Saturday, February 11, 2012

Europe is freezing but the Euro isn't yet..

The Deep Freeze in Europe is not letting up.  The reported death toll is now up to 540.
UPI: Extreme weather grips Europe
LONDON, Feb. 10 (UPI) -- Winter weather conditions wreaked havoc across much of Europe Friday, with travel delays, school and public office closures and deaths, officials said. 
Central and Eastern Europe got the worst of the recent weather, with heavy snow and subzero temperatures that have claimed about 540 lives, The Daily Telegraph reported. Temperatures were forecast to plunge to about minus-40 F in the mountains of the Czech Republic during the weekend, the British newspaper said...
About 70,000 people in Serbia were isolated by deep snow that has inundated the Balkans, forcing the use of helicopters to fly in food supplies...
 About 20,000 people in Romania, where snow up to 13 feet deep prevented travel, were dealing with dwindling food supplies, as well.. 
In Ukraine, the worst-affected country, about 140 people have died, while more than 3,000 people have been treated at hospitals for frost bite and hypothermia.
You would think that the loss of economic activity from the crippling weather coupled with increased energy prices due to shortages would weigh down leading economic indicators and investors would become even more skeptical of the Greek bailout and the long term prospects of the Euro. But for some reason there is no sign of cautious skepticism here. 
Bloomberg: Euro gains Against Major Currencies
The euro gained against the majority of its most-traded counterparts as the central bank saw signs of“stabilization” in the region and investors speculated Greece would convince European leaders to release its aid package.
The euro held on to weekly advances against the dollar and yen as Greek Prime Minister Lucas Papademos secured approval from his Cabinet to submit laws for new budget measures designed to secure a second rescue package.
I think that is a bad sign in a way.  Maybe it is so bleak right now that no one wants to be the first to bail out and start the mass exodus that leads to panic and calamity.  The economy is based on confidence in the currency.  Maybe it is better to feign confidence and take a tactical loss later instead of trying to cut the losses now and starting an avalanche. 

Oh and pray for some nicer weather.

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