February 8, 2012

Greece gets an ultimatum from EU but there is life after the euro

Posted in Irish Independent · 204 comments ·
Share 

Are the Germans about to give up on the Greeks? Are they about to allow the Greeks to leave the euro? It certainly feels like that. The EU has just issued an ultimatum to Greece. All the talk of a friendly deal is gone. Greek politicians say they need more time to examine the austerity attached to the release of the next tranche of the €110bn loan.

But austerity isn’t working and the Greeks know it. Athens adopted the troika’s strict budget targets in May 2010 — nearly two years ago — in return for a €110bn rescue. Last year the Greek economy shrank by 6pc and the country’s budget deficit is still close to 10pc of GDP. Its current account deficit is also stuck at 10pc of GDP and anyone who could have got their money out of Greece will have done so ages ago.

With no credit, unemployment has risen to 18pc. As we pointed out in this column last week, over half of young Greeks are out of work. This can’t go on. And as the great American economist Herbert Stein observed, “when something can’t go on forever, it will stop”.

Leaving the euro now must be an option for the Greeks, because they are looking down the barrel of what they see as years and years of indentured slavery to foreign creditors. Maybe they will vouch for the uncertainty of a new drachma rather than the absolute certainty of 10 years of contraction. Who wouldn’t?

At the highest level in Europe the cracks are beginning to appear.

In Brussels, Jose Manuel Barroso — maybe thinking that his native Portugal will be next — insisted that eurozone leaders would continue to strive to keep Greece in the euro. This was in contrast to Neelie Kroes, the Dutch commissioner who suggested to the Dutch press that a Greek exit wouldn’t be a big deal.

The Portuguese should be worried because with the latest round of cheap ECB financing, the Germans may be confident that they could allow Greece to go overboard without capsizing the project. The language has changed in the past week. Up to now, the deal was to quarantine Greece on a drip-feed of money, keeping it barely alive but sending the message out that while Greece is different, the family will look after it.

The Greeks are gambling that they can get cash without having to cut yet more.

They are hoping that they can just borrow more and more to maintain their standard of living. The Greek threat is if you don’t give us cash, we bring the whole thing down around you. The Greek position or ace is that Germany will blink first. Up to now this might have been the case.

But much has changed over the past week. The ECB is now lending enormous quantities to European banks at 1pc for the next three years. By the end of this month it will have lent close to €1 trillion. The banks are getting a free 5pc carry on this and are delighted.

The Germans might now be thinking that we have enough liquidity from the ECB to call the Greeks’ bluff.

Emboldened by the fall in Italian and Spanish bond yields, what if the Germans see beyond the Greek threat?

If they cut Greece off and inject money into every other nook and cranny of the eurozone, maybe they can get rid of Greece and manage the shock. If this could be achieved, the Germans would be delighted. This would allow them to get rid of a delinquent member and send a strong signal to the rest of them that more messing won’t be tolerated.

If this is an accurate interpretation of the last few days, then it will be reminiscent of the demise of the Gold Standard in the 1930s.

Back then the French behaved like Germany now. The French wanted to punish the Germans when the Germans, like the Greeks, desperately needed to roll over huge borrowing they owed to the Americans.

While the Greeks now are a different proposition to the Germans in 1932, the end game was the same. The Germans abandoned the Gold Standard but the French couldn’t control the consequences.

In fact the Swedes were the first to see through the Gold Standard. They abandoned it, printed money, allowed their exchange rate to fall and slashed interest rates. And guess what? Sweden was the first country to come out of the Great Depression.

Could the Greeks do the same as the Swedes? Yes why not? At the moment, Greece is facing a generation of austerity. It has to borrow 10pc of its GDP just to pay for its imports each year. Its economy is in freefall. The deal with the euro is that every country has to become more German to survive. Greece will never be Germany, so what’s the point?

Leaving the euro would lead to months of chaos as savings were converted to the new drachma. The local banks would see their balance sheets wiped out, if they were to pay their foreign creditors, so guess what? They won’t pay. They will pay in drachma. Inflation will take off and wipe out the debts, which have been converted from euros. The government will balance its books overnight or will borrow heavily from its central bank, which is printing the new drachmas.

It will be the cheapest place in Europe to go on holidays. And like all the other countries that abandon a strict currency regime that they can’t bear — such as Iceland a few years back — the economy will start to grow again. They will fall back on the IMF to stabilise the economy with a big loan, which will be senior to all the defaulted stuff. This worthless debt they will buy back at some ridiculous price. And life will start again.

On the 20th anniversary of the Maastricht Treaty, that’s the way things are likely to work out.

Once the world sees that there is life after the euro, as there was after the Gold Standard and lots of other now defunct currency arrangements, the financial markets will ponder who is next.

Don’t be fooled that this European debt story is over. It is not; in fact the interesting bit hasn’t even started yet.

For a new way of looking at tricky economic stuff, check out Punk Economics on YouTube. Also, David McWilliams will be speaking at Ballymun’s Axis theatre tomorrow night, tickets at axis-ballymun.ie


  1. molly66

    One thing I can’t figure out Greece needs this bail out but if it gets this money now and defaults any way is this not throwing money down the drain,because the Greeks can stick to agreements for what ever reason ,I know one thing what they are being ask to agree to is next to impossible.
    This is the same here we are benign asked to carry the can ,kick the can,I would like to stick the can where the sun does not shine.

    • Molly,
      it doesn’t really matter if it’s “money down the drain” they just print it out of thin air…so they’ll just print more. No one losses except the people at the bottom who will have to pay the rise in inflation.

      • Realist

        It is people at the bottom, but also all honest private businesses too.
        Who gains are just those first on money, governments, banks and gov sponsored “private” businesses.
        And it is not just distribution of wealth but also destruction of it when a lot of resources are wasted on malinvested projects.

  2. Lyndon Jones

    Who is next ?….well its Ireland of course.
    Remember our deficit is above 10% just like Greece but the real difference is attitude . The Irish have accepted their fate , the Greeks have rebeled and are unwilling to make changes ( austerity ) .
    The Irish are well informed and the only place you get the Greek attitude in Ireland is on this site but those deficit denyers are getting quieter and quieter .
    Moan all you want , put on the poor mouth it wont get you anywhere , its just denial.
    Greece wont recover Mr McWilliams it will always be a basket case no matter what they do .

