When Dave and I met over the weekend, as usual, our conversation went all over the place as two elderly sufferers of ADHD is wont to do. One of the things we were talking about was the price of oil at over $100 per barrel is not having that great of an effect in Europe because the Euro is over 50% stronger than the greenback. In essence, while we are paying the higher price, because of our devalued currency, the Europeans are paying the equivalent of $66 per barrel. Obviously, this is a tremendous benefit to them. But how long can it last?
Forbes magazine has this article which is predicting the end of the Euro within three years. The interesting thing about the article is its prescription to horde dollars because the Euro will suffer one heck of a sell off if and when Spain, Italy and France bail on it. The effect on the hording will rally the dollar, making our imports cheaper and our exports more costly.
I have a bucket with old currencies that I thought were worthless since the creation of the Euro. Maybe I should dig around and find them again. While they were often quite colorful and interesting, they could be worth something once again.