“So, nothing changed, in that the can was kicked yet one more time. Still, we may look back in ten years and see that this was the beginning of a very different Europe. Right now, the political leaders seem to be signaling, with the exception of Britain, that they are ready to sign on. I think they actually mean it. And those of us in the rest of the world had better hope they figure it out. A fractured Europe would bring on a crisis that would make the 2008 credit crisis seem like a walk in the park. Especially as the world seems to be getting ready for a synchronized recession.”
The above commentary is from John Mauldin’s weekly Thoughts from the Frontline letter, in which the long-time market pundit provided his analysis of the latest sovereign debt developments in Europe.
Mauldin began by summarizing his argument: “We have come to the end of yet another European Summit that was supposed to be the one to fix the problem. If you are confused as to what happened then you are not alone. Was it something we will look back on in ten years and say, ‘This was where it all started,’ or will it be viewed as just another meeting in what will prove to be a string of even more meetings? I will argue that both views are the correct answer, depending on your frame of reference.”
Additional highlights from the letter included:
“This week’s meetings gave us some rather important decisions. But what they did not do was give us a real solution. What we got was ‘a player to be named later’.”
“The important decisions? The first was that Germany finally got France to go along with its view of how the future of Europe should look. There would be no more bailouts of any type without serious reforms.”
“Leaving the eurozone is not an easy answer. It is a nightmare of Biblical proportions. Like the Hotel California, you can check out any time you like, but you can’t leave. Not without a paying hefty bill…And that bill would in all likelihood plunge you into a depression for a number of years. Very high unemployment. Unfunded pensions and much-reduced health care. Shortages of all kinds until some balance was struck on how to get ‘hard currency’ to pay for the things you want to import.”
“Germany has made the correct calculation that the only way they can make it in the future is to grow their economy significantly. And they can’t do it if they have to finance the weaker members of the eurozone. So they are in effect creating a ‘coalition of the strong.’ And if you want to play you will have to get your fiscal house in order. Germany will not kick you out, but you will lose access to financing if you don’t get your budget under control.”
The full version of Mauldin’s piece is available for free, but requires registration for his weekly letter:
http://www.johnmauldin.com/frontlinethoughts/a-player-to-be-named-later
Klondex Set to Advance Fire Creek Development
* Fire Creek is strategically located between the past producing Mule Canyon Mine to the north and the world-class Pipeline and Cortez gold deposits to the south.
* The property is readily accessible via Federal and state roads, is close to the electrical power grid, and is within 50 miles driving distance of two large mills.
* Klondex recently announced that its active 2011 surface drilling program continues to find new gold veins and to expand the scope of the resource at its Fire Creek.