  3. Well you couldn’t put it much simpler David. And like you keep saying, there’s nothing markets like better than a fresh gamble. This is all getting very stale now mainly due to the Xanadu policies of nuclear europhiles in too deep to even think straight. Yon game is up.
    Great to see our fundamentals here throwing a shape. Agri in particular. We`re well capable of boxing above our weight on the international commerce stage. In fact, with all the talk of markets and multi billion funny money funds, no-one has a word for people of commerce who actually add real value(and jobs).
    Btw, There’s a plethora of Irish “financial advisors“ around the country selling `German Govt Bonds`(yielding feck all) to the average Yahoo,thereby preying on fear and uncertainty.
    Crookery still abounds IMHO.

  4. Peter Atkinson

    I have no idea who originally coined the concept of The PIIGS but clearly it was someone who has more than the combined brain of the EU.One of the “I”s is already on the road to recovery, the “G” could have saved themselves a lot of aggrivation if they jumped two years ago.We know where the “P” and “S” are going and the other “I” will hang on till everone else has gone home and turned off life-support.

  5. Yes that is quite a credible scenario of how it will go. “Who will be next?” asks Lyndon Jones
    Right question, wrong answer. but perhaps he jests. It definitely won’t be Ireland. Ireland is the poster child for the troika austerity programme, and isn’t she so admirably following orders as instructed? No way she will be pushed.
    And Ireland won’t jump ship either, until there is regime change, and even then (if its back to the previous lot) maybe not. But its not about denial (or rather the lack of it as suggested by LJ) that keeps Ireland subservient to the troika, its gross stupidity on the part of this coalition of the weak, ably aided and abetted by the robber barons (namely the financial institutions and their buddies).

    • Colin

      Our friend Lyndon doesn’t do jest, believe it or not. He IS serious, and has plenty of form. Lyndon is an austerity junkie, always looking for the next quick fix. He has positioned his derriere in a ‘austerity free zone’, so he’s an armchair general in an economic sense, and that armchair is located beside a roaring fire, with fine whiskeys on a table nearby, and even finer cigars within arms reach.

  6. Adam Byrne

    subscribe.

  7. Deco

    Excellent article.

    Listened to the Podcast. A1.

    The herd are being excited, it is Spring time. In their collective memories the traders and investment bankers have moments of joy from their past when Greenspan, King and Trichet let ‘er rip with absurdly low interest rates, money creation and bank subsidization. They have those happy memories. And as soon as easy credit is released, the inner idiot takes over and the urge for euphoria with bonuses attached takes over. This is apart of psychology. And the politicians and the central bankers exist to please it. Just like Bertie and that “feel good factor”.

    As David says, it will end in another mess. An asset boom followed by an asset bust. Maybe we should run that erstwhile clown, Gordon Brown, crying out “no more boom and bust”….

    By the way, the authorities here are still dithering with respect to reform of the state owned banks. The two pillar banks theory will end in a heap. Neither of them is a pillar of anything. Sorry to say this, because the implications are dire for the people of this country. But that is the way we are headed. The latest gimicks by Noonan and chums to draw money and business into the country amount to farce. The regular working people of this country know that the state system is chasing them to take money away from them so as to pay for the Anglo bondholders.

    • Deco

      Paying the Anglo Bondholders is turning us from a pretence ridden Banana Republic, to an honest Banana Republic.

      By this I mean that the working people are being honest about the deceipt that rotting on the bones of the system. The working people have sussed out that “the game is rigged”, just like in Leonard Cohen’s song.

      And the best that government ministers can do here, is engage in a bitching session about people making comments on the internet, that would never be circulated on the sterile zone that is state propaganda arm.

      • rebean

        I would say pay the bondholders we have no option. In the same vein stop the waste in the country there is loads of it.I am listening to the waste of public funds in Cork via the VEC. The Govt are not stopping the waste. When we balance our books we no longer need handouts from Europe.Ireland is a country where handouts are ingrained in a portion of the population.The money paid to bondholders is a fraction of the money borrowed from the ECB.Things are going to get really scary soon when our interest on borrowed money exceeds 10 billion which will be in 2016. Maybe David can help me with the figures and dates. It will be I believe endgame for Ireland

  8. rebean

    It seems to me Greece are playing Russian roulette again with the Germans. I heard a comment by Merkel the other day commenting on Greeces inability to accept the bailout in utter disbelief.This will go on and on I reckon. The Germans may decide to let Greece go but I think they will play it safe. Its in their nature, they love organisation and order. Its an awful pity we dont seek some real concessions

  9. The Maandarin Replay

    When its Irelands turn the above cartoon will be located at the cliff edge inside the middle of Dun Aengus very high above the angry ocean waves awaiting the offerings to the Gods of War.

  10. Malcolm McClure

    I think Greece is playing the Prodigal Son card.
    Germany is the father, France the elder son and Greece the younger son who has spent his inheritance, become a swineherd and returns to call on his father’s charity.
    Greece apparently expects Germany to fall on his neck, kiss him and prepare a Welcome Home feast. –France resents this.
    Trouble is, compassion isn’t one of Germany’s virtues.
    I wonder?

    • rebean

      Will the good father kill the calf do you think and throw a big party when Greece returns to repent.I dont think the Germans have the heart for it. Wait till Ireland decides to return I would say they will have enough at that stage. Maybe thats why we are called the pigs. Maybe the prodigal son figured he was better off away and he sent the pigs back instead

  11. CitizenWhy

    How can Greece live with these so-called “deals”? It just does not seem possible.

  12. Eireannach

    Anyone who thinks Germany will “blink” first is delusional.

    DMcW is right this time. The eurozone creditor countries, led by Germany, are not going to let the Greek “tail” wag the eurozone dog for much longer.

    • Grey Fox

      You still describe this whole issue as a “game”, “who will blink first”, Greece is way past viewing this as a game of brinkmanship, they believe they are fighting for there very existence, their way of life (whether you like their way of life or not, it’s what the are accustomed to and how they have grow up).
      Back a man into a corner and take EVERYTHING! from him and he becomes unpredictable and dangerous and WILL come out fighting (no other option), just at the point where the oppressor thinks all the fight is gone out of the man. It’s what is called Victory from the jaws of defeat (in this case Default), even if Europe turns it’s back on Greece and Greece defaults, it will become apparent very soon after to the Greek people that they have made the right decision no matter the pain at the time. Before this thing comes to a head, Germany and the Eurozone countries will be beging Greece to accept a 90% writedown (not 70%) because the alternative for the Eurozone and the US is not acceptable either (Greek default). The dog needs it’s tail!!!!

