With the Euro-zone bank-run accelerating on a daily basis, sapping liquidity out of the system, and financial amageddon coming closer, the end of the Euro currency and the total economic collapse of the Euro-zone countries is coming closer and closer by the day, unless of course they engage in massive money-printing to support the collapsing countries and banks.
Money printing can either be done directly by their own central bank ECB or indirectly by the US Federal Reserve via SWAPS agreements. Many europeans are very reluctant to engage in money-printing because of their qute recent experience with hyperinflation/currency collapse in both France during the French Revolution and the Weimer Republic hyperinflation episodes in the 1920's. Because of the overwhelming objection by the public the European governments may have to do a discreet money-printing via the Federal Reserve SWAPS agreement. The concept is the same is the same but most people would never notice it.
Massive money-printing out of thin air is highly inflationary and could easily lead to currency collapse/hyperinflation. When faced with the choice of a total collapse now if they do nothing, or print and delay the financial amageddon, the choice for the politicians and the Keynesian economists who currently dominate the mainstream economic landscape is clear, and that is to print and print money until the total system implodes.
Here is a link to youtube video on the French hyperinflation episodes 1 and 2:
http://www.youtube.com/watch?v=7zvNV-vkEzc
http://www.youtube.com/watch?v=U4aRuiO1OuQ&feature=related
http://www.youtube.com/watch?v=U4aRuiO1OuQ&feature=related
Money-printing program is extremely bullish for the price of gold and silver as these two metals are time-tested alternative currency that cannot be debased by governments, and that is not only a hedge against inflation but also a store of value against sovereign and currency collapse.
When they start to engage in massive money-printing, which they will as there is NO other choice, it is either print & delay the collapse or not print and collapse now, the price of gold and silver should start to break out of the current consolidation zone and starts to break out to the upside again.
Key price level for gold is a clear break above US$1,800
Next upside target for gold is between US$2,400 - $2,500per ounce, and it can get there very very quickly.
Key level for silver is about US$44 per ounce. Silver pullback since May has taken the form of an equal leg ABC zig zag. A break above wave B high ($44) of an ABC correction implies the pullback is over, and that the next trending leg up is underway.
Once silver breaks out of the current consolidation, its next upside price target is US$75 per ounce.
