The Coming Crash of the Euro

Why huge profits await investors who position themselves for the euro's inevitable bust! 


Dear Reader,

Are you interested in what may be the greatest money making opportunity of your lifetime?

I'm going to tell you something you may or may not already know...the European monetary system is on the brink of collapse and this could mean a fortune to you if you play it right.. 

When world famous speculator George Soros made one billion dollars back in 1992 he bet that the British Pound would plummet. He knew that Britain would be forced to pull out of the Exchange Rate Mechanism, a system of fixed exchange rates that existed in Europe at the time. Pressures had been mounting in the British economy and it was forced to de-peg its currency from the other European currencies and allow it to float freely in order to avoid skyrocketing interest rates and an economic crash.

Soros shorted the Pound and cleaned up to the tune of ONE BILLION DOLLARS!

A similar thing is about to happen with the euro, only much, much, bigger!

The Euro is a flawed currency

Let me give you a little background. Back in the 1980s the leaders of Germany and France conceived an idea for a single currency. On the surface and in their speeches and rhetoric they said that having a single currency would unite the European economy and make it more efficient and productive. But really, their motive was political. It was to create a currency that would challenge the U.S. dollar.

The idea was certainly grand, but it lacked a basic underpinning. In truth it was not designed with the principles of good economics, but rather, on political considerations only. 

Under a single currency all countries that adopted the euro would have to give up their own monetary sovereignty. In other words, countries like France and Germany would have to stop issuing French francs and Deutsche marks and as such, they could no longer conduct independent monetary and fiscal policy. They went from being currency issuers (a status that has enormous benefits) to being currency users. 

Political leaders pushed on with their plan and made everyone believe it was a great idea. Eventually the day came in 1999 when the euro became the official currency of 11 European nations. Many other nations have since joined.

The good times rolled along and the euro became embraced by investors and many of the world's central banks. The value of the euro went from 80 cents in 2001 to nearly $1.55 by 2008. It had practically doubled in only seven short years. There was even talk of the euro eventually supplanting the U.S. dollar as the world's main reserve currency. Everybody was hopping on board and the euro started to look like an unbelievable success. But the euro's fortunes were about to hit a brick wall!

When the global financial crisis hit, in the midst of the chaos and panic that ensued investors throughout the world clamored for the safety of the U.S. dollar. Little was understood in the beginning and it was thought that America was facing the greatest difficulty, but soon it became clear that Europe had far worse problems and lacked the means to address them. .

Eurozone countries are like states in the United States

What the economic crisis exposed so clearly was that the European countries no longer had the power to employ fiscal policy to support collapsing demand. Where countries like the U.S. and China have the ability to come in and stimulate their economies to whatever degree necessary to avoid a true depression,  European nations can't. In essence they have become like states in the United States and simply aren't able to issue currency to "print" their way out of a major downturn. 

Strapped for cash and with no overriding fiscal authority to support their economies, European countries are now finding themselves in deep, deep, trouble. That is setting up a goldmine of an opportunity for smart investors.

Read on...

It may help to think of it like this: if a state in the U.S. is strapped for cash then it is pretty much out of luck. The only thing it can do is dramatically cut back on services and spending. That would mean less police, fireman, teachers, road maintenance and many of the other essential things that residents in any state are used to. Or, it could tax its residents to death, which would cause people and businesses to move, collapsing revenues even further and triggering off a death spiral. 

When push comes to shove only the Federal Government can bail out a state, but that's the difference. In the United States there is an overriding fiscal authority in the Federal Government that can come to the aid of an individual state, but in Europe there is none! There is no "Federal Government of Europe." This means if countries like Spain, Greece, Portugal, Italy or even France or Germany for that matter are strapped for cash they are in serious trouble with very little recourse.

Of course the European Central Bank, which has unlimited ability to print money just like the U.S. Government, however, the ECB is precluded by the Maastricht Treaty--the document that is the governing framework of the European Union--from bailing anyone out, let alone a member state. Moreover, even if it could, the ECB's anti-inflation mandate would likely keep it from doing so no matter how dire the situation got.

And the situation is getting bad...real bad.

Remember Argentina in 2002...

Right now the country facing the most difficulty is Greece, which has a small economy, but it's of big  importance because it is viewed as the weakest link in the chain.  Greece is struggling with high debt and no means to stimulate its way out. It is being forced to adopt austerity measures and that is triggering layoffs and cuts in services. 

As the crisis continues to unfold we are now seeing protests and riots erupting in the streets of Athens. The very fabric of society is fraying and the government is trying to maintain calm, but the clashes are becoming more frequent and more violent.

