Is the Euro about to get wasted?

L

Lincsbodger

Fears that the euro is heading for collapse have prompted panic buying of gold coins and bars in parts of continental Europe, according to industry players.

Austria’s mint, which makes the region’s best-selling gold coin, warned this week it may run out of stock as investors seek a safe haven from Europe’s tumbling currency.

And banking giant UBS reported its Zurich and Geneva sales desks are ‘exceptionally busy’ coping with heightened demand for coins and small bars, much of it coming from Germany.

Swiss refinery Argor-Heraeus estimates demand for small gold bars and minted products has jumped tenfold since the start of the year.

The news came as the euro took another dive amid fears the £640bn EU/IMF rescue plan hatched up over the weekend would fail to secure the single currency’s future.

Against the dollar, the single currency sank under $1.254. That was not far from the 14-month low of $1.25 it struck one week ago.

Marcus Grubb, a managing director at the World Gold Council, an industry body representing miners, said anecdotal evidence was flooding in of a sharp increase in purchases of coins.

Much of the buying is concentrated in Germany, but Austria and Switzerland are also seeing increased purchases, he told the Mail.

'There has been a spike in demand for physical products in the past week or so as a result of the volatility caused by the sovereign debt crisis in Europe,' said Mr Grubb.

‘Scepticism about the euro has been strongest in Germany. Retail investors are voting with their feet and buying gold coins. They are concerned about the prospects for the currency.’

The market price of gold traded at $1,233.95 a troy ounce yesterday, shy of the record $1,248.15 it hit on Wednesday.

Gold bars and coins are seen as a safe haven when there are fears that paper currencies could lose their value.

At the height of the banking crisis in 2008, for example, the US mint suspended sales of popular Buffalo and American Eagle coins because of a flood of demand.

More recently money-printing programmes in the US and Britain have fuelled fears of inflation, and these have now spread to the euro area.

This week the European Central Bank announced it would purchase government bonds, in a move similar to the Quantitative Easing policy undertaken by the Bank of England.

Meanwhile some economists are warning that Greece remains headed for a debt default, and that its woes could spread to other eurozone countries, threatening the future of the euro.

Portugal and Spain are seen as particularly vulnerable because of their heavy debt loads.
 
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We'll be able to sell our vast gold reserves for a fortune.
 
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so basically what your saying is my holiday should be a few quid cheaper next year :D
 
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Nordio

The greedy greeks are straddled over a bomb, waving a cowboy hat vigorously in one hand as they ride that baby down to Earth. I wish them the best of luck and my condolences.
 
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Over here in the land of the Wurst (sauage for the uneducated) there's definitely plenty of cash and Angie has been very generous to the rest of Europe in handing it out. The locals are definitely not impressed. She has allready been defeated in one local election and lost the majority in the upper house. If she and the coalition (new word for the UK) don't smooth things over she's out. This will be interesting for the EU because the locals will be looking to vote someone in who isn't so free with their cash.
 
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I doubt the euro is exactly "doomed" as such but there are likely rocky times ahead for some of the eurozone.

Britians debt is pretty bad but afaict most of it is denominated in pounds and so if push comes to shove we have the last ditch option of inflating our way out of it. Eurozone countries don't have that option because the money supply is centrally controlled.
 
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We can't even pay our £40 billion yearly interest without borrowing it. We are going where Greece is going - and that (according to an Oxford professor I heard) is a mathematical fact.
 
L

Lincsbodger

I doubt the euro is exactly "doomed" as such but there are likely rocky times ahead for some of the eurozone.

Britians debt is pretty bad but afaict most of it is denominated in pounds and so if push comes to shove we have the last ditch option of inflating our way out of it. Eurozone countries don't have that option because the money supply is centrally controlled.

Exactly, the single biggest arguent to stay wel laway.

We saved ourselves from the worst of the credit crunch because we could fiddle with the interest rate and print more money and feed it into the banks. If we hadnt been able to do that (and in the Eurozone would wouldn't have been able to), we'd now be in deeper poo than Greece.
 
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hi im joe. i get out of bed every morning and look on the bright side of life :LOL:
 
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joinerjohn

Quote "And banking giant UBS reported its Zurich and Geneva sales desks are ‘exceptionally busy’ coping with heightened demand for coins and small bars, much of it coming from Germany"


That will be the gold that Germany looted during the war then. ;) ;)
 
J

joinerjohn

Just think on.... Some political Parties wanted us to join the Euro not so many years?months/ weeks ago.
 
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