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Europe’s Serious Problems Add to Global Financial Instability Woes

ATTENTION EDITORS - VISUAL COVERAGE OF SCENES OF INJURY OR DEATH - Bodies are seen on the ground July 15, 2016  after at least 30 people were killed in Nice, France, when a truck ran into a crowd celebrating the Bastille Day national holiday, July 14, 2016.   REUTERS/Eric Gaillard    TEMPLATE OUT.

With European political and economic powerhouses France and now Germany struggling with Islamic State terrorism and the second greatest economy in Europe Great Britain suffering from slow motion financial meltdown after the Brexit vote, you can not take financial stability in the world for granted any longer. These geopolitical crises (and others like the just failed Turkish coup) remind you that you need to have a financial backstop for your investments and retirement funds. Gold has always been and remains the best answer as a safeguard against these and other as of yet unknown threats. The ultimate safe haven protects you from political, financial, and inflationary instability all at once.

France on the Verge of a Nervous Breakdown or Even Civil War?

France is suffering from three massive and devastatingly successful terror attacks in just over a year, each one seemingly progressively worse than the last one. Without a doubt, this is a harbinger of instability for the developed world. Expatriate residents in France have reported that this third and latest example of carnage, this time in Nice on the French national Bastille Day, has pushed the French to the border of serious escalation. What do you get when you combine an increasingly isolated, desperate, and radical Islamic immigrant population with an ever more popular right wing anti-immigrant political group in a nation awash in guns— the explosive and poisonous recipe for a brutal civil war. It may at first sound far fetched to think that the traditional French could turn on their Muslim immigrants, but consider what one senior French intelligence official Patrick Calvar told a committee in French parliament last week before the most recent terrorist attack in Nice occurred. He stated that only one more such incident could lead to a bloodthirsty civil war in France.

This is a troubling and serious possibility when the third largest economy in Europe and sixth largest on earth stands poised on the brink of a second French revolution-like series of massacres. Sadly the elected government does not seem to be able to do a thing to stop the so far radical instigated violence. Just last week, French Prime Minister Manuel Valls infuriated French citizens across the country with his suggestion that they should simply “learn to live” with the ongoing threat and brutality of terrorism. It goes a long way to explain why the likes of the National Front, Marine Le Pen’s anti-immigrant party, is doing so very well in local elections and the national polls. She only fans the flames higher and worse with such explosive comments like the one she made just last week. “The war against Islamic fundamentalism has not yet begun. Now it is necessary to urgently declare it.” You can understand where she and her sympathizers are coming from when you look at the terrorist death toll data for France over the last nearly five years. Starting with the March 2012 attack on Toulouse that killed three children at a Jewish school and four French soldiers outside the barracks, there have been another shocking 14 terrorist attacks in France that have caused over 250 deaths and 600 injuries.

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Islamic State Begins Targeting Germany

Let’s hope that more of the same is not in store for Germany, which just suffered from its first Islamic State claimed terrorist attack yesterday. A 17 year old Afghan immigrant assaulted tourists on the train near the Southern German city of Wuerberg. He came to Germany unaccompanied as a minor and was living with a foster family in the area. With an ax and knives he severely wounded four people on the train before attacking police and being shot. The local police found a hand painted IS flag with his belongings. The man shouted God is greatest (Allahu akbar) as he attacked.

This first attack in Germany answered the September of 2014 call from Islamic State spokesman Abu Mohamed al-Adnani for supporters and soldiers to take up knives, stones, or vehicles as weapons to kill unbelievers. It remains to be seen if this was simply an isolated assault on the largest economy in Europe and fourth largest in the world or the beginning of many more to come. In either case it is troubling for the prospects of developed world stability and safety.

UK Credit and Government Finances Under Pressure

Rounding out a perfect trifecta of threats in economically important Europe are the new financial problems plaguing Great Britain since their stunning June 23rd Brexit Leave vote in the national referendum. Britain’s credit rating has been downgraded two notches at once since then by the major sovereign credit ratings agencies. Moody’s just announced that the creditworthiness of the U.K. is under additional downward pressure for the future in the wake of its choice to leave the world’s largest economic block the European Union. Moody’s said, “Uncertainty surrounding the UK’s withdrawal from the EU will likely affect economic growth and weaken government finances.” The British Debt to GDP ratio is now likely stagnated at a dangerously high 90%. A potentially severe recession for Britain in the coming year now looks increasingly likely. This poses numerous risks for the world economy at large as London remains the global center for banking, forex, precious metals, and insurance. Now is the time to hold your gold tighter than ever with the latest problems and rising instabilities in the fourth, fifth, and sixth largest economies in the entire world.

W. D. Crowder

W. D. Crowder is an American published author with decades of experience in financial writing. He specializes in many areas, including: investment, economics, international relations and more.