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Market Ends Up on the best day In two years…but beware.
Cashmechanics takes a look at yesterdays rally, what it means for the dollar, gold, and most importantly, the fragility of the Eurozone.
Our expert take on this is a sharp rise in the price of gold due to inflation by the release of more money into the banks to prop them up just a little longer. Gold prices rise on the falling dollar and yesterday was no exception. It’s looking like this is a good time for first time investors to buy into Gold. As for the Eurozone, things are not looking so great.
Dollar swaps seem to be the way to go but a permanent solution to prevent the collapse of the Euro have not been put into place nor decided on. Recently, Poland’s Foreign Minister has called upon Germany to take the reigns and protect the Eurozone from an apocalyptic failure. Germany seems to be the only Country able to bailout faltering Eurozone members but Merkel is reluctant to do so.
So what exactly does this all mean? The simple answer is that a whatever solution Eurozone members create will only be a band aide. The Euro is on a slow bleed but don’t pull out just yet. The Euro is still a fair investment but confidence in any future yields are slowly eroding. The ECB is reluctant to make any substantial moves now that the Fed is willing to step in.
Stay tuned as Cashmechanics studies the situation for Forex exchange rates.
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