This article is under speculation, because this is what it is at best, at the moment.
There is growing concern that we might be seeing a new world currency being developed at the moment. Continued euro financial crisis could inevitably put the global finance sector into a tail spin. And why would we say that?
And this is why. There are 23 countries in the European Union, and almost all of them are in a financial crisis of some sort; Greece, Italy, Spain, Finland, Ireland, Portugal are the bigger economies to bear the burden of the crisis so far. Imagine this, the 10-year treasury notes from the Government of Italy have a yield of 7.30% (as of today), and Greece with a whopping 30.71%. Compare this to an individual in Canada, who can get loans at prime + 2% (5.5%) at the major banks without much problem. What does this mean? This means that an individual in Canada is more capable of running their own finances, and is more able to pay back the loan taken, as compared to a government that can raise taxes, and implement different policies to increase its revenues and decrease deficits. In the end, this is just absurd. As mentioned in our earlier posts (here and here), CAPM is dead, and this is the proof that no government is safe from such a systematic failure and a run on their banks.
So what is next in the play?