Tags: Axel | Merk | Dollar | Suffer | Greece | Euro

Axel Merk: Dollar Will Suffer Because of Greece Crisis

Monday, 29 Mar 2010 02:27 PM

The dollar will not emerge stronger from the crisis in Greece, says Axel Merk, founder and president of Merk Investments and author of "Sustainable Wealth."

"The Greek tragedy is going to continue [and] there will be some ups and some downs,” he says.

Instead, the euro will survive the crisis from Greece and become a stronger denomination, he said.

"People should have much more confidence in the euro to stomach any shock that would come from Greece,” Merk told Yahoo! Finance Tech Ticker.

The crises in debt are dealt with differently in the United States compared to the European Union, he said.

In the United States, the Federal Reserve prints more currency, compared to countries in the European Union, which makes harsh cuts.

"Ultimately, people can print money much [easier] in the U.S. than elsewhere in the world and the U.S. dollar is going to suffer because of that," he said.

The euro’s recent drop compared to the dollar now poses a “great buying opportunity” for investors, he said.

However, since sovereign debt issues are emerging “throughout the world,” all currencies face a “less stable environment” in the future, Merk said.

The U.S. dollar is strengthening slowly, pushing oil prices lower, the Associated Press reported. Oil is traded in U.S. dollars and can make the commodity more expensive to purchase, which results in lower demand.

“The dollar still has the potential to appreciate rather significantly and on relatively short notice, and so for the moment, we would be cautious about being long energy," said Edward Meir, senior commodity analyst at MF Global in New York.

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