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Is Germany Next? Investors Flee Madrid's CDS For Berlin

Is Germany Next? Investors Flee Madrid's CDS For Berlin

Posted by Charleston Voice, 05.24.12

Having had a start centuries ahead of the United States, you'd expect the Europeans to have learned that tyrants will defraud you. Why should American ignorance of just their own experiences in a short history have a different outcome? C'est la vie.

As for us, we'd grab all the German (or, Spanish, Swiss, French) gold 10 and 20 marks coins we could get, and walk away.

Thursday, May 24, 2012 4:37 PM EDT

By Benjamin Reeves

At more than $1550 US dollars per ounce
current gold value, the base value of the
10 mark coin is more than 0.1152 x $1550 = $178

Investors are making a "flight to quality" faster than a runner chased by a bull through the streets of Pamplona. Investors are increasingly looking for alternatives to credit-default swaps (CDS) on Spanish national debt and on Europe's primary CDS index and moving it to German CDs, a trend which indicates higher expectations that periphery nations will be unable to repay their debts and a lack of confidence in the political will of the economic union...

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