Back in 2002 this was happening in Argentina. At the time Argentina's currency was pegged to the U.S. dollar, which meant that its monetary and fiscal policy was effectively neutralized. By pegging to the dollar Argentina did not have the power to create money and stimulate the economy. That was effectively transferred to the Federal Reserve and the U.S. Treasury, which were the monopoly issuer of dollars. 

The problem for Argentina, however, was that neither the Fed nor the U.S. Congress and the Treasury were concerned about its economy.  Rather, they were only concerned with the economy in the U.S. and when the Fed starting raising interest rates it drove up the value of the dollar and that caused Argentina's exports to collapse, causing a domino effect of economic contraction and bank failures.

Argentina's central bank could not counter this by printing money to offset the monetary economic and credit crunch that was occurring. Soon there was literally blood in the streets as banks were closed and rioting ensued. People were killed. The situation become so grave that eventually, the country had no other choice...it would either have to continue the way it was going and watch the society devolve into chaos or it would break the peg with the dollar and reissue the peso. It chose the latter and within weeks the situation improved. Banks reopened, violence stopped and the chaos ended. The economy rebounded and the Argentine stock market was the best performer from 2002 to 2006. The point is, it had to break the dollar peg so that it could be freed to pursue its own monetary and fiscal policy.

Europe will be the new Argentina!

 

Violence erupting in the streets!

Now we see the same sort of thing happening in Greece. People are rioting in the streets and protesting the imposition of austerity measures that are leaving families without the means of support, even without food in some cases. It's getting worse by the day. The politicians are forcing this on the Greek people, but it can only be done with heavy handed crackdowns, which are not working because we see that the protests are escalating.

The Greek government is caving in to demands from bureaucrats in Brussels who are telling them that they have to cut back on spending, which means laying off more and more workers. The hardships in society are rising and the demonstrations are gaining momentum and becoming more chaotic by the day. History shows that popular discontent can lead to the overthrow of governments if that discontent becomes severe enough and this is no garden variety recession, but a major and long lasting economic downturn.

How long can the Greek government continue to hold back this disorder? It's hard to say but as each day passes the pressures are mounting. The irony is, the solution to their problem lies right in front of their noses. If they were to leave the euro and begin reissuing their own currency, their problems would go away almost overnight. The temptation has got to be great.

Greece is not alone, there are four other countries that are "terminal" with respect to their deficits and they are having the same demands being placed upon them. One of them is Spain, a fairly large economy in Europe with a population of 40 million.

Where do the Europeans get the money to bail out Greece or if necessary, the others that are on life support? The answer is, they have to borrow it or take it from the savings of the people in wealthier nations like Germany. But even Germany no longer has a truly independent fiscal authority that can create money. The amount of money they have to lend or to be used to bail anyone out another anyone, let alone another nation is limited. They are done!

Milton Friedman said that the euro would never last!

 

The great, Nobel Laureate economist, Milton Friedman once said that the euro experiment would not last more than a decade. Well, it’s been a little bit more than a decade but the cracks are showing and they are widening by the minute.

Speculators have seized upon Europe's troubles and are now hammering the euro. The price of credit default swaps, which are instruments that allow investors to bet on the likelihood of a default, are skyrocketing. That is a sure sign that savvy speculators believe that a collapse is imminent!

The credit default swaps of European countries is rising and in the case of Greece they have gone parabolic. Billions in speculative bets are pouring in making the collapse almost a "fait accompli.". The rating agencies like S&P, Moody's and Fitch have already downgraded Greece's credit and they are closely watching the other countries. Any further credit downgrades would be fatal because it would raise the cost of borrowing when they already can't afford to pay for basic services.

These countries are on the brink and there is nothing they can do!

 
Was Milton Friedman right?

Before the launch of the euro in 1999, Milton Friedman predicted that the Eurozone would not survive its first economic crisis.

He noted that in a world of floating exchange rates, if one country faces a shock, it could simply respond by letting the exchange rate change. But with the arrival of the euro, that option is no longer available.

Mr. Friedman also highlighted the case of Ireland. In 2001, he said the country should have been tightening its monetary policy but couldn't because it was tied into the new European currency. "The European Central Bank makes monetary policy for the whole of euroland."

In the absence of currency flexibility, analysts say competitiveness can only be regained through real economic adjustment such as labour reductions and downward wage adjustment.

