Tuesday, November 16, 2010
In fluid dynamics, a smooth linear flow developes chaotic turbulent flow when its dimensionless Reynolds number increases over the boundary phase. I think the world monetary flow is developing symptoms of entering a boundary phase, which may end in turbulence and chaos. For example, Ireland's young and religious population catapulted the country into an economic paradise. Irish GNP was higher than the British one. Yet now it appears that the miracle was much based on illusion and even more debt. Ireland is pulling down the euro versus all major currencies. The euro is once more losing its feet. Can the world monetary structure maintain its stability or will it collapse in chaos? What can a small saver do to protect its assets? Many may be weighting the this question these days.