course in national and global economics. He learned about markets and budgets and bonds and gilts on the job, on a need-to-know basis. He instituted an abstraction called N.A.M.A. http://www.nama.ie/ , The National Assets Management Agency, whose remit basically is to buy up all the debt and properties left unfinished and unpaid for by the construction moguls [developers & builders] and their bankers, to transfer them to a national trust, cue Irish tax-payer, as if we owned them, or even wanted them, or could avail of them in any way, and to pay off the outstanding loans. All over Ireland, in every town and village, are these unfinished ghost estates. These now belong and do not belong to the Irish taxpayer. This offense was compounded by the decision to bail out the very banks [like Anglo Irish and Irish Permanent, really, all of them] that got us into the mess. The banks were hemorrhaging money [and still are] and the government was on hand to provide on-the-spot triage, a botched stitch-up job if there ever was one, a cluster-fuck of cosmic proportions.

The government, Fianna Fáil in coalition with The Greens and a few independents, lied through their teeth and kept telling the Irish taxpayer that exports were up, that the revenue would come in once the austerity budget was passed, once the 4-year plan was unveiled and ratified and that no bail-out would be necessary. Reduce public spending, they told us, tighten our belts; cut the public sector; Trim this, give a haircut to that and all would be hunky dory. Well, the same shower of gangsters who gave the green light to sub-prime lenders and hedge-fund speculators-gamblers went to the ECB/IMF with cap in hand this week and begged for a bailout. Then they came on TeeVee to announce the done-deal. Ireland will borrow over 85 billion from its partners in the EU and the IMF and, depending on the repayment interest, 5 -7%, we could be paying back upwards of 4 billion a year. That's about 1/4 of the Tax intake. The debt is completely beyond our means as Constantin Gurdjiev, http://trueeconomics.blogspot.com/ and David McWilliams http://www.davidmcwilliams.ie/category/articles/ are trying to point out.

Ireland is used to erosions of its sovereignty ever since we joined the European Union. We, we had our first referendum on the Lisbon Treaty in June 2008 and it was defeated. Sarkozy told our Taoiseach that he delivered the wrong result and to go back to the people and get the right result next time, so that's exactly what happened and so in April 2009 the treaty was finally passed in Ireland. So much for Irish sovereignty. Our membership of the single currency in 1998, as part of our EU obligations under the Maastricht Treaty, further compromised that independence. Now ceding control to the IMF -- to save the Eurozone -- is the final nail in the coffin of that putative myth known as Irish sovereignty. We gave away so glibly what we fought so hard to achieve.


Was it for this the wild geese spread

The grey wing upon every tide;

For this that all that blood was shed,

For this Edward Fitzgerald died,

And Robert Emmet and Wolfe Tone,

All that delirium of the brave?

Romantic Ireland’s dead and gone,

It’s with O’Leary in the grave.

I'm afraid the verdict isn't very flattering. Ireland is indeed a banana republic, a land full of cronyism, wink and nod business deals, insider trading, nepotism, feather your own nest and forget about the next guy, take all you can as quickly as you can no matter who gets hurt, ostracize the whistle blowers and critics, advance number one every time and keep the circles closed. There's no sense of civitas here, no notion of self-sacrifice, no pride in history, culture, nation; it's all up for grabs to the highest bidder. It doesn't matter that we struggled for 800 years to achieve independence, that millions died in the process; it doesn't matter that the folk memory of harsher times is still very much alive; none of this mattered to the few generations that have dismantled our country institution by institution and thrown the Irish people to the wolves, the bean counters in the IMF who will now control our destiny. Our political system is in ruins. The people have lost all faith in their elected representatives. They feel that welfare for the wealthy, bailouts for crooked corporations and rewards instead of punishments for embezzlement and thievery is the rule of the land. And what the British and the world said about us, all the stereotypes, seem to be true after all and maybe were always true: we were never equipped to govern ourselves, we're a nation of drunks, peasants, irresponsible wasters and chancers addicted to violence and quick fixes. Our independent republic is less than a century old and already it's in smithereens -- we're in the gutter and being dictated to by the UK, Germany, France and the IMF. Mr. Ajai Chopra is our new vice-chancellor, our new Taoiseach, our new overlord and big boss and we've just been recolonized, first by our own brood of inbred gangsters and now by international bankers. We didn't deserve any better. It's our own damn fault.

