The Bad News vs The Good News

EU Titanic

 
FBP Contributor:  Latitude 53

The bad news;The world has been spending staggering amounts of money that it doesn't have for a few decades now. It is now coming home to roost. 

  

Europeans should have faced their problems 2-3 years ago. Every week their concerns become graver.

There is a massive competitive race to deflate. The technocrats who can solve the problems have elected to allow some countries and businesses to fix their balance sheets and thus will be able to survive the coming crash.

Selling assets to eliminate debts, avoid refinancing debt at very high cost  has simply allowed Russians, Middle East kingdoms and Asians to own big parts of Euro business.  Some companies can no longer be considered to be European as significant parts of their ownership is held in other parts of the world.

For example, significant parts of Volkswagen ownership is held  by middle east oil barons. VW's  biggest car plants are in Russia, Mexico, US, Brazil, and numerous Asian countries. 

There is so much Euro debt to be refinanced in 2012 that analysts say Europe must

solve its biggest problems in the next few weeks or face certain disastrous calamities.

The good news;
is that with "CERTAINTY" the Euro problems will be fixed, (even if the previous US $1.50 = 1 euro, now $1.30 falls well below the American greenback, perhaps to $.75, depending how they solve  their problems). There is all kinds of opportunities for many people and countries.

With certainty in the market things will start rolling,  Even with the US massive new debt, it is unlikely with a new president, more likely is major plans to reduce debts.

Certainty  is what will drive all outcomes in the next two or three years.  Some analysts are predicting a $1.15 Loonie to the US greenback.

They say the only reason it didn't happen in 2011 was POLITICS- (world concern about Europe-middle east  problems driving people throughout the world to pick up US assets  in order to best protect their wealth thus inflating the greenback and demand for it). 
If these uncertainties are reduced, and growth occurs in the rest of the world, then countries with lots of commodities to help the world growth will greatly benefit.

Some analysts predict that if Canada starts shipping oil to Asia, California, and South America through its CANADIAN  PACIFIC COAST TERMINALS

the loonie could go even higher, perhaps $1.20  or $1.25 to the US dollar.