Are You Expats Ready for 2012?

First off, a very happy and prosperous New Year to all! And let us not forget, a happy tenth birthday to the prematurely conceived €uro. For those of you who are still navigating the fiscal waters of last year’s calamities, save some energy, because you will need it now more than ever. Things are about to get interesting for expats all around the world, including those of us who have been watching the demise of the US economy, followed by the Europeans’ massive problems.The good thing of course is that with the troubles in Europe, the weakening of their common currency and general lack of faith, suddenly the US Dollar looks like an attractive venue for parking very large investment funds. The coming three months will bring an unprecedented hundreds of billions of €uro-denominated sovereign bonds come due to be refinanced. Spain’s new Prime Minister Mariano Rajoy already has publicly stated that his government’s target of a 6% budget deficit will be more like closer to 8% (in plain language that means 10%—12%). It is fully expected that Spain will re-enter the recession it never really left, and that extremely painful austerity measures will have to be put into place. "This is the beginning of the beginning," government spokeswoman Soraya Saenz de Santamaria said.
Its neighbor, Portugal, is in a very slow recovery process with an uncertain outcome, while the sickest child of Europe, Greece, is lying on the steps of the Acropolis bleeding to death as a result of outrageous fiscal mismanagement. Say goodbye to the Euro and hello to the new Drachma.

But let’s go back to the Iberian Peninsula: The UK government is working feverishly on contingency plans to repatriate its citizens, well over a million expats in the two countries of Spain and Portugal that occupy the peninsula, in case there will be a total financial meltdown in those charming but unfortunate nations. I compliment the UK authorities for dealing with a potential humanitarian catastrophe, and recognizing that in the event of a complete failure of the banking system, the ATM’s will likely not work and the pensioners will not be able to withdraw their savings and monthly disbursements, leading to much more than “an inconvenience!”

My immediate suggestion to those expats who will potentially be affected is simple: Pretend the Third World War is coming, hoard staple food and British £. Turns out the British government was much wiser than many of your fellow citizens gave it credit for when they decided to not join the European currency union. Personally I am not sure if they had any inkling that their inaction would save the UK from greater financial conundrums than it is presently suffering from, but all is well that ends well.
Now for a few moments, let us pretend we are three months into the future, and it is April Fool’s Day: A prominent French economist by the name of Christian Noyer, current Governor of the Bank of France, a former member of the Executive Board of the European Central Bank (ECB), and current Chairman of the Bank for International Settlements has taken an end of the year article published in the Parisian Journal du Dimanche, to pronounce that the €uro ‘could’ become the world’s leading currency in the next decade, IF only the leaders of the single currency bloc succeeded in tightening fiscal integration. He was of course referring to the historic dud heard around the world, emanating from Brussels on December 9, when British Prime Minister David Cameron torpedoed the entire effort by casting an early morning veto to protect the City of London’s lead standing in the European and global financial world. The decisions made in Brussels had the effect of having Standard and Fitch issue an analytical opinion stating their doubts that a comprehensive solution can be found, urging much stronger action from the ECB.Expat, US resident, Eurozone resident and all other world citizens: The watchword for the year is UNCERTAINTY!I encourage you to write to me, jamie@expatdailynews.com with any questions or suggestions you may have, and if necessary, we can establish a voice communication via Skype. Disclaimer: I am not in any travel related business. My advice is based on my own experiences, and is free of charge. (Donations accepted). It is always my pleasure to act as a beneficial counselor to those who are seekers of the next adventure.Jamie Douglas is an Adventurer, Writer and Photographer with an amazing array of Nikon equipment, and a lifetime of experience traveling and documenting. To contact him for assignments, email: jamie.douglas [at] yahoo.comSee more expat articles by Jamie at

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