  13. rebean

    Wheres BONBON these days i love reading his posts

  14. Land n Gold

    Bloomberg reports that at almost 1 am local time, the Greek government meeting has broken up, and the head of LAOS is speaking, and by the looks of things, is not going along with the program:

    KARATZAFERIS SAYS HE DID NOT HAVE ENOUGH TIME TO STUDY MEASURES
    KARATZAFERIS SAYS HE NEEDS LEGAL ASSURANCES ON MEASURES
    KARATZAFERIS SAYS HE MIGHT CONTINUE TO SUPPORT THE GOVERNMENT DESPITE NOT AGREEING TO DEAL
    KARATZAFERIS SAYS HE MADE HIS POSITIONS CLEAR EARLY IN MEETING
    KARATZAFERIS SAYS HE APPRECIATES THE PREMIER’S EFFORTS
    KARATZAFERIS SUPPORTED ND LEADER ON ISSUE OF PENSIONS
    Translation: no deal. And, dum dum dum, another headlines says that the Troika is now back in Papademos’ office. The suspense builds.

    Papademos Says Outstanding Issues Remain, EURUSD Slides
    Another day, another delay, and still nothing is done.

    GREEK PREMIER SAYS OUTSTANDING ISSUE NEEDS FURTHER WORK
    GREEK PREMIER SAYS DISCUSSION TO CONTINUE ON OUTSTANDING ISSUE
    PAPDEMOS SAYS AIMS TO CONCLUDE LOAN TALKS AHEAD OF THURSDAY’S EUROGROUP MEETING
    And on the off chance that Greece, gasp, does not actually get something done by the deadline, it means that at tomorrow’s meeting the only topic of discussion will be the calorie content in the taxpayer funded pastries. In the meantime, some semblance of reality is creeping back into the EURUSD.

  15. Hobbesian War

    Man’s life in a state of nature, said Thomas Hobbes in Leviathan, is a “war of all against all:”

    And in that state of nature, no arts; no letters; no society; and which is worst of all, continual fear and danger of violent death; and the life of man, solitary, poor, nasty, brutish, and short.
    In the Hobbesian view, there can ultimately be no cure for violence; it is in our wiring; in fact, it is in the bones of the universe in which we live. You can counteract or punish it–you can shoot the shooters–but it will always be with you. Civilization, according to Hobbes, is the way we organize ourselves to repress violence.

    • bonbon

      Karl Marx, from his amusing “Digression on Productive Labor.” :
      Mandeville maintained that Thomas Hobbes’s war of all against all, is that which forces man–a “creature of instinct”–into a social order, and this yields Mandeville’s essential thesis: that what we call evil in the world, both the moral and the natural, is the great principle which makes us into social beings, the solid basis for life, and the basis for all the industry and occupations of man, without exception; here it is that we have to search for all art and science. As soon as evil should cease to exist, society would have to decay, if not go under completely.
      —–
      So Mandeville’s Fable of the Bees, lauded by von Hayek in his Mandevlle Lecture at the London School of Economics, implies that art, science can only spring from evil.
      Marx was astute enough to point to this, whatever his failures were otherwise.

      Mandeville is the founder of the Hell-Fire Clubs that sprung up all over the Irish and English countryside.

      • Realist

        Who can understand this nonsense ?????

        • bonbon

          The KISS principle : The EU is in a war of all against all. That too difficult to see?

          Second: the entire Austrian School is based on an Hobbsian economics of all against all. Still with me ?

          Third: idiots want to use that economics to cure the problems. Still following?

          Fourth: it is not that difficult.

          You got it!

          • Realist

            So, you are calling me idiot.
            Thanks bonbon.
            You are wrong as usual, your socialist utopia is not going to work.
            It is dismantling currently around Europe, socialist should be a past and burried once for all.

          • bonbon

            @Realist, no you are not imposing this policy, but I can name a few professors and politicians who are. It is one thing to argue here academically, quite another to overthrow a government and carry out a policy without, as Michael D. says, no mandate whatsoever.

            For instance all the pro-return-to-DM influentials who brought Lisbon I, and I to the German Constitutional Court are true Hayek-ians, which means the physical economic alternative to collapse is blocked by “monetary conservation”.

          • Realist

            Politicans do not count.
            They are societal wasters and nothing else.

            Current economists are Keynesians and you are lier and probably politican, as nobody can lie like you.

  16. David, just one nit-picking point, but perhaps an important one. My understanding is that Greek debt wil continue to be denominated in Euros. When we all signed up to this thing we gave a guarantee that this would be our currency in perpetuity. Anybody holding Greek (or Irish) bonds has a guarantee that this debt will be repayed in Euros, even if we decide that the national currency is the banana. Is this the case?

    What would have to happen I suppose is default on a substantial part of their sovereign debt, and that’s a messy business. At least in the case of Ireland its an easier prospect just to default on the bank debt, (but our sovereign debt might double as a result of leaving the Euro?)

    The easiest, cleanest and most equitable solution (well, maybe not if you live in Germany…) is total fiscal union.

    • bonbon

      There is no way to clean up this mess. Berlin is fully aware that “fiscal union” sends the bill to German voters. So far they have never got a single chance to vote on any Euro issue.

      I wonder why?

      So we get “fiscal union” that is not, as DMcW pointed out in a recent thread. We have a Euro but no State, an abomination from some feudal bankers cellar.

      The only possible object of this incredible mess is the single fanatic desire to remove modern Nations, National Banking, and Credit financing. In other words to roll back the entire modern era. This is the explicit stated objective of a roster of “thinkers”.

      My only question is how witting was the Dublin Gov’t in this circus? We know already Conor Cruis O’Brien’s role. Or Athens – EU brought in Goldman Sachs to fiddle books to give the project a green light.

      The irony is that Russia and China adopt modern national methods, as the EU/USA destroys itself. A reptilian instinct makes Obama then go after them – the same pre-modern reaction that gave us the Euro.