By 'we' I mean the select few that got our country into the financial mess. But the blame game serves no useful purpose now: we're all screwed, not equally, mind you [but when are people ever screwed equally?], and the nation has no option now but to drive through a draconian austerity budget and then take the bailout and let our affairs be run by outsiders. Could we say 'Screw You' to the Euro and go back to the punt? Could we say 'Screw You' to Germany and all our debtors? Could we say ' Screw You' to the EU and let the Eurozone fall? Our politicians tell us we have no choice. It would be therapeutic to tell the lot of them to piss off and to return to hunter-gatherer status but how feasible is that? Kids think beef patties are really square and grow on trees. They wouldn't know how to pluck a chicken let alone sow and reap a harvest. Everything's in the grocery store and they're too busy playing play station, twittering and gabbing on Facebook to worry about the right time of year to plant a tuber. The EU is run by neo-liberalist economic policies and if Ireland doesn't play ball the multi-nationals will up and relocate to cheaper labour markets. They're already doing just that. They're encouraged to do it by Merkel and Sarkozy and Cameron.



And then there's always the fear that this crisis will inaugurate excessive nationalism, that the Provos will exploit civil unrest and lack of confidence in the government to push their demented and deranged United Ireland bollocks. Gerry Adams has already announced his candidacy for a seat in Co. Louth which, if elected, will find him in Dáil Éireann. This would be disastrous for Ireland. Ireland doesn't need Sinn Féin's brand of patriotism. People should remember Gerry Adams' devolvement announcement for the Good Friday Agreement: He said he was now ready to pursue through the political process the same agenda he failed to achieve through armed struggle, that is, a United Ireland. If Sinn Féin ever gets a foothold in Irish politics there will be a return to the rule of the gun; if his bunch of murderous, terrorist thugs are ever allowed to exploit the political vacuum in Ireland there will be a bloodbath. Adams has always preached against the EU and partnership with Britain. He's still the same dickweed that did time in Long Kesh and had Jean McConville a widowed mother of 11 children murdered because she administered last rites to a British soldier who died on her footstep. His brand of fascistic nationalism is no good for Ireland. We must reject him and what he stands for.

As a nation we're a joke, a laughing stock, and now it's time to become a colony of the IMF under the direction of the same cowboy outfit that brought peace and prosperity to Argentina and Iceland. O Joy, I just can't wait. We're used to it. It feels good. And this time we walked right into it. Heck, we can always get drunk afterwards, have a rare old session and weep and wail over our Fenian dead.

Custerluck

Mr. Crawford's letter of despair could just as easily be authored by anyone in the UK, US or France. We have all reached the point where no amount of twisting and turning is going to avoid the noose of poverty. We have all taken the easy way out, which in retrospect will become the most difficult way.

Those that survive will indeed learn to "pluck a chicken" or "reap a harvest". They will also have to learn how to grow a garden, how to preserve foodstuffs and how to repair a tire. Unfortunately, they also may have to learn how to handle a gun.

Other than the above, I have no advice except that of Margaret Thatcher's comment that socialism ends when they run out of other people's money.

Bancor: The Name Of The Global Currency That A Shocking IMF Report Is Proposing

Very interesting proposal. Amazing what man will dream up.

Think the Euro has problems, watch this one.

Bancor: The Name Of The Global Currency That A Shocking IMF Report Is Proposing

Soros Warns European Recession Is 'Almost Inevitable' Next Year

Soros Warns European Recession Is 'Almost Inevitable' Next Year

Seven Reasons to Love the Euro

Euro is oversold, due for bounce.
Seven Reasons to Love the Euro - MarketBeat - WSJ

Euro seen heading for parity with dollar | Reuters

Euro seen heading for parity with dollar | Reuters

Bets on Euro Decline at a Record on Concern Bailout May Fail - Bloomberg.com

I was thinking of shorting the Euro, waiting for the bounce up after the $1 trillion bailout. Did not expect that the bounce would only be part of a day. Everyone is wise to what is happening and the Euro continues its fall. It is falling too fast for me to put on a position. Now about $1.235....wow! Reading that the target is par with the USD. Will it have a bounce up so one can short or will it continue to slide down.

