The brewing financial crisis.

2013 will be an extraordinary confluence of wrong thinking and financial mistakes. Government interference with markets is growing and this is creating great economic and financial strains.

EUROPE.
We have already read about the financial turmoil in Greece, Ireland, Portugal, Spain and Italy, but now we add one more to this toxic brew: France. The election of a Socialist government ensures that financial common sense will leave the Gallic shores. Sure enough, the French tried to raise confiscatory taxes on top earners, causing an exodus of capital, along with  those who earn it. While, a French court struck down the infamous 75% tax on incomes above E1M/yr, this just adds to the confusion. What's the problem? French banks, you see, are an important linch pin in world trade and with France increasingly vulnerable to the stupidities that plague Socialist countries, the reputation of these banks is suffering. You will hear more of this as the trend unfolds.

JAPAN.
Japan has elected a government that promised to print money to reduce the value of the YEN. The stupids that now run the country believe that destroying the value of their currency will help export and thus, their economy. Japan's PM Abe is on board with this and so is their Finance Minister Aso. What these people do not realize is that a cheaper currency might help exports, but it makes imports more expencive. And Japan imports a lot of things, including oil. With their atomic power still in the dog house, Japan must import more oil.Also, Japanese banks are also involved in financing international trade and a falling currency will hurt these banks. Japan has a shrinking population, hence their push for robotics.

THE UNITED STATES.
Unfortunately, the US has also fallen into the category of countries where stupidity had overtaken the population. BHO and the Democrats had solidified their hold on America, which is bad news for the Country and the economy. The Fisal Cliff will send us deeper into economic stagnation. US credit rating will suffer and we will slip into recession. Bernanke will increase printing, but without increasing money velocity, the printing will heve little beneficial effect. If Larry is correct, gold will resume its climb as investment opportunities grow scarce.