They say that politicians always lie. Well, yes. Of course they lie. Or as Mandelson called it, they ‘create the narrative’. Markets are far more honest. If a price moves up or down, it cannot be denied. It is pure and simple – the truth. As the old saying goes, you should watch where people are putting their money, and see if it’s where their mouths are.
We’ve heard all the spin about the bank stress tests, and how the Euro will be protected, for example. But in the same space of time that this has been happening, the movement between the Euro and the Swiss Franc has been telling a very different story. You needed 1.50 Swiss Francs to buy one Euro six months ago. Today you need just over 1.30. It seems that the real money is not listening to the assurances that the Euro will survive, but getting out as fast as it can, to Switzerland or Tokyo.
While eurozone governments spend their peoples’ money in the forlorn hope of saving the currency, large holders of Euros are taking their chance to get out. No doubt many Greek and Irish financiers will be among these, friends of the same politicians putting their countries through extreme austerity to save their Euro membership. They aren’t going to save the Euro. They are merely buying themselves and their rich friends time to get their money out before the real crash happens.
Talking about Ireland, the Irish stock market has fallen 12.5% is two weeks, falling three times faster than the British FTSE 100, heading south even quicker than the Greek stockmarket.
These market trends, and the fact that Greek ten year bonds are still up over 11% tell you that there is no chance of the Euro being saved. That’s not me talking but is the opinion of the people best placed to know, those with the big money, and with inside information.
So don’t listen too hard to Merkel, Sarkozy,Trichet and Barroso as they swear they will save the euro currency and the eurozone economy. Look instead where they and their rich friends are putting not your money, but their own money. You can’t see the cheques being written, but markets don’t move 20% in a month or two unless someone powerful is buying or selling very hard.
The markets are telling us the truth. The eurozone cannot survive. The rich know and are getting out – while the people of Europe are lashed to the task of saving the unsaveable, losing their economies in the process. The end of the USSR destroyed the Russian economy. The end of the EU will be no different. The message should be sell up and get out while you can. Just copy what they are doing. It’s very simple.
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