October 10, 2017

Political Upheaval

BY Tradition Gold

There is political upheaval brewing in Spain.  In fact, it has been brewing for quite some time and seems to be at a boil.  What’s more, there could be a major announcement on Tuesday October 10th that could throw the markets into a tizzy as well – everything from equities, to currencies, and gold.

 

The Catalan region of Spain is in the Northeast and has its own history, culture, and its own language.  Because of these unique characteristics, the people of Catalonia have long-held the belief that it should be an independent state.  This has been an issue for quite some time, but with others in the EU threatening to leave, such as Greece and most assuredly Britain, it has gained serious traction.  Just last week the people of Catalonia went to the pols to vote on weather they should leave Spain and somehow managed to vote 90% in favor of independence, as they were beaten bloody by the Spanish national police.

 

Other threats have been made.  With the possibility of a declaration of independence being made on October 10th, Spanish authorities made a veiled DEATH threat against the leader of Catalonia!  “Let’s hope that nothing is declared tomorrow because perhaps the person who makes the declaration will end up like the person who made the declaration 83 years ago.”  Lluís Companys i Jover (21 June 1882 – 15 October 1940) was the President of Catalonia (Spain), from 1934 and during the Spanish Civil War.  He was a lawyer and leader of the Republican Left of Catalonia (ERC) political party. Exiled after the war, he was captured and handed over by the Nazi secret police, the Gestapo, to the Spanish State of Francisco Franco, who had him executed by firing squad in 1940.  Companys is the only incumbent democratically elected president in European history to have been executed.

 

To make this threat is simply amazing and if it comes to pass, we would expect major market chaos in the European Union, which would certainly spill over to the US and other regions.  Let’s hope if doesn’t happen, but if it does, the best defense for your portfolio will be gold in our opinion.