      • Yes, I am aware of all of this, I am suggesting that if Germany wants to make the EU and the Euro work, it has to pay. The basic deal is and was that we buy stuff they make, so its a fair trade. I have two questions:

        1: Debt denominated in Euros remains in Euros, yes or no? My understanding is ‘yes’.

        2: So whats really being proposed here is to default on sovereign debt, yes?

        I have no problem with any of this by the way, I just want to be clear on what it is that I am asking.

      • bonbon

        No “return to national currencies” and debt “restructuring” can possibly work without first splitting the banks – letting the investment arms and books out to dry. Only then will honest bankers work on this. Trust is nice, but Glass-Steagall is better.

        With poster-boy banker honesty all of the debts can be dealt with, and legitimate debt repayed by a growing economy, which means directed credit for huge projects over years.

        So FIRST split them.

        THEN we hit the next “pincer-move” the insane Hayek Austrian School which will try to prevent any of the solutions with funny “real money” and “gold standard” arguments. National credit and currencies regulated via Bretton-Woods type agreement will work.

        We have TWO simultaneous attacks to deal with. War on 2 fronts.

  17. bonbon

    EU/ECB Desperately Try To Postpone Explosion of Greek Bomb

    The ECB announced a “discount” of EU11 billion on Greek debt, while at the same time German Finance Minister Wolfgang “Brüning” Schäuble announced that Greece will receive only a first installment of EU30 billion from the second bailout package of EU130 billion. The plan is supposed to allow Athens to refinance a EU14.5 billion bond coming due in March and avoid insolvency, but keep up the pressure on the ongoing debt negotiations with the Troika, wrote {Financial Times Deutschland} today. Only once the deal is settled will the rest of the package be released.

    Possibly, Schäuble’s decision was dictated by Josef Ackermann, who represents private creditors in the negotiations in Athens.

    In the meantime, the ECB will refinance banks for the second time with a three-year tender later this month, with a loan expected to be up to EU1 trillion.

    No debt settlement with Greece without an 80% debt-cut is possible. At the same time, a haircut means a systemic chain-reaction: Mission Impossible for the euro system.

    As Wolfgang Münchau wrote in {Spiegelonline} today, the Greek “bomb will explode. The open question is only when it blows up — and whether other countries such as Portugal will be torn off by the shock wave of the explosion. By betting on an unrealistic temporary solution, as it is planned now, the problem is once again postponed. The detonation therefore will come a bit later, but, therefore, it will be all the more devastating.”

    Buying time until the war?

  18. michaelcoughlan

    Hi,

    What is obvious from this article is that the Euro isn’t going anywhere. It would appear that if the last country standing after all of this is Germany then they will have the euro rather than the Mark and life will go on thank God. At least the situation is becoming as clear as mud rather than the total white out of the last few years.

    • bonbon

      The howler is that Germany is allowed to have anything but the DM, even the last Euro!

      Crazy! Only a mad Maggie and Mitterand could have come up with this.

  19. bonbon

    Correct me if I am wrong, the cartoon seems to depict Merkel and Papademos?

    Then it is totally wrong – Goldman Sachs boy Papademos is doing the EU’s BIDDING, and the people of Greece are being offloaded into abject poverty.

    It should show Merkel arm-linked to Ackermann and Papademos, kicking people over the cliff into a Stygean pool.

  20. cooldude

    David you are falling for a commonly held misconception in relation to the gold standard. The gold standard was ended in 1913, first by the Germans and then all the other combatants, in order to pay for the upcoming war WW1. If they had stayed on the classical gold standard the war would have only lasted a few months as none of the countries could afford a longer war. Millions of lives would have been saved but the governments abandoned the classical gold standard and simply printed vast amounts of unbacked paper money to pay for this horrendous war. When the war was over most of the main protagonists had trebled their money supply but they made the huge mistake of trying to revert to the same gold price. This was known as the gold exchange standard and was inherently deflationary. What they should have done is gone back to the original standard, which had worked very well, by trebling the price of gold to reflect the huge increase in the paper money supply during the war. This is a commonly held misconception and is used to give commodity backed money a bad name. The only way out of our current mess is a return to commodity backed money and this will eventually happen. Unfortunately it will probably take the collapse of the present paper currencies to facilitate this as there is very little appreciation of the huge benefits of a commodity backed money system.

    • bonbon

      A very odd view of history indeed. The Versaille Treaty forced gold repayments (value $31 billion then), handled by the BIS, an impossible task.

      Secondly again I hear nostalgic yearnings for the British Gold Standard, as codified by von Hayek.

      With a Gold Standard (or metal) in place, monetary policy is entirely dependent on Gold Production as opposed to Physical Economy Production in the form of Infrastructure. There is not enough Gold to support an expanding economy and population. Result is and was always deflation, and depopulation, i.e. genocide.

      • cooldude

        The greatest period of growth in US history occurred in the period 1834-1914 under the classical gold standard. The US CPI was the exact same during these eighty years with zero price inflation. The US GDP grew on average 4% per annum during this period and it is still their greatest growth period ever and all on the classical gold standard. The CPI in Britain remained the same from 1713-1913 and they had their industrial revolution during this period. From 1913 to the present day their CPI has gone up over 2500% which has caused havoc with the savings of ordinary people. It now costs 270 base metal pounds to buy a 1913 gold pound or the sovereign. There is always enough gold unfortunately there is not always enough common sense. Genocide occurred frequently during the war ravaged 20th century when governments printed endless amounts of money to support their war machines. And so it continues. Iran looks next.

        • Cooldude,

          Thanks for the comments. Let me go back a read a bit of history.

          Best,

          David

          • cooldude

            David,
            A couple of new books that might be of interest to you on this subject. One is “Currency Wars’ by Jim Rickards. The other is “Paper Money Collapse” by Detlev Schlicter.

            Enjoy

            Cooldude

          • Mass Psychosis:

            ” It almost appeared as one only had to wait for the tidal wave of fiscal concern to take one state after another out of the safe-haven basket into the basket of basket cases.”

            -Detlev Schlichter-

        • Lord Jimbo

          The period 1834-1914 also coincided with the final subjugation/extermination of the native Americans, the emergence of the United States (where all the final states fell into place). There was the considerable blip of the US civil war (600,000 dead and the obliterated southern states) which was followed a few decades later by the discovery of oil in the early 1900s, for instance, the famous well at Spindletop struck oil on January 10, 1901 with the United States soon becoming the world’s leading oil producer at the time and the rest is history as they say.