Bets on Euro Decline at a Record on Concern Bailout May Fail - Bloomberg.com

EURUSD Breaks Down, Hits 1.2572 | zero hedge

EURUSD Breaks Down, Hits 1.2572 zero hedge

FX Concepts' John Taylor: "The Economic Reality Will Eventually Destroy Greece And Europe"; Warns Of Civil War | zero hedge

FX Concepts' John Taylor: "The Economic Reality Will Eventually Destroy Greece And Europe"; Warns Of Civil War | zero hedge

Posted using ShareThis

Economy Outlook - Marc Faber: We Have a New Gold Standard - CNBC

Marc Faber recommends:

Gold
Oil
Oil companies
Mining companies
XOM
CVX
SLB

Invest - 50% of your portfolio in emerging markets

Avoid US $, US Treasuries and Euro

Economy Outlook - Marc Faber: We Have a New Gold Standard - CNBC

Posted using ShareThis

Columbia Prof Who Called Argentina Crisis: "Corruption Is The Reason Italy Will Be Next" | zero hedge

Columbia Prof Who Called Argentina Crisis: "Corruption Is The Reason Italy Will Be Next" | zero hedge

Posted using ShareThis

Euro Area Risks Breakup

By Bo Nielsen

Feb. 27 (Bloomberg) -- Hayman Advisors LP, the firm that earned $500 million betting on the U.S. subprime mortgage-market collapse, says Europe’s monetary union is about to fall apart.

Richard Howard, a managing director for global markets at Dallas-based Hayman, said Germany may opt to shore up its own economy, Europe’s biggest, rather than bail out fellow euro nations such as Austria, Italy and Spain as their banks sag under the weight of bad debts. That might lead to defaults and compel Germany to renounce the euro, he said.

“People said subprime could never blow up but it did and now they’re saying the exact same thing about the eurozone,” said Howard. “There’s no stopping what is now a downward spiral.” He declined to discuss his investments.

Hayman joins a growing number of investors seeing the possibility of a breakup of the $12 trillion euro bloc, conceived more than 10 years ago to cut unemployment, tame inflation and create a rival to the dollar. Societe Generale SA said this week Germany may refuse a bailout in an election year. ABN Amro Holding NV said Feb. 17 the crisis is “Europe’s subprime.”

Euro-region bank loans to Eastern Europe topped $1.3 trillion in the third quarter last year, or about 9 percent of the bloc’s gross domestic product, ING Groep NV said Feb. 18, citing Bank for International Settlements data. Now lenders face losses after extending credit to finance everything from industrial development to domestic real estate.

Debt-Default Insurance

Irish banks and foreign banks operating in Ireland together took on debt equivalent to 11 times the nation’s gross domestic product, Dutch-bank credit reached seven times GDP and Belgium four times, according to BNP Paribas SA.

As concern intensified that the loans won’t be repaid, the cost to insure against defaults jumped six-fold to records since August. Credit-default swaps on Ireland climbed to a record 395.8 basis points, from less than 50 basis points in September, according to CMA DataVision. Austrian swaps traded at 265 basis points, compared with less than 25 points six months ago.

The breakup may occur as investors shun all but the safest government bonds, said Hayman, which in 2006 was among the first to bet against Wall Street’s rush to securitize the debt of the least creditworthy U.S. borrowers, correctly predicting a slump in home values that sparked the global credit crisis.

Investor demand for the lowest-risk securities already drove the difference in yield, or spread, between Greek, Austrian and Spanish 10-year bonds and German bunds, Europe’s benchmark government securities, to the widest since the euro’s debut.

