Jim Mellon, the investor who correctly forecast the last economic recession, now predicts “years of turbulence” for the European Union (EU) and the “breakup” of the euro currency.
Mr. Mellon — referred to be some as ‘Britain’s answer to Warren Buffett’ — has concluded from his assessment of the current economic climate that Britain is “better off outside the European Union in a comfortably appointed lifeboat in the English Channel, as the Euro Titanic sinks to the bottom of the ocean.”
The reason Mr. Mellon’s assessment is worth listening to is because he was one of the few economists to forecast the most recent economic recession, correctly predicting that the U.S. housing crisis would be the “trigger” for that in his book ‘Wake Up!: Survive and Prosper in the Coming Economic Turmoil’.
Mr. Mellon sets out what he says are the clear reasons for the impending collapse. France and Italy are in “debt traps,” meaning the are not able to grow their way out of evermore expanding debts.
Meanwhile, structural reforms are not available to a French government prevented from employing such measures by striking workers, and in Italy the banks are in “perilous trouble”, as reported previously by Breitbart London. For these reasons, Mr. Mellon says:
“France and Italy are probably going to be the key factors in the implosion of the Eurozone.”
Mr. Mellon concedes that “most people don’t talk about it,” but adds “most people didn’t talk about the coming U.S. housing crisis in 2006.”
He gives it about three to five years before a “big problem in the bond markets in Europe” which will lead to the collapse of the euro and a “continent-wide depression.” Merely being outside the Eurozone will not be enough to shield us from harm at that time, Mr. Mellon says, as:
“For sure, we will be invited or forced to join in a bailout no matter what the various treaties and so forth say.”
Evidencing this he cites the examples of the Greek and Irish bailouts, and extra money paid into the EU despite Prime Minister Cameron’s pledge that such payments would be made “over his dead body.” He states that “we can’t believe anything that Cameron and Osborne say about their future actions in regard to solidarity with Europe if France and Italy go bust” — something he believes is “a certainty”.
Mr. Mellon does identify a potential for rejoining a “genuinely reformed European Union post that event”, but he sees the UK as being “better off” outside the EU.
Concluding with his “bottom line message as a businessman, as an economist, as someone who has got a good record in forecasting” he reiterates that staying in the EU will leave us in “deep trouble” and “sinking with the European ship.”
Follow Sarkis Zeronian on Twitter: Follow @SarkisZ or e-mail to: email@example.com