Philipp Bagus on moral hazard in Europe, inflation, and gold

Subscribe to our newsletter at http://www.goldmoney.com/goldresearch. In this video Philipp Bagus, Assistant professor of Economics at Madrid's Universidad Rey Juan Carlos and author of The Tragedy of the Euro, talks about moral hazard in the eurozone, inflation, and gold. According to Bagus, central banks' fear of deflation will cause them to do everything to prevent it from happening -- including printing a lot more money. He expects that the confidence in the euro can be sustained for a while to come which is why he expects inflation to rise only slowly. Bagus talks about the problem of moral hazard within the eurozone. There is an incentive by governments to impose the cost of government spending on the holders of the currency. In the proposed "Eurobonds" Bagus sees the explicit manifestation of the implicit redistribution mechanism that already existed from the beginning of the European Union. He states that without reforms a Greek exit from the euro wouldn't do them any good. For the future of the EU he sees more centralisation in the realm of a fiscal union, which could be to the detriment of civil liberties. Gold is slowly regaining importance on the international stage and should be used by people to protect themselves in the event of a currency crisis.

This interview was recorded on November 15 2011 in Madrid.

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News & Politics

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• inflation
• central banks
• ECB
• Greece
• moral hazard
• EFSF
• Eurobonds
• bailouts
• Philipp Bagus
• The Tragedy of the Euro
• GoldMoney Foundation
• Madrid
• deflation
• euro
• Germany
• gold
• gold standard