Telephone: 01539 725855 – no phone menus – talk to a real person today who can direct you to what you need

I think its fair to say that Europe is terrified that the single currency will collapse and that the results could be catastrophic for the Western World, with the likes of the UK and Germany footing the bill as countries like Greece and Spain default on their debts.

We would like to think that as a society we would learn from past mistakes but it is true to say we should never underestimate our ability to repeat the mistakes of the past.

In the 1870s most major industrial countries joined the gold standard, which used gold as the basis of the monetary system. This meant a fixed exchange rate regime similar to the effect of the Euro in mainlandEurope. This regime encouraged trade and international investment soared. Then came the Great Depression: Farm prices plummeted,Argentinathreatened to default and Baring Brothers of London collapsed!

The similarities between the Euro and the gold standard situation are striking. At the time it was viewed as virtually impossible that a country should leave the gold standard, but it did. In fact, almost every country left the gold standard during the Great Depression.

The question for today is whether the politicians will make the decisions needed before the markets force them to act?

More from our blog

  • Historically when saving for retirement, payments were made to a pension plan and when we finished work, the pension provider may have paid out a lump sum and then a pension (also known as an

  • Who can you trust?

    16 July 2012

    The fallout from the Banking crisis and subsequent scandals, including the Barclays LIBOR fixing scandal has sent shock waves throughout the whole financial services industry and the repercussions

  • Blog image

    As a proud Prestonian, I am looking forward to the Preston Guild celebrations in September when the city goes into festival mood celebrating the heritage, people, sports, trade, arts and culture of

© Financial Management Bureau Ltd 2011 - 2017. All rights reserved.
Financial Management Bureau Ltd is a limited company registered in England and Wales. Registered office: Shenstone House, Helsington, Kendal, Cumbria LA8 8AA. Registered number: 02089786