          Interesting comment though about the various protagonists printing money to fun WWI as others have repeatedly said, the hyper-inflation that struck Germany in the 1920s still haunts their thinking.

          • Realist

            This is why German’s still do not allow ECB to print money just like that.
            They still remember hyperinflation.
            I also lived in the country with hyperinflation and remember when full bag of money could not buy 1kg of meat.

          • Lord Jimbo

            Would really like someone to a parallel analysis of major fiscal crises and conflicts side by side with economic data, indicating what went on, how countries were impacted, how some declined and others rose to superpower status, would be very interesting to see this play out from 1492 with particular emphasis from the industrial revolution down to today.

          • rebean

            Yes its haunting them alright and its haunting everyone else at the minute. They needed higher interest rates when we had lower ones. Now we need lower interest rates and they want higher ones. Or was it the other way around. Maybe someone could clarify it. Anyway there was no joined up thinking. They suited themselves ultimately

          • Realist

            That will be very interesting, but I cannot imagine it being done.
            The first problem is that much data does not exist.
            The other problem is what kind of economist is going to explain the things, as we can see there are many contradictory school of economy.
            You can see how we argue what is the problem currently :)

            I liked the book “Money, Bank Credit, and Economic Cycles” by Huerta de Soto. It is a nice book and it is free: mises.org/books/desoto.pdf
            You will find some historical details and references in there, what was going on with banking.

          • bonbon

            @Lord Jimbo, start by looking up the collapse of the Bardi and Perruzzi banks in the 14th century. There we have the first “global” derivative collapse. Barbara Tuchman’s book goes into this. The plague followed and the reasons are all there. After that all serious discussion will refer to those 2 banks.

        • Deco

          Cool dude fair point.

          The regimes that all caused the problems in the twentieth century, were all variations of a theme. A cadre led by a “leader” set about running the rest of society according to their opinion. Often the cadre were a collection of opportunists seeking power, who seen the institutional state as an opportunity to satisfy their own psychological needs. And to justify their projects, they all have “improvement” plans, which involved them readjusting the rest of society because the rest of society was insufficient to their “vision”.

          The whole point of ideology was really irrelevant. Communists became fascists, and monarchists could become republicans, and vice versa, if the circumstances demanded. Really, it was a case of a herd of sick human beings who were “onto the next big thing”. It exists in economics, and it also exists in politics.

          Paper money facilitated such regimes, and of course, they always preferred to have the wealth creation power in the state.

          This is what the 20th Century was really about. So yes, it was a century of war. The state as a unit of organization was to the target for such opportunists, because it was the primary unit of power.

          The cadre effect, followed by regime empowerment, population control, and currency printing is a cycle that we have been through many times in the past 98 years.

          Some approaches are less evil and twisted, than others. And usually to the tune of “fixing2 the previous errors, the following ideology is an enhancement or an reversion against the previous ideology, which is now disgraced.

          But ultimately, they all go through the cycle.

          It progresses to compromise, then corruption, then the belief in bigger being better, moral banktuptcy, then inward expansionism, then outward projection of expansionism, then financial bankruptcy, then wholescale systemic corruption, inflation, and eventually hyperinflation.

          But never mind all of that. Gold is deemed to be barbaric, as a monetary instrument.

        • +1

          Precisely what I kept saying here since a long time! The younger history started with the synchronous change in the U.S. to SNA and in Europe to Maastricht. Its is all documented.

          • And the theater continues, as for now, Greece accepted the German debt dictate, people are dying, their future ruined while a handful of Banksters and politicians in cahoots line their pockets and change the political landscapes in the entire World for the next few decades.

            The global Coup d’état, the perfect crime!

          • Eireannach

            Yes, it is the perfect crime because the sucker public TOOK the bankers’ money and got themselves in debt!!

            Ditto myopic governments like Greece.

            It’s like that old tale of the devil never crossing your threshold unless invited.

            The Irish couldn’t wait to invite this dark hooded stranger in night across the threshold of their foyers – sure he had a jangling bag o’ gold for us!
            (nudge nudge, wink wink, rub hands in gombeen glee)

      • coldblow

        Bonbon

        I agree with you on this point.

        Polanyi (The Great Transformation) describes the mitigating effect of central banks in avoiding “the wholescale dislocation of business and employment involved in deflation and to organize deflation in such a way astoabsorb the shock and spread its burden over the whole country.”

        He goes on to say: “That in spite of these devices to mitigate the effects of deflation,the outcome was, nevertheless,again and again a complete disorganization of business and consequent mass unemployment, is the most powerful of all the indictments of the goldstandard.”

        and

        “More and more it was recognized that the international gold standard could be made self-regulating only if the single countries relinquished central banking. The one consistent adherent of the pure gold standard who actually advocated this desperate step was Ludwig von Mises;his advice, had it been heeded, would have transformed national economies into a heap of ruins.”

    • bonbon

      I suggest this, Byron Dale :

      http://www.youtube.com/watch?v=9E0UPBtmTb0

      to see the Austrian School von Mises Institute taken on and demolished. It goes over the whole money and gold discussion in a very understandable way.

      • Realist

        He, he, he. The guy who does not even have the profile on wikipedia or anywhere else to destroy Austrian school of thought ???????
        Bonbon, just putting stupid links on this forum is not helping really, you are just sinking down.

      • bonbon

        Sire, you protest too much.

        The video’s are devoid of mumbo-jumbo, the kind that most people today have an allergy to. It is so easy to demolish the (complex) Austrian School Gold Standard. I chose the axiomatic way, and Dale the money way.

        I recommend this 3-part video to all here who wonder how money works, and should work.

        • Realist

          You just use any internet source to try to discredit Austrian school of economy.
          I just said that nobody knows who is that guy in video, so it is hard to spend hours watching them really. Show me the link where it is clear who the guy is please ?

          And you never read any book on austrian’s so give them a break please.

        • Realist

          And I bet you did not watch those videos yourself.

          Would you tell us 2-3 main critical arguments why gold standard is bad so we can discuss it properly ?

  21. Peter Atkinson

    In all the madness being visited on Europe in general and Ireland in particular, LIVE 8 sprang to mind.All that talk of debt forgiveness for the third world six years ago.

