Inflation and hyperinflation could be staring all of us in the face very soon.

Top Banker Warns: Expect European Union to Print Euros

The EU has already said it will soon conduct U.S. style stress tests on its own banks. Now a major European bank’s currency chief warns that the political and economic union of nations will be forced to print fresh euros as well, raising the specter of massive inflation there and rounds of damaging competitive devaluations worldwide.

The European Central Bank will have to print and then sell euros to protect member countries’ exports, says David Bloom, global head of foreign exchange strategy at HSBC.

Bloom told cable network CNBC that, despite disagreements among the 16 countries that use the euro “there's one thing that they have in common, the euro."

The currency’s strength hurts member countries by making their exports more expensive in foreign currency terms. After touching a low of $1.26 in March, the euro has jumped 8 percent to $1.36.

When the euro reaches $1.50, the ECB will have to act, Bloom argues.

I think that there would be far greater resistance in the ECB than Bloom is crediting, unlike most central banks, the ECB is not responsible to an elected government worrying about being re-elected.

Since its inception, the ECB has shown the strongest backbone in its resistance to inflation of all the major “Central Banks” – its major brief is to control inflation in the Euro zone.

In my view Germany, which is by far the major economic force in the “EUR” countries, would very strongly resist any move to print money (and would be supported by the French).

German citizens, out of all of the citizens in western countries, are probably the most paranoid about inflation, they are extremely conscious of the effects of hyperinflation in the Weimar Republic in the 1920’s.

JimboPSM wrote:In my view Germany, which is by far the major economic force in the “EUR” countries, would very strongly resist any move to print money (and would be supported by the French).

German citizens, out of all of the citizens in western countries, are probably the most paranoid about inflation, they are extremely conscious of the effects of hyperinflation in the Weimar Republic in the 1920’s.

I agree with that.

I only wonder how two countries will stand up successfully against the rest of them.

who read "Iceland is to become the next country to join the EUC" - well, that's bl0ody handy as it was the first country in Europe to go more or less bankrupt, ever.....by the time a trillion dillion barrels of oil is finally discovered under that country, we will all be running around in hydrogen cars anyway........