The Fed rate hikes are toxic for both the Euro and the Yen. The people of both Europe and Japan face losing a great deal of their wealth if the Euro and Yen continue to fall. In the last newsletter, we outlined the de-stabilizing issues facing Japan.

The EU however is different in the fact that it has never been stable! I have written since the creation of the EU that it was structurally flawed. I felt that they may be able to form a central bank and common monetary policy (ECB), but you cannot have independent unenforceable sovereign Fiscal Policy and no Treasury bond issuance. It is only a matter of time before the proliferate southern sovereign spenders bring down the system. The EU Energy Crisis may now be the final overdue catalyst!