Concerns regarding Euro zone bailout fund
As we mentioned some days ago, the initial hope which followed the announcement of an EU EUR750 billion bailout package has all but disappeared and today saw worldwide stock markets fall further. The Euro itself has been under pressure for some days now with many people concerned that the EUR750 billion bailout package will not be enough to cover potential problems in the future.
We have also seen significant public-sector investment cuts in Spain and Portugal with more expected across Europe. There is no doubt that a concerted effort with regards to public-sector investment cuts is needed but this is likely to delay any strong economic recovery through Europe. However, the flipside of the coin is that many countries in the euro zone are struggling to survive and unless budgets are cut immediately we could see Greece part two, part three etc. etc.
In contrast today we saw the price of gold firm with investors looking for a safe haven for their funds in these times of worldwide stock market volatility. There is no doubt that the next few months will be difficult for both the Euro zone and worldwide and any hopes of a strong rebound in the worldwide economy appear to have been dashed, at least in the short-term.
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