Steinbrueck, Soros

German Finance Minister Peer Steinbrueck said Feb. 18 euro countries would “show our ability to act” should countries face difficulties paying debt. Billionaire investor George Soros said Feb. 17 he doesn’t expect a breakup of the region.

The World Bank, the European Bank for Reconstruction and Development and the European Investment Bank will provide up to 24.5 billion euros ($31 billion) to help central and east European banks and businesses cope with the crisis.

European Central Bank officials also said solutions can be found that will ensure cohesion of the region. Executive Board Member Lorenzo Bini Smaghi said Feb. 21 that European Union rules permit the EU “as a whole” to aid states in “economic difficulty.” ECB President Jean-Claude Trichet said a day earlier “there is no weak link of the euro area.”

“The argument that the euro zone will find a solution contains some sense if the assumption is that the situation isn’t that bad,” said Howard. “But the more dire it gets, the less are the consequences of departing from the euro.”

Shrinking Economies

German GDP contracted 2.1 percent in the fourth quarter, the biggest decline since 1987, the Federal Statistics Office said on Feb. 25. The economy will shrink by 2.5 percent this year, with France contracting 1.9 percent and the euro-region 2 percent, according to an International Monetary Fund report on Jan. 28.

European governments, which committed more than 1.2 trillion euros to rescue ailing banks as the recession eroded tax revenue, will require more cash as defaults occur, Howard said. Faced with the prospect of a deepening recession, Germany and France may be reluctant to bail out euro-region members such as Spain and Italy, Howard said.

“Because of the size of this crisis and because of the linkage with Eastern Europe, I think we need to see more broad- minded thinking coming out of the big European countries, in particular Germany,” Jim O’Neill, chief economist at Goldman Sachs Group Inc., said in a Bloomberg Television interview today in London. “Germany has got to create demand for many countries in Europe that have a strong need for some help coming out of elsewhere.”

German Elections

The German government, facing elections in September, might refuse requests for help amid political pressure to spend money at home, Societe Generale said in a Feb. 24 report.

“A bailout of a debtor country from a surplus country like Germany would be like opening the box of Pandora,” former Bundesbank President Karl Otto Poehl said in London yesterday. “It’s a very dangerous course that we will enter” and “I’m very much against it, many people in Germany are against it, but the political pressure will increase,”

The Risk in Europe

Europe and the Euro are in trouble

*************************
By John Mauldin - Feb 20, 2009

I mentioned last week that European banks are at significant risk. I want to follow up on that point, as it is very important. Eastern Europe has borrowed an estimated $1.7 trillion, primarily from Western European banks. And much of Eastern Europe is already in a deep recession bordering on depression. A great deal of that $1.7 trillion is at risk, especially the portion that is in Swiss francs. It is a story that could easily be as big as the US subprime problem.

In Poland, as an example, 60% of mortgages are in Swiss francs. When times are good and currencies are stable, it is nice to have a low-interest Swiss mortgage. And as a requirement for joining the euro currency union, Poland has been required to keep its currency stable against the euro. This gave borrowers comfort that they could borrow at low interest in francs or euros, rather than at much higher local rates.

But in an echo of teaser-rate subprimes here in the US, there is a problem. Along came the synchronized global recession and large Polish current-account trade deficits, which were three times those of the US in terms of GDP, just to give us some perspective. Of course, if you are not a reserve currency this is going to bring some pressure to bear. And it did. The Polish zloty has basically dropped in half compared to the Swiss franc. That means if you are a mortgage holder, your house payment just doubled. That same story is repeated all over the Baltics and Eastern Europe.

Austrian banks have lent $289 billion (230 billion euros) to Eastern Europe. That is 70% of Austrian GDP. Much of it is in Swiss francs they borrowed from Swiss banks. Even a 10% impairment (highly optimistic) would bankrupt the Austrian financial system, says the Austrian finance minister, Joseph Proll. In the US we speak of banks that are too big to be allowed to fail. But the reality is that we could nationalize them if we needed to do so. (And for the record, I favor nationalization and swift privatization. We cannot afford a repeat of Japan's zombie banks.)

