A lot of investors are wondering whether gold is secure from Europe’s debt crisis. In accordance to popular e-newsletter Profit Confidential, the supreme debt crisis and lack of political zeal to answer core problems will result in price modification not simply in the stock market, but in valuable metals and other belongings as well. Long-time analyst and contributor for Profit Confidential, Mitchell Clark, stated that in the current situation, financial markets are quite fluctuating and may affect the asset class too.
In the middle of September 2011, there was a significant drop in the price of gold, but it has recuperated and gold prices have now become steady. The investors are typically worried about the euro zone debt crisis and the stable drop in the value of Dollar. The cost of silver also suffered a momentary setback but is steadily escalating up now.
Financial brokers and professionals are of the view that gold is back on track after the sudden change of prices in November previous year, when people began selling and liquidating the expensive metal. However, it won’t be acceptable to state that gold costs are moving up. Currently, the economic condition of the market is quite stable and the investors are hoping for the best. They are waiting for the right opportunity to make the right move. However, it must be noted that gold will probably manage to retain its position even if Dollar becomes more powerful. Technical purchase also played a vital role in keeping the value of Dollar stable.
It was anticipated that Ireland could pay back its debt if there was a significant rise in the price of gold towards the end of the year. Investors are apprehensive that the debt crisis in Ireland will slowly spread to other areas of the euro zone as well. The condition of Greece is not very promising either and the financial situation of the nation is on the verge of disintegration. In reality, several nations in the euro zone like Poland and Romania are facing debt crisis. Under such circumstances, gold seems to be a comparatively safe investment to people, since the economic problem is likely to spread to other parts of the globe very soon. Presently, the position of gold is quite strong. Moreover, the drop in the prices of bonds of the U.S. and German governments has provided people with a reason to invest in gold.
A rise in the borrowing prices of euro zone members has resulted in doubt on whether the obliged member nations can probably reduce their debt. In the mean time, Ireland has requested for help from the EU in order to eliminate its debt although the country hasn’t officially approached the latter. Market analysts have also stated another fact. A powerful Dollar can splendidly reduce the valuation of gold. Nevertheless, if the debt problems in the euro zone intensify, then the gold as well as the dollar will be safe place for the investors.
The European nations of Cyprus, Italy, Portugal and Spain had their credit ratings downgraded by two notches and Austria, France, Malta, Slovakia and Slovenia were hit by a one notch downgrade Friday afternoon January 13, 2012. The announcement came after 4:00 pm Eastern time by the S&P so as not to spook the market into a possible free fall although word of the downgrade leaked out earlier and the US markets dropped nearly 50 points on the DOW.
The action taken by the S&P credit rating service was because they deems the actions taken by these countries so far are not sufficient to relieve the systemic stress in the euro zone. Really? No kidding the measures taken so far aren't sufficient. If they were, the European union wouldn't be on the verge of collapse. It's a wonder that the credit of any nation in the Euro Union has any credibility whatsoever at this point. Europe has been running roughshod with money that belongs to the people for decades and they expect a little bandage is going to solve the crisis of decade of monetary and fiscal irresponsibility.
I find it utterly amazing that educated men and women who run these nations cannot figure out that they can't spend more money than they take in. But, gee whiz, neither can the majority of the population who collect government money for doing nothing. Apparently no one realizes that there is no more money to spend and all the EU has been doing for the last 5 years is to move the money around and put out one fire after another. At some point there will be no more money to spend, and serious things will happen. Yes, serious consequences will take place when the minions don't have any cash because the government can no longer afford to dole money out to them.
Moving headlong into eventual default is Greece where talks broke down between the nation and its creditors over swapping debt. if a default is to be avoided someone somewhere will have to buy Greece's debt. But, this will only delay the inevitable because the powers that be still want to spend like there is tomorrow.
Some day soon, there will be no tomorrow. Very soon.
If you didn't know it, the world is facing a major water crisis and shortage. More than 1.2 billions people worldwide live in areas where either the water is polluted and causes disease or the supply is no adequate. In other words, they simply do not have enough water. And while Iraq used to receive an abundance of water from neighboring Turkey flowing through the Tigris river to the tune of 500 cubic meters per second, lately because of various dam projects being built on the river by Turkey, that number is down to 350 cubic meters per second.
As the nation of Iraq tries to recover from the ravages of a 10 year war and internal strife, water is obviously a major issue. With the most abundant source of water, the Tigris, flowing less because of actions by Turkey and added to that fact that it is more polluted in recent years due to the war, this is creating a huge crisis. The reason for more pollution is that due to the consequences of war, there is no one to see to it that the laws forbidding desecration and pollution of the Tigris are enforced. During the reign of Saddam Hussein, even though he was a monster dictator, there was at least an infrastructure to manage and care for the water supply. Unfortunately, that is no longer the case.
As the infrastructure continues to be rebuilt in Iraq, some of the ongoing water problem will be fix as part of the crisis is transportation needs, but the major crux of the problem is that there is just not enough water. One of the solutions proposed to solve this crisis is to sip water from Alaska to India, namely India, and then further transport it to the Iraq port city of Umm Qasr which is approximately 35 miles up to mouth of the Khawr az-Zubayr Waterway from the Persian Gulf.
Whether or not this actually happens all depends on many factors, the most expensive of which is the sheer cost of transporting a heavy commodity such as water several thousand miles over the surface of the ocean. At the present time the cost of this is prohibitively expensive, but more efficient ways may be found to move the water such long distances. If the obvious cost problem is overcome, this may be a great investment opportunity for those that are so inclined to be involved in. It does however remain to be seen as to whether this will ever be viable as a mode to solve the water crisis in Iraq. Stay tuned for further updates.