We hear talk of a bailout, but by whom? Only the ECB can truly bailout Greece or one of the other European nations, but it's precluded to do so by the Maastricht Treaty, which is the framework of European governance. So where will the money come from? From investors around the world who are now asking for ever higher interest rates because of the risk that goes with lending to these shaky economies? These are loans that Europe surely can't afford!

Some people believe Germany will step up to save the weaker peripheral countries of Europe. But even Germany, the largest economy in Europe, is no longer a currency issuer. It cannot simply "print money" as it could in the old days of German reunification to help Greece and the others that are in trouble. Germany would have use the savings and wealth of its own citizens to save a non-German state. Let me ask you...how popular, politically, do you think that would be? I can tell you this, it's not like Americans in New York helping out Americans in California. We're all Americans, but in Europe, national pride still runs deep and there is populist resistance to this type of a bailout.. It's no wonder, then, why German Chancellor Andrea Merkel throws cold water on the idea every time you hear her comment on some new report that Germany was about to write a check for Greece.

What if we don't get a bailout? Then that means Greece simply knuckles under to the demands of the bureaucrats and the financial markets and it will have to continue to cut spending dramatically. This will lead to a cycle of collapsing demand in an already weak economy, which will lead to spiraling lower economic activity and a further rise in deficits. That prescription is painful and bound to increase the level of unrest. It's a no win situation. It will fail.

Then the question becomes, if Greece goes, who's next? Spain, Italy, Portugal and Ireland all face the same debt bomb with no easy way out. Even Germany and France are not immune. If they are seen lending a helping hand to these weaker nations then their own bond markets will come under speculative attack as well. 

 

No choice...the euro must devalue!

At the moment it appears as if exit from the euro is the choice of last resort for Greece and the other nations in question, however, like the path chosen by Argentina back in 2002 it's the fastest and easiest route to recovery. Ego and pride are keeping the Greeks and the Europeans from allowing this to happen. Political leaders are trying everything to put the best face on this and hold the euro together, but is there really any chance of saving the euro from collapse? It seems unlikely. In fact, it is becoming very obvious to some of the world's most savvy investors that the euro cannot exist under the current structure.

This means there will soon be huge profits to be made!

Even if the European countries all toe the line and impose austerity measures to reduce deficits it will only make things worse. It would lead to collapsing demand across the continuant and economic growth would plunge, thereby raising deficits even higher and causing credit downgrades. This in itself would trigger a selloff in the euro, as investors react to this death spiral. The European Central Bank would be forced to inject huge amounts of liquidity into the financial system to avoid a total payments crisis. The euro would plunge in response. 

Speculators swarming in!

 

As the economic pressures on Greece and the other European countries mount they are faced with a new and dangerous enemy: large speculative funds that are circling like hungry sharks, ready to bite huge chunks out of these bleeding economies. In some cases they are the very Wall Street investment banks like Goldman Sachs, who had worked to hide much of Greece's debt over the past few years by designing derivatives that would make it look like the country's finances were better than they really were. 

Goldman and other big market players have now become turncoats and are actively shorting the debt of Greece or buying credit default swaps, bets essentially on a default. Greece’s small economy is easy prey to these financial vultures and without the backing of the EU against these predators Greece is surely doomed. Moreover, this would represent an enormous score for these Wall Street speculators who would feel empowered as never before in the knowledge that they could successfully target and bring down entire countries. Next in line will be Spain, then Italy and the rest of the struggling periphery. Even Germany and France would not be safe.

 
Large hedge funds shorting euro: Wall Street Journal

Large hedge funds are betting on a drop in the euro, expecting that the European currency will fall to parity with the U.S. dollar, according to a recent Wall Street Journal report.

The report cited unidentified people quoting comments from "all-star hedge-fund managers" representing the likes of SAC Capital Advisors LP and Soros Fund Management LLC at a recent New York gathering. 

Some of those managers said the euro, which traded at $1.51 in December but was currently at $1.37 amid concerns about Greek sovereign debt and other issues, could soon fall to $1.00.

A $5000 investment would be worth $55,000 if the euro dropped to $1.00!

 

Turn a $5,000 investment into 100 grand!

The scenario I've just described is inevitable...it's going to happen; it's just a matter of time and the time is coming. That's why you need to get on board now if you expect to make the big money.

If the euro falls to $1.00 as the savvy group of speculators believe I can show you how you can make 10 times your money! 

Even better...if the euro goes back to where it was in 2001, that would turn a $5,000 investment into $100,000!

 

$39.95 will get you on your way...

