Feb. 14, 2017 9:37 AM ET
Summary
- There were already enough countries contemplating an EU exit.
- Germany would be the nail in the coffin. Their repatriation of gold should be concerning.
- The end of the EU would spike interest rates and risk markets and economies.
German Elections, EU, ECB and Immigration
Chancellor Angela Merkel is struggling to get reelected in September amid intense criticism from right-leaning parties. Merkel backs the ECB and their bond-buying.
The German election is expected to be held September 24, 2017, although it can happen anytime between August 27 and October 22.
As of February 10th, Merkel's party the CDU was polling at 34%. Martin Schultz of the Social Democrats has been gaining on Merkel now at 22.6%.
The Social Democrats have proposed a points-based system for allowing immigrants based on skills and education. Martin Schultz is a former European Parliament President, and is believed to be pro-EU, although he acknowledges that the EU is at risk following Brexit.
We'd guess that Germany changing the terms of immigration could be an issue for the EU. The EU would not negotiate changing immigration rules with the UK. Any demands from a country about changing immigration policy could be a deal breaker for the EU.
Even though Schultz was president of the European Parliament his demands for immigration changes could risk German's EU membership.
German Gold Move Hint To Dexit?
Does Merkel see the writing on the wall?
The news that the Bundesbank is repatriating its gold reserves three years ahead of schedule has led to talk of an exit from the euro (NYSEARCA:FXE). Germany has already moved 583 tons of gold (NYSEARCA:GLD). This could be a sign that Germany is intending to use the gold to back the printing of Deutsche marks. If so it means they are preparing for the fall of the euro.
Source: Seeking Alpha
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