    At the height of the boom in Ireland there we were sipping Bolinger paying lip service to the poor unfortunates in the Sub-Sahara crying crocodile tears and demanding “justice” for the third world while lobbing another €50 across the bar for the next round.

    All laudable of course but in the short space of three years the European myth was unravelling right before our very eyes.Here we are witnessing the very vultures who helped repress the Sub-Sahara for years turning on members of their own club.

    Guess what.The two big proponents of the Live 8 concept were ironically Irish, Sir Bob Geldof and His Majesty Bono and not a single word from either of them on the European tradgedy.As far as I am aware their tax returns are well outside this very jurisdication.The very people who poured millions into their coffers may well appreciate the odd word or two on the current state of affairs.Surely Bob and Bono, the boys from Ballymun and Blackrock who have had in the past, fortright opinions on injustice have something to say on the whole fiasco.

    • bonbon

      Correct on Geldof and Bono, running around Africa spouting “sustainability” “small is beautiful” – all the standard British Empire cliches used there for centuries. They deserved knighthoods!

      China came in and built infrastructure, transport, power and Britain was not amused.

      The Bono, Geldof mantra is repeated by many.

      • Lord Jimbo

        Chinese built roads etc so they can get in and get out. Resources.

        Africa may again become the pawn it was during the Cold War, countries played off one another while their resources are exploited, local elites paid off and people remain in dire poverty. Just look at the images of oil pipes going through villages and in some cases, houses, in Nigeria. People are dirt poor while the country gets substantial revenues from oil, which in turn Western companies and governments make enormous revenues on the martet once it the raw materials are refined, hence petrol shortages in Lagos while oil tankers leave laden with the black juice.

      • bonbon

        And British Empire’s cartels even with American-like names loose out. Britain’s colonies only got infrastructure for looting. We only got electricity after dumping the Empire.

        We will reroute the Congo river to refill Chad, drain the Sud. China looks like the best partner with similar projects forging ahead there.

  22. Dorothy Jones

    ‘Are the Germans about to give up on the Greeks?’
    Probably…recent description of Greece by a colleague in Bonn working for the Foreign Office as ‘Rausschmeissland’ [country to be thrown out] seems to reflect opinion on the ground there, whether that’s right or wrong. Mind you, they said that Ireland was too, but that is not how the average punter sees it.

    FAZ and Handelsblatt don’t say so directly, but recent articles certainly have examined the possible consequences.

    Even if 20 March passes without default, seems like Greece has a Herculean battle ahead.

    • Eireannach

      Well Dorothy, based on your anecdotal evidence, the probable outcome is expulsion of Greece from the eurozone.

      It’s been coming for a long time.

      • bonbon

        See my post above what Münchau wrote in {Spiegelonline} today, and be ready for the explosion.

        • Eireannach

          Yeah Bonbon, a Leo Varadkar “bomb will go off”. Yawn!

          They’re out – and we’re in. You better believe it, the Irish now public will scamper into the fiscal compact out of fear.

          It’s obviously the master plan – you with your NWO vision of things should see that.

          • bonbon

            NWO another word for the British Empire. No not my kettle of fish.

            No idea how informed Varadkar is, maybe he heard rumors.

    • @ Dorothy

      In my simple language forget about that date you mention namely ‘the 20th ‘ . It means nothing .

      Open your celestial mindset and absorb the experience we all are going to share between ‘ 21st and climaxing on the 28th ‘ . This will be The Moon Wobble with a lot of Rock & Roll .

      • Dorothy Jones

        Bond redemption due by that date John, bailout needed before that to avoid default. News just out on Reuters now that austerity measures have been agreed to by Greece, Troika approval and paperwork to be complete by Feb 15. Freak sideshow set to continue for a bit so.

      • Dorothy Jones

        That wobble sounds like fun John:):):)

    • molly66

      I think the Germans want the Greeks to stay in ,maybe they see true whole thing fall apart if Greece leaves,but if Greece keeps getting money for it’s black hole they will bring us all down.

  23. Philip

    Germany’s exports are now past 1Trn. 2nd largest exporter in the world after China. You got to hand it to them. 90Million of them versus 1.4billion Chinese versus 300Million Americans. Amazing. And all of this against a stagnant backdrop some 10 years ago.

    Makes me wonder why do they bother staying in the EU at all? Why do they not simply cut loose? No one is stopping them except themselves and the euro devaluing capability of the PIIGS.

    As for the horse$h1t being peddled on this board about the deceitful nature of the Greeks. Are we to seriously believe that the Greeks managed to con the EU commission and auditors into being let into the Euro? This was a political play and its ramifications played very well into the export figures of Germany and other leading exporters.

    When the Greeks go, the game is up. In a strange way, they may be held responsible for saving the EU by standing up to bullies.

    By the way, I am a great believer in austerity and lots of it – for anyone churning money and nothing else.

    • Deco

      You know the way Brussels works, if the EU Commission found out that the Greeks were lying, they would then face the dilemma of having one less member or slightly corrupting the ssytem.

      In which case, based on previous history, they would have given the Greeks a public lecture, and they would then have settled for slightly corrupting the system.

      I mean the point of the club is to monopolize power, and there is a danger that if members might leave, they might suddenly find themselves liberated from the nonsense that goes on in Brussels. Even worse they might weaken the scale of corruption within the establishment inside Greece – making further overtures to the Greeks more difficult, than if an establishment existed which could be bought off with promises of easy money.

      The EU started off as a trade project, and it was a roaring success. Then it became a political project, and it became a source of corruption. When it became a currency project, it made the sort of compromises – ensuring eventual bankruptcy of it’s members.

      The Germans have made a Faustian bargain with the polticians of Europe – a competitive currency and complete free trade, in return for a transfer regime that actually impovrishes other countries, because it feeds such wholescale corruption.

      The old “something for nothing” deal destroys the receiver, and inflicts dysfunction on the given.

      • Eireannach

        “The EU started off as a trade project, and it was a roaring success. Then it became a political project, and it became a source of corruption”.

        This is the classic British eurosceptic argument. It’s a fair point of view.

        The British have never wanted a politically federated Europe because they would be the third most influential member. So they are having none of it.

