What Does Political Upheaval In France And Greece Mean for The Price Of Gold?

May 7, 2012 by
Filed under: Economic News, gold bullion 

Now that Nicolas Sarkozy has lost the presidency to a socialist in France and Greek voters have decided that they really don’t want their country to get out of debt, what does that mean for the price of gold? New French President Francois Hollande wants to lower the retirement age from 62 to 60 thus making the country even less productive as a whole and he also wants to tax millionaires at 75% of their income. Not a big deal here because French voters put him in office based on these profoundly unsound economic thievery principles.

While this is temporarily strengthening the US dollar while it is weakening the Euro, the immediate effect is to lower the price of gold. However, once new President Hollande figures out he can’t possibly pay the bills with such early retirement and tax policy foolishness, economic stagnation will begin in France (worse than it already is) and spread around Europe like cancer. And with Greek voters rejecting any austerity measures, Eurozone collapse is soon to follow thus making for that possible day of reckoning that will put the price of gold through the roof.

The next few short months in Greece should be quite interesting as all the hard fought austerity measures and agreements hashed out to try and bring some stability to the sinking ship that is the Greek economy gets scrapped and everybody goes back to the drawing board. That is surely something German Chancellor Angela Merkel as well as German voters won’t be happy about. There probably won’t be much tolerance for shenanigans from Greek riots and then asking for bailout money from the rest of Europe once again.

The day of reckoning is much closer.

Source: MarketOracle.co.uk


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