Re: A Golden Solution for Europe's Sovereign-Debt Crisis
The author, Stephen Fidler, is off the mark, but the significance of his article is that he advises using gold as a solution. The over-indebted countries do not need to find ways to continue to borrow. They need to stop borrowing...period. A nation that put its gold as collateral in a well-respected third party depository might be able to borrow more and at lower cost...but that tactic would only get that country further into debt...and it could mean losing its gold reserves entirely. This solves nothing long term. The over-indebted countries need to slash their budgets, slash their onerous regulations on business and labor, and somehow institute sound money, even if it means leaving the eurozone and instituting their own gold-backed currency. Now THAT would be a good use for all that gold.