While much media attention has been geared toward Greece, Spain and Portugal in recent weeks because of their deficit problems, they aren't the only countries that could end up facing sovereign debt woes in the foreseeable future.
A report in the UK's Guardian newspaper said that the United Kingdom's deficit is projected to be 12 percent of its gross domestic product, which would be the highest of all 27 members of the European Union - including Greece.
The newspaper noted that Greece expects to bring its own deficit down to 9.3 percent of GDP, and that the upcoming British elections are being seen as an important opportunity for the country to start getting its fiscal house in order.
Budget problems have already resulted in Spain, Portugal and Greece having their credit ratings downgraded, which will result in higher borrowing costs for those countries while also potentially undermining confidence in the euro.
The report also cited concern among some economists that the UK could join these countries in having its debt rating lowered if sufficient action is not taken on the budget deficit.
Concern about a future debt defaults has shaken the value of the euro in recent days, while also giving investors a good reason to consult with silver and gold dealers about traditional safe havens like precious metals.
Looking ahead, precious metals could be a good idea to invest in because a major credit default by a European Union member could have serious financial repercussions on world markets. Such a setback could also undermine worldwide confidence in the economic recovery, raising the specter of a double dip recession.
In the United States, officials have long dismissed the idea that the government would default on its own debt obligations. However, as the national debt makes its way toward $14 trillion, the government is already spending hundreds of billions of dollars per year just to finance the national debt.
With no end in sight to massive deficits, members of Congress may not have the political will that would be needed to bring the budget under control and begin paying down the national debt. As the national debt approaches unsustainable levels, investors in precious metals may be well positioned to ride out uncertainties.