        The British eurosceptics and your good self can huff and puff and blow smoke into your keyboard all you want, but the facts on the ground remain the same – the EU is federating and the only remaining question for Ireland or, indeed, anyone else is “in or out”.

        If we had a referendum on that question, you, Deco, would undoubtedly vote “out”. Meaning you would consign Ireland to return under the UK sphere of influence.

        Well, the entire Irish establishment is saying “in”. It’s you against all of them Deco. It’s eurosceptic DMcW/Deco “David” vs the EU “Goliath”. Best of luck!

        • Philip

          If you want to see another fed state, you can see the ruins over there in the US of A. It is essentially a few cities on the coast, one or 2 in the middle and the rest is a wasteland with no employment and no manufacturing base and worst of all, very poor representation BUT with a represntational model far in excess of what we have in the EU.

          Now, even when you look at Germany itself, it has a highly class based and restricted/ stratified from an early age educational system that is designed to drive a large blue collar (albeit very highly skilled) contingent which requires growth to stay stable. This is a country on the brink of societal collapse if growth vanishes as as further automation takes place – which I think it will – becasue no one is buying. You only need to see the PMI indices, the bulk shipments of raw materials movement to see that something is about to pop.

          Now, leaving the above aside, and as I see some of our bright kids going to college doing science, engineering and software development etc, the last thing I want to see is some faceless nitwit from some bundes educational outfit decree that our kids can only do agragrian or tourist jobs becasue Ireland cannot afford to be wasting time skilling up in anything else. And believe me, that is what’ll happen because that is what happens in Germany today – which is all fine and dandy becasue you can move around it easy enough.

          The fact is that the EU does not quite click together and yet we are driving to a federated system that will divide and create class wars like we have never witnessed before becasue represntative structures are simply not there. We think we know what elites are now? Wait until you see what’ll pop out if things proceed along this path.

          Anyway, I am not too bothered. The financial system is broken and the employment problem has not been solved and is getting worse. Primary/secondary bindustries are folding left right and centre because the the buyers (workers) are vanishing. Until someone resolves this conundrum (and it will not be fixed by credit), we are heading somewhere unknown in a basket.

          • Eireannach

            Lookit,

            “In” the German-led eurozone superstate will herald a complete reconfiguring of Ireland.

            “Out” of the German-led eurozone superstate will herald us falling back under the UK sphere of influence, as it is the leader of the EU peripherals, and will remain so.

            I take it you’re more of an “out” guy.

            That’s a perfectly fair and valid point of view.

            However, the entire Irish establishment is “in”. All our policy is oriented toward “in”. Even little details such as pulling down our roadsigns in miles and putting up new ones in Kilometres points in the direction of “in”.

            Neither of these future pathways appears easy.

            But I’ll make a prediction for you.

            The Greeks will end up in the “out” camp and it’ll be a disaster for them initially. Possibly not in the long term, like Iceland, but certainly in the short to mid-term.

            The Irish public will see this and, since the Irish public’s driving ambition is simply to lead quiet, middle class lifestyles unmolested by instability and turmoil, they will increasingly incline toward the “in” camp.

            Fear will be used to shepherd the Irish onto the “in” pathway and it’ll work.

            The “out” people – Sinn Féin, United Left Alliance and the Dame Street protesters – will not be able to inspire the worried and petty-minded fearful Irish public to take the plunge. The Irish will huddle around their leadership to stay “in”, put their heads down and get on with life, as so many times before.

            As for the conspiracies of the world financial elite, the Irish public will leave it to other people, less preoccupied with their own concerns, to deal with such weighty matters.

          • Philip

            If people are not getting a decent wage and soon the issue of whether being IN or OUT will be irrelevant,

          • Eireannach

            @Philip

            You’re not “entitled” to a decent wage, you know.

            We’ve been overpaid relative to other countries for a long time now, starting in the mid-1990s.

            As a region of the eurozone superstate, our salaries will have to fall back to down to eurozone averages for us to have a stable economic situation. That’s a fall of another 20% or maybe more.

            What’s the alternative? If we leave the eurozone we’ll go off a cliff and we’ll be even more “competitive”, overnight.

            Actually, DMcW has long advocated this second shock devaluation instead of the first option, “internal deflation” within the eurozone.

            Either way, with a globalized economy, and Chinese and Indians ready to work for nothing, we get poorer.

            I accept that there is no way out of this decline in salaries, whether inside or outside the eurozone. Do you?

          • Mark Walsh

            @Eireannach, very valid points about the middle class being the ‘In’ section.

            I posit the middle class will be joining the the ranks of the working class very shortly and will remain there for the foreseeable future.

            Hell, half of them are already there with underwater mortgages and credit cards.

            Only then will we see media coverage given to that most ‘contemptible of concepts’, a decent wage.

            If any man or woman puts in a fair days work, they ‘are entitled’ to a fair days pay.

            The employer in ‘not entitled’ to deny workers that basic right.

            The middle class better be careful what they wish for; they might just get it.

          • Eireannach

            @MarkWalsh

            Agreed. Everyone should get an honest day’s pay after an honest day’s work.

            But from now on, for “honest day’s pay” read eurozone average.

            It’s only a matter of time before the Irish public sector are told in no uncertain terms by the Troika that an honest day’s pay in the eurozone state is a lot less than what most people in Ireland are used to.

            The Irish middle class are dreading this because of their high household debt levels, as you say.

            But the eurozone average is “an honest day’s pay”.

            More than that is not honest, when the country is in receivership.

            That’s where we’re headed. That’s where we bottom out and go along the flat for a while, as you say.

            FWIW, it’s not the end of the world, it’s just living like the continentals but, tragically, with Irish debt levels. Add that together = new working class.

            I include myself in that category, fortunatly without too much debt though.

          • Mark Walsh

            @Eireannach, we’re on the same page then.

            Call me a heathen but I use “the going out for a pint” barometer when looking at local economies.
            These days you cannot get change out of €50 note on a Friday night, between taxi fares and the actual pints etc.
            Every price sector in Ireland is way out of line with mainland Europe.

            It pretty much always has been since I started my quest for the quench back in 1982! :-)

            Going out just for a few pints with your friends on a Friday should not cost €50.

            There is so much more to say on why this is the case and to use that god awful phrase iterated by those muppets that are getting €100k+ pa from the taxpayers ‘we are where we are’.