The problem is that in Europe there are many banks that are simply too big to save. The size of the banks in terms of the GDP of the country in which they are domiciled is all out of proportion. For my American readers, it would be as if the bank bailout package were in excess of $14 trillion (give or take a few trillion). In essence, there are small countries which have very large banks (relatively speaking) that have gone outside their own borders to make loans and have done so at levels of leverage which are far in excess of the most leveraged US banks. The ability of the "host" countries to nationalize their banks is simply not there. They are going to have to have help from larger countries. But as we will see below, that help is problematical.

Western European banks have been very aggressive in lending to emerging market countries worldwide. Almost 75% of an estimated $4.9 trillion of loans outstanding are to countries that are in deep recessions. Plus, according to the IMF, they are 50% more leveraged than US banks.

Today the euro rallied back to $1.26 based upon statements from German authorities that were interpreted as a potential willingness to help out non-German (in particular, Austrian) banks.

However, this more sobering note from Strategic Energy was sent to me by a reader. It nicely sums up my concerns:

"It is East Europe that is blowing up right now. Erik Berglof, EBRD's chief economist, told me the region may need €400bn in help to cover loans and prop up the credit system. Europe's governments are making matters worse. Some are pressuring their banks to pull back, undercutting subsidiaries in East Europe. Athens has ordered Greek banks to pull out of the Balkans.

"The sums needed are beyond the limits of the IMF, which has already bailed out Hungary, Ukraine, Latvia, Belarus, Iceland, and Pakistan -- and Turkey next -- and is fast exhausting its own $200bn (€155bn) reserve. We are nearing the point where the IMF may have to print money for the world, using arcane powers to issue Special Drawing Rights. Its $16bn rescue of Ukraine has unravelled. The country -- facing a 12% contraction in GDP after the collapse of steel prices -- is hurtling towards default, leaving Unicredit, Raffeisen and ING in the lurch. Pakistan wants another $7.6bn. Latvia's central bank governor has declared his economy "clinically dead" after it shrank 10.5% in the fourth quarter. Protesters have smashed the treasury and stormed parliament.

"'This is much worse than the East Asia crisis in the 1990s,' said Lars Christensen, at Danske Bank. 'There are accidents waiting to happen across the region, but the EU institutions don't have any framework for dealing with this. The day they decide not to save one of these one countries will be the trigger for a massive crisis with contagion spreading into the EU.' Europe is already in deeper trouble than the ECB or EU leaders ever expected. Germany contracted at an annual rate of 8.4% in the fourth quarter. If Deutsche Bank is correct, the economy will have shrunk by nearly 9% before the end of this year. This is the sort of level that stokes popular revolt.

"The implications are obvious. Berlin is not going to rescue Ireland, Spain, Greece and Portugal as the collapse of their credit bubbles leads to rising defaults, or rescue Italy by accepting plans for EU "union bonds" should the debt markets take fright at the rocketing trajectory of Italy's public debt (hitting 112pc of GDP next year, just revised up from 101pc -- big change), or rescue Austria from its Habsburg adventurism. So we watch and wait as the lethal brush fires move closer. If one spark jumps across the eurozone line, we will have global systemic crisis within days. Are the firemen ready?"
While Rome Burns

I hope the writer is wrong. But the ECB is dithering while Rome burns. (Or at least their banking system is -- Italy's banks have large exposure to Eastern Europe through Austrian subsidiaries.) They need to bring rates down and figure out how to move into quantitative easing. Europe is at far greater risk than the US.

Great Britain and Europe as a whole are down about 6% in GDP on an annualized basis. The Bank Credit Analyst sent the next graph out to their public list, and I reproduce it here. (www.bcaresearch.com) In another longer report, they note that the UK, Ireland, Denmark, and Switzerland have the greatest risk of widespread bank nationalization (outside of Iceland). The full report is quite sobering. The countries on the bottom of the list are also in danger of having their credit ratings downgraded.