In my new report Euro Crash Alert! I will show you 10 ways you can capitalize on the coming collapse in the euro. I have included everything from very low risk, extremely conservative strategies to highly leveraged, supercharged campaigns to make a huge score with just a small investment. 

 

Some of the things I cover are...

Which exchange traded funds are best to profit from a euro decline

Strategies for shorting the euro using common stocks

How to employ futures and options for a low risk, high reward strategy

And...maximizing the full potential of a euro decline using spot Forex!

Each of these strategies plus more are covered in detail and give you precise instructions on how to execute these trades.

You will not find a more concise game plan anywhere!

...and it's all yours for only $39.95!

That's right...for less than the cost of a modest meal you will have access to information that will allow you to cash in on huge profits when the euro collapses!

The speculative sharks are circling and the nations of Europe and they are helpless. They cannot combat this attack. They do not have the means anymore at the disposal to sustain their collective economies and ward off the predators...the barbarians at the gates.

And even if the speculators found reason to leave the euro alone it wouldn't make any difference. A global recession is weighing down on these economies with crushing force and the deflationary pressures are increasing every day.

When you think about it, the collapse of the euro will be as normal and natural as the an earthquake or an avalanche in the physical world. When the pressure builds up along the tectonic plates of continents or when massive amounts of fresh new snow lay precariously along the side of a mountain something gives. That pressure has to be released; there is no force that can hold it back.

The fate of the euro has already been decided. It was decided, as Milton Friedman predicted, at the moment of its creation when the architects of the currency decided to forego creating a strong and unchallengeable fiscal authority as a foundation. Perhaps they thought that it wouldn't be necessary or that this day would never come. More likely, it was their zeal to create a rival to the dollar that caused them to make choices that would make the euro a currency destined to fail.

Some members of the European Parliament already concede this. They see the writing on the wall. Read the comment of Parliament member, David Campbell Bannerman:

 

"We believe the Euro will collapse either totally or in part. This is the first of a number of countries, it's not just Greece. They call them 'the pig states' – not a nice term, but they are, apart from Greece, also Portugal, Italy, Ireland, and Spain. Having a 44% unemployment rate among its young, Spain could well be next..."
-MEP David Campbell Bannerman

 

A major currency collapse has already begun!

A major collapse of one of the world's most important currencies is already occurring. This is not the Argentine peso or the Turkish lira or the Russian ruble or even the British pound in 1992. Those currencies never had the stature that the euro currently enjoys. Indeed about 22% of all forex transactions in the world today are denominated in euro. That compares to about 12% for the yen and only about 9% for the British pound. The U.S. dollar comprises about 50% of all foreign exchange transactions.

Simply put the euro is huge. A collapse would be the financial equivalent of magnitude 10 earthquake on the Richter scale followed by an equally large tsunami. Huge money will be made and lost in this calamitous event. There has not been a financial collapse comparable to this in, perhaps all of history. Even the crash of 1929 would pale in comparison. It would send the entire European Union into chaos and plunge the world's economy into deep recession.

It's very rare that investors are given such an enormous opportunity. Something like this is capable of putting you into early retirement and lining your pockets and bank accounts with cash sufficient for the rest of your lives if you play it right. You can't afford NOT to make a bet on this happening. That's because the world's economy is likely to be affected by this and your investments may not be safe no matter where they are. Selling the euro is a way to ensure your own nest egg!

People are constantly told to buy gold and silver and always have some of that in their portfolios just as a form of insurance. Well the fact is gold and silver have been lousy investments. Over the long term those "investments" have grossly underperformed ordinary common stocks that pay dividends. In order to have made any money on precious metals you had to very, very, sure of your timing. People who bought gold during the last runnup back in 1980 are still underwater when you consider the effect of inflation!

But there are times when something comes along that is a once in a generation opportunity or even more. Suffice it to say it has monumental potential. The euro is deeply, deeply, flawed. It's whole structure is like a house of cards and it cannot last. The raw forces of economics, pure and simple, will drive change...change that will be cataclysmic and result in the demise of an ill-conceived financial construct.

For investors who position themselves before this happens it will mean a sure road to huge rewards.

Don't waste any more time. Order my report, Euro Crash Alert! today and start putting on the position that will earn you huge profits when this happens. The clock is ticking. By getting on board now you are sure are giving yourself the best risk/reward potential. The longer you wait, the less attractive this trade becomes. 

I'll even give you one more reason to act...

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So, what are you waiting for? Get Euro Crash Alert! and get ready to cash in on one of the greatest financial cataclysms of all time!

Sincerely,