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Tuesday, March 20, 2012

France’s Upcoming Election Means Euro Devaluation—and a Pop In Gold

Europe, the euro and what's up next for the dollar, the euro and the west? Answer: more spending, more money printing and more misery.
I’m pretty sure two things will happen immediately following the election: The first is, Carla Bruni will leave Nicolas Sarkozy (because everyone knows that a professional courtesan never stays when the going gets tough for her patron). The second thing that will happen following the election of Hollande is that the euro will begin to fall—amid persistent, insistent calls by the new French President for Europe to spend its way out of the hole it’s in. In other words, France is about to elect their version of Paul Krugman to the Presidency. Up until now, Europe has been going the way of Austeristan: Forcing the weaker eurozone nations (Greece, Portugal, Ireland, Spain, Italy) to severely cut their budgets and reign in their deficit spending, so as to thereby cut their overindebtedness. (Though Germany itself has been conspicuously remiss in meeting its own austerity targets.)
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Gonzalo Lira

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