Socialist Governments Create Inflation

Pinnacle Digest writes: In this article by Daniel Amerman, the implications, from a market and economic standpoint, of socialist governments taking over the west are examined.

The election of Francois Hollande in France will have major implications on the global economy and stock markets. Europe’s debt troubles have been hurting the markets for two years now and it appears everything Merkel and Sarkozy worked so hard to fix, is in jeopardy.

The austerity measures put in place for the Eurozone are facing some serious backlash from voters. The austerity measures cost Sarkozy his job given that Hollande promised to spend the country out of its financial hardship and in the process, lower the retirement age to 60 - despite most other nations raising the retirement age out of necessity.

Merkel appears to be in jeopardy of losing power to a more left leaning party now as well. On top of that, Greece is at its breaking point with austerity measures and is likely to elect a government willing to promote growth immediately - by way of spending.

The trend is starting to form in Europe. Voters want a quick fix and the only parties willing to lie and claim they can provide that are socialist groups. Soon enough the Eurozone will be entirely socialist based as voters get tired of waiting for growth. Sometimes voters need to realize that much of the problems we find ourselves in today are self-inflicted and we need to take our medicine. Unfortunately, no one is willing to go through hard times to fix the problem - so socialists with promises that will be impossible to deliver are elected.

The mindset of socialists is to spend our way out of debt and this is going to create dangerous levels of inflation. Just give it time.

Click here to read Daniel Amerman’s revealing article on the subject