Gold Research Videos

Hellmeyer points out that the ECB is trying to monetise as little as possible, contrary to what the Bank of England and the Federal Reserve are doing. He also believes that European countries are in a much better shape than reported. He agues that there is aggressive speculation against the eurozone that disregards the reforms that have been undertaken, while other countries are simply monetising without any fiscal reforms. He points out that regarding debt to GDP ratios, budget deficits and reforms Europe is in a much better shape than for instance the US, the UK or Japan. This unfair treatment of Europe has a political taste to it and Hellmeyer even calls it a “scandal”. As a solution he proposes ring-fencing by the ESFS and the ECB.

James Turk makes the point that the ECB has become more political and less independent than the Bundesbank was which makes the euro a weaker currency. Hellmeyer argues that it is the wiser choice to break rules by buying up sovereign debt of eurozone countries than to let the whole financial system collapse, risking global political instability. He still believes that the ECB stands for a relatively stable approach in comparison to other central banks. He also points out that the Bundesbank never faced a similar crisis to the one the ECB is now facing.

Hellermeyer states that the euro is regarded very positively by most member countries, except for maybe Finland, Austria and Germany. He is rather bullish on the growth perspectives for Europe and believes that most of the current outlook is negatively impacted by political uncertainty. Once this is removed he projects 5% global growth and 1.7% to 3% growth in Germany, but with higher inflation. Regarding the United States, Hellmeyer points out that the loss of their production base as well as their meager tax revenues means that the US-economy is poorly positioned.