Chaos in Europe

My take on the euro situation is that the EU is in a catch-22. If they bailout Greece (which it looks like they most definitely will), what signal does that send to the rest of the Eurozone, and in particular other high risk nations like Ireland, Italy and Spain? Will bailouts become the norm? What signal will that send to outside nations and investors about the credibility of the currency, if not the entire region? There is also potential inflation concerns to be worried about.

Yet, what signal does the EU send if it allows Greece to default? What will that say about the stability of the euro?

Here is what Sveder van Wijnbergen had to say in a recent AP article on the subject:

"Greece in itself is not a big thing," said Sveder van Wijnbergen, of the Free University of Amsterdam, who says Athens' budget shortfall of euro5 4 billion ($75 billion) is small change by European standards. "I'm worried about what sort of message we give to other governments."

In my view this is a short-term sure thing if I've ever seen one. I'm going to buy some DRR on Tuesday and possibly move some of my gold exposure to this area as well.