In this week’s Off the Cuff with Mish & Chris podcast, Chris and Mish cover:
Yesterday’s Market Carnage
- Are we seeing an important shift in investor sentiment?
- The Future of Europe
- Can the Eurozone remain intact? If not, what does that mean?
- How This Will End
- Deflation or currency collapse? (or both?)
- Where should investors looking to preserve purchasing power put their capital?
Chris and Mish have been amazed at how the equity markets have continued to levitate of late, given the absolutely horrible news over the past few weeks. Well, wonder no more. Blow-out spreads in European bond markets and today’s equity market carnage are a wake-up call that — finally — investors are starting to appreciate the unsustainability of the system. Italy and Greece (and many other EU countries) are insolvent, and now that the bond market is in full revolt, the rising interest rates are adding billions of euros in additional sovereign debt payments. Chris and Mish see the European Central Bank (ECB) as having only two choices: Let the system implode on itself, or print like crazy. The smart money is on the latter.
Both see this ending with the breakup of the Eurozone. Mish believes it’s inevitable that Germany will opt out of the euro and return to the Deustchmark, as it has little self-interest to continue as the communal pocketbook for the rest of Europe.
by dbworld