In this week’s Off the Cuff with Mish & Chris podcast, Chris and Mish kick the new year off discussing:
Europe
- The backstabbing begins among Eurozone members.
- Oil
- The risk of even higher prices just got a lot worse.
- The Aftermath
- What are the most probable economic outcomes at this stage?
The new year is already off to a rocky start, with protectionist squabbling in Europe and growing threats of an oil embargo with Iran. Those hoping 2012 will usher in any kind of economic recovery had better start hedging their bets.
Europe: The backstabbing is beginning to happen in earnest among EU nations. Various new VAT tax and wage-hike proposals are being kicked around that undermine the entire foundation for the creation of the Euro in the first place. Mish predicts that the Eurozone will start to fracture in 2012, with Greece and Spain the likeliest first candidates to depart. Chris is concerned by the enormous block of sovereign debts coming due in the next few years and doesn’t see any possible way they can be serviced, retired, or rolled-over. The word “death spiral” comes to mind.
Oil: Prices have stubbornly remained above $100/barrel and will get substantially higher if the current international deliberations to stop buying oil from Iran are put into practice.
by seportsmouth