The EUR has been in a bull market since 2002 but the economic and political fundamentals of Europe are not looking too good these days…and there are some dark clouds on the horizon for this currency when you consider the broader global socioeconomic framework....The EUR may very well rally further in the short and intermediate term, but fundamentals determine long term trends, and the long term trend for the EUR is reaching a turning point. I think it is a safe bet that a few years from now the EUR will be significantly lower, and looking farther out it is not a stretch to say that the EUR will be disbanded when countries like Italy leave it so that they can go back to depreciating their own currencies.
The dramatic speed with which the credit crisis has taken hold of the global markets has sped up the EUR's future demise. In light of this I offer some new predictions: The EUR will be at par with the USD by June 1, 2009. Italy will be the first country to withdraw and the EUR will collapse and be disbanded no later than December 2011. -John Bardacino