http://thetrawl.magnify.net/video/OECD-calls-for-urgent-action-to
This video from the OECD looks at the growth prospects for next year. Frankly it does not look good. Depression across Europe looks to be a done deal, and that is without taking into account any worse case scenarios involving the euro.
The OECD has stated that it believes that even a single country leaving the euro would have very serious consequences. These could include any number of bankruptcies. This would be “apocalyptic” according to the Polish foreign minister Radoslaw Sikorski.
Apocalyptic is clearly an exaggeration. For the man and woman in the street how much extra hardship they could be in for if there was a round of debt defaults is debatable. One thing is for certain though, that even the prospect of this happening is not helpful to the recovery of the economy.
Given that there is much riding on the success of the eurozone, the international commitment to the bailout funds has not been outstanding. One of the ongoing debates is whether European debt should be consolidated into one. This could then be sold as a product, a so-called ‘eurobond’.
The bond market looks set to see changes over the next few weeks. For the amateur investor it is a nightmare scenario. There are just to many variables, and on top of that a lot of the latest best assessments of what is happening are not available to ‘civilian’. The best bet is likely to be some form of ‘damage control’. Those with assets sufficient to consider private wealth management may find that expert advice can keep them from getting burnt, but 2012 is going to see a lot more winners than losers, and now is no time to go rushing into any kind of investment without knowing the full facts and having at least the bare bones of a backup plan.