Thursday, May 20, 2010

Part 1: European Dominos: Global Cascade?

A May 19th article by Leo Isaak on www.minyanville.com caught my eye.  Even for a guy who admittedly reads too much doom and gloom this one shocked me to my core.  Isaak lays out his thoughts about how the globalized economy could play out in light of the current Euro mess.  "I think Europe could very well destroy any hope of a recovery that we thought we might see.  Not only that, I think it could push the world off of a precipice of debt that, if it were to occur, would create something resembling outright disaster.  Austerity combined with savage debt service issues and crushing currency devaluation is impacting the entire world, and we're now starting to see the economic domino theory I wrote about a month ago.  Frankly, I'm nothing short of terrified.  These aren't words I use lightly.  In fact, the last time I uttered them was July 2008 in an email to my closest friends warning them of an impending crash."  Over the next several days I will attempt to summarize Isaak's rationale for being so "incredibly bearish" (his words), and where he thinks investors might find some protection.  Even better, click on www.minyanville.com and read the original article yourself.  Canada is looking like the best place in the world to live not only now but in the near future.