Bonjour Mon Amis,
The crisis in Europe is far from over and it is getting worse as France has joined Greece and Italy as a place of near daily dissent. 3.5 million people joined marches around France today to protest against President Nicolas Sarkozy's plans to raise the retirement age from 60 to 62.
Imagine what they will do when they realize there is no retirement funds for anyone? Something that will be made all too clear as the euro currency is doubtful to last much past its 11th birthday (2011 – having been launched in 1999).
In neighboring Germany, the retirement age was recently increased from 65 and 67. Interestingly there was no strike there which confirms the adage that “the French work to live and the Germans live to work”. But what this shows is the cultural imbalances in the Eurozone that will all but ensure the collapse of the euro currency, at least in its current form.
A Dollar Vigilante subscriber, Patrick S. was in France in recent days and managed to get some interesting photos and supplied an interesting anectdote which he was so kind to pass along to The Dollar Vigilante community.
He supplied the photo to the right and had the following comments:
“When walking on Boulevard Montparnasse I noticed an activist with a sign “Arrêtons le Terrorisme Financier – Hyperinflation!” (click on photo at right to enlarge to see sign). Is the knowledge of Austrian economics becoming more widespread in France? Unfortunately not, when I spoke to one of the activists, it turned out that they are the French branch of the LaRouche movement. While the government-run program for a flight to Mars that they propose is unlikely to get Europe out of the economic mess, it is still noteworthy that people are beginning to realize that there is danger of hyperinflation.“
This is only the beginning of a large amount of turmoil in most western countries worldwide as the entire debt/inflate paradigm is reaching its logical end – in collapse.
The Dollar Pops, Gold Drops
After two months without so much as a 1% retraction gold finally pulled back today, dropping from $1,370 to a low near $1,330 for a drop of 3% in reaction to a rise in the US dollar which may have been led by a surprise increase in rates by the Bank of China. In any case, after the run gold has had this was to be expected – it was just a matter of when and from what level.
We got that answer today. Ed Bugos believes that a move of 5-10% off of gold's recent high is healthy and not to be of major concern.
We had been taking some profits on some of our own personal high fliers that had moves of 100-200% in the last few months and we will now be looking to see if we can take advantage of what may be a week or two of weakness to get positioned back in at lower levels on stocks such as the one we released to Full Subscribers on October 18th with the recommendation to “buy on weakness”. This is what weakness looks like and we will be looking to take advantage of it on the buy side in the coming days.