Investors back gold as fears over eurozone grow.
Daryl Jackson, News Editor
20 Feb 2017, 2:03 p.m.
It's being widely reported that the former head of the US federal reserve has said he has 'grave concerns' about the future of the euro adding that he fears it may be on the verge of collapse.
Alan Greenspan, who is 90, was the chairman of the US federal reserve from 1987 until 2006 and predicted the financial crisis that followed in 2007 in America and in the United Kingdom.
Mr Greenspan is alleged to have said that it is now only a matter time, in his opinion, before the eurozone collapses and as a result investors are said to be turning to gold in an attempt to reduce their losses.
In an interview with Gold Investor magazine he said: "The European Central Bank (ECB) has greater problems than the Federal Reserve.
"The asset side of the ECB’s balance sheet is larger than ever before, having grown steadily since Mario Draghi said he would do whatever it took to preserve the euro.
"And I have grave concerns about the future of the Euro itself.
"Northern Europe has, in effect, been funding the deficits of the South; that cannot continue indefinitely. The eurozone is not working."
A recent report suggested that 19 of the countries which adopted the euro in 2002 are facing debts that are unprecedented.
There is another financial crisis in Greece which has reportedly seen people withdrawing cash from bank accounts indicating that there is preparation there for a crash.
Meanwhile, Europe's oldest bank, Banca Monte dei Paschi di Siena said its net loss for the fourth quarter widened to EUR2.53 billion, mainly hit by large provisions for bad loans.
The bank said it set aside EUR2.45 billion for bad loans in the last three months of last year, compared with EUR577 million for the same period a year earlier.
Mr Greenspan said that investors are back to safe havens including precious metals because there is no trust in the banking system.
He added: "I view gold as the primary global currency.
"Today, going back on to the gold standard would be perceived as an act of desperation.
"But if the gold standard were in place today we would not have reached the situation in which we now find ourselves".