Aggregate Sovereign Credit Risk

This has the potential to be a real crisis, far worse than in the US. Without concerted action on the part of the ECB and the European countries that are relatively strong, much of Europe could fall further into what would feel like a depression. There is a problem, though. Imagine being a politician in Germany, for instance. Your GDP is down by 8% last quarter. Unemployment is rising. Budgets are under pressure, as tax collections are down. And you are going to be asked to vote in favor of bailing out (pick a small country)? What will the voters who put you into office think?

We are going to find out this year whether the European Union is like the Three Musketeers. Are they "all for one and one for all?" or is it every country for itself? My bet (or hope) is that it is the former. Dissolution at this point would be devastating for all concerned, and for the world economy at large. Many of us in the US don't think much about Europe or the rest of the world, but without a healthy Europe, much of our world trade would vanish.

However, getting all the parties to agree on what to do will take some serious leadership, which does not seem to be in evidence at this point. The US almost waited too long to respond to our crisis, but we had the "luxury" of only needing to get a few people to agree as to the nature of the problems (whether they were wrong or right is beside the point). And we have a central bank that could act decisively.

As I understand the European agreement, that situation does not exist in Europe. For the ECB to print money as the US and the UK (and much of the non-EU developed world) will do, takes agreement from all the member countries, and right now it appears the German and Dutch governments are resisting such an idea.

As I write this (on a plane on my way to Orlando) German finance minister Peer Steinbruck has said it would be intolerable to let fellow EMU members fall victim to the global financial crisis. "We have a number of countries in the eurozone that are clearly getting into trouble on their payments," he said. "Ireland is in a very difficult situation.

"The euro-region treaties don't foresee any help for insolvent states, but in reality the others would have to rescue those running into difficulty."

That is a hopeful sign. Ireland is indeed in dire straits, and is particularly vulnerable as it is going to have to spend a serious percentage of its GDP on bailing out its banks.

It is not clear how it will all play out. But there is real risk of Europe dragging the world into a longer, darker night. Their banks not only have exposure to our US foibles, much of which has already been written off, but now many banks will have to contend with massive losses from emerging-market loans, which could be even larger than the losses stemming from US problems. Plus, they are more leveraged. (This was definitely a topic of "Conversation" this morning when I chatted with Nouriel Roubini. See more below.)
The Euro Back to Parity? Really?

I wrote over six years ago, when the euro was below $1, that I thought the euro would rise to over $1.50 (it went even higher) and then back to parity in the middle of the next decade. I thought the decline would be due to large European government deficits brought about by pension and health care promises to retirees, and those problems do still loom.

It may be that the current problems will push the euro to parity much sooner, possibly this year. While that will be nice if you want to vacation in Europe, it will have serious side effects on international trade. It clearly makes European exporters more competitive with the rest of the world, and especially the US. It also means that goods coming from Asia will cost more in Europe, unless Asian countries decide to devalue their currencies to maintain an ability to sell into Europe, which of course will bring howls from the US about currency manipulation. It is going to put pressure on governments to enact some form of trade protectionism, which would be devastating to the world economy.

Large and swift currency swings are inherently disruptive. We are seeing volatility in the currency markets unlike anything I have witnessed. I hope we do not see a precipitous fall in value of the euro. It will be good for no one. It is a strange world indeed when the US is having such a deep series of problems, the Fed and Treasury are talking about printing a few trillion here and a few trillion there, and at the very same time we see the dollar AND gold rising in value. Which all serves as a good set-up to the next section.

***********

John Mauldin, Best-Selling author and recognized financial expert, is also editor of the free Thoughts From the Frontline that goes to over 1 million readers each week. For more information on John or his FREE weekly economic letter go to: http://www.frontlinethoughts.com/learnmore

The Euro, Fundamentally will not work

When others were fawning over the European Union and its committee creation of the euro, Milton Friedman made this prescient and brilliant comment:

"It seems to me that Europe, especially with the addition of more countries, is becoming ever-more susceptible to any asymmetric shock. Sooner or later, when the global economy hits a real bump, Europe's internal contradictions will tear it apart."