Montreal, Canada

As the EUR continues to consolidate this month and drifts to new lows for the year, the U.S. dollar is rallying hard. The dollar is now the safe-haven in Europe – the most ridiculous assumption because the U.S. currency is beset by far more net debt than any European country, including Greece. The United States will have its day of reckoning in the future as markets eventually shift their attack on Treasury debt and force interest rates much higher.

But for now, let's keep our focus on the EUR.

The Swiss franc is trading at an all-time high vis-à-vis the EUR this morning as traders flock to the relative safety of the CHF on European cross trades. The franc has gained 6% since December 1st against the EUR, which marked the peak of the single currency's rally off the March 9 lows.

Over the same period the Norwegian kroner, the only surplus currency in Europe (budget surplus-to-GDP of 10%) has rallied a cumulative 5.6% or about the same as the Swiss franc against the beleaguered EUR.

Is the Swiss franc an optimal haven for EUR-based investors? I think not.

The Swiss National Bank, or SNB, has been actively dumping Swiss francs since March 2009 to depress its currency versus the euro-zone – its largest trading partner. Switzerland has repeatedly intervened on foreign exchange markets since last year selling francs for EUR to stem the rising tide of deflation; a strong currency is the last thing the Swiss want (or any country for that matter) as it trims export competitiveness.

The tide of EUR selling, however, has now overwhelmed the SNB. Switzerland can dump only so many francs on the open market because the currency is not as heavily traded as the EUR.

This decade, I believe, will be a difficult one for the EUR, the U.S. dollar and the Japanese yen. All three majors offer poor relative and absolute values and are increasingly burdened by soaring deficits.

The EUR might be the worst drunk at the bar in the 2010s since the odds are increasing that Germany will not bail-out Greece and other weaker members; instead, the International Monetary Fund (IMF) is likely to come to the rescue and will impose harsh austerity measures on those on the verge of default. Austerity is not a fun word. The last thing Europe needs now is less spending, which implies more, not less, deflation.

Whereas the SNB is dumping the CHF, the Norges Bank (Norwegian Central Bank) is not selling the krone. This is one reason why I like the NOK. The other reason – and far more compelling – is that Norway is home to the only example of currency sobriety in 2010 with a budget surplus around 10% of its gross domestic product.

No other European country comes close to Norway – not even Switzerland, which harbors a negative budget balance-to-GDP ratio of 1.3%. Germany is worse at -4.6% of GDP (data courtesy of The Economist).

Provided crude oil prices don't collapse – and I don't think they will any time soon – the NOK should form the basis of a EUR safe-haven strategy along with gold. The latter has indeed disappointed amid the Greek debt crisis but at some point will muster a new round of strength as more investors and central banks discover that our post-1971 global exchange rate system is dysfunctional, highly volatile and deteriorating ahead of the next global crisis down the road – probably a currency crash or a series of currency devaluations in the major markets.