      • bonbon

        To shed some light on the “EU”. Declan Ganley of Libertas on Jan 8, Sunday Business Post, “Declan Ganley: A Europe for the People by the People” puffed up as a “bold new idea” on Jan 14 by IT. He called for a Federal Europe at FPRI, a Philadelphia think-tank in 2003.
        This “bold new idea” is in fact not new, is best traced to Sir Oswald Mosley’s “Europe, a Nation” in 1948, presented in Venice in 1962. (Mosley and Diane Mitford, were married in 1936 at the home of Joseph Goebbels, where the guest of honor was Adolph Hitler.)

        To quote Mosley :

        “The European government shall be elected by a free vote of the whole people of Europe every four years at elections which all parties may enter. This vote shall be expressed in the election of a parliament which will have the power to elect a government and at any time to dismiss it by vote of censure carried by two-thirds majority. Subject to the power of dismissal, government shall have full authority to act during its period of office in order to meet the fast-moving events of the new age of science and to carry out the will of the people as expressed by their majority vote.”

        Mosley also said that:

        “…economic leadership of government shall be exercised by means of a wage-price mechanism, first to secure similar conditions of competition in similar industries by payment of the same wages, salaries, pensions and fair profits thus securing continual equilibrium between production and consumption…Capital shall be made available to the underdeveloped regions of Europe from the surplus at present expatriated from our continent.”
        ——-
        This makes some of the claims here look ridiculous. We are seeing exactly this in motion now. This is the most explicit expression of the various Pan-Europe operations I have ever seen.
        The entire mess is the result of a British project!

    • bonbon

      After reviewing Sir Oswald Mosley’s 1948 “Europe, a Nation”, echoed by Libertas’ “Federal Europe”, it is no surprise to me whatsoever that a little detail like Greek economic statistics (accounting by Goldman Sachs) would get in the way of the program.

    • Lord Jimbo

      Countries operate out of self-interest, it is clearly in Germany’s interests to be in the EU, they have put a huge amount of work into it and are at the crossroads despite the current crisis of the whole game playing into their hands. They are on the axis of Western and Eastern Europe and as you point out have maximised the global game as their export figure indicate, I was particularly struck by their deals with China, which exceeded the UK by a few billion. They are the races, they play the long game and must have found Ireland’s property boom an absurdity but in keeping with the ‘Anglo-Saxon’ model of creating something from nothing only to see it all catch up with the architects, castles built on sand etc.

      The Germans are after all known for building things that last, a very dynamic country and superb to visit.

      • bonbon

        Germany is not German Bankers, needless to say. Deutsche Bank under Ackermann (Swiss?) has become a world class giant casino.
        Large once-traditional firms have become holding companies (i.e. banks) exactly like GM’s GMAC at the end. Even the Landesbanken got into crazy derivative scams and massive bailouts are underway.
        On top of that German Banks are sitting on mountains of toxic paper, bonds, being offloaded to the ECB.

        The export boom hides this for now…

  24. You dear Leader:

    “It’s very clear that Ireland has not sought and will not seek any writedown,” Mr Kenny said in an interview with Bloomberg Television yesterday in New York. “We’ll pay our dues in full and on time.”

  25. Realist

    David,

    Firstly gold standard is not as bad as people usually think.
    It was making business more predictable with fixed exchange rates and no inflation.
    Entrepreneurs could do their calculation better and could do better job for consumers.
    In the current environment it is understandable how nobody want to risk anything as things are unknown while politicans and central bankers are creating their own reality.
    And gold standard can only work properly with full-reserve banking and no credit expansion.
    Bear in mind that central banking is making the mess with low interest rate and credit expansion all the time.
    Gold standard while used together with central bank was a bad idea anyway. Central banking with fractional-reserve banking is the worst invention ever created for destruction of wealth.

    Secondly, saying that “The banks are getting a free 5pc carry on this and are delighted”, might not be fully correct, as banks are getting into even deadlier link with the government bonds.
    Banks are getting such money while putting government bonds as collateral to ECB.
    Banks will need to take such collateral back after 3 years, meaning it might be wortless and they can bankrupt too.
    The other problem is ECB, that is now at least 100-200 times levereged and have no enough capital, so if it is real private bank it be already bankrupt (Lehman was 30x levereged when it failed I think).
    But they lost privacy by buying bonds directly and receiving junk Greek and Irish bonds as collateral.
    And still end of February Greek, Irish and other junk bonds will be accepted by ECB :)
    That is of course against their own statute, so many people are not realizing that ECB lost privacy a long time ago as how to explain all of this.
    If Greece default ECB will have a lot of losses and might need bailout from national central banks and EU nations (meaning taxpayers) to recapitalize ECB.
    The other option for ECB is to print money and cause inflation (or hyperinflation, who knows???) and Germany is against it at the moment.
    Is ECB going to be bailed out or will start printing money we are yet to see this year.

    So, the problem with the government debt is just going around, till majority ends in ECB hands, so we will get either inflation from printing new money or more debt back to nations to save ECB.
    This is all just fantastic and anyway we (tax payers) and private businesses (wealth) are going to pay it all.
    Prolonging all of this means we are spending our welth on central bankers, government politicans and bankers to keep them going, wasting our welth for a few more years (or many years, who knows).
    Paper money systems like this need to collapse and as sooner they do we will be better off.
    This is why I do not understand when David object that governments should not stop borrowing and issuing more bonds ????
    Is it not normal to live up to your means???

    Thirdly, David, you are correct, this is not going to end soon. The next big story might be about bailing out ECB and/or “real” printing of money and (hyper)inflation.

    • cooldude

      Some excellent points Realist. It is quite obvious at his stage that Europe is being completely controlled by the banking elites. Banks across Europe are leveraged on average 26-1. This means they own 26 times more assets such as mortgages, government bonds, consumer and business loans than they have equity. A 4% drop in the value of these assets would render all these banks bankrupt. Does anyone seriously believe that these banks have not suffered more than a 4% impairment to their assets. In America, where smaller banks are still actually allowed to fail, when they examine their books after failure they have generally suffered around a 30% impairment to their assets. I would imagine a similar if not worse situation exists in Europe but we are never allowed to find out because all the failures are bailed out by the sovereigns including our own bunch of reckless gamblers. Remember Dexia came near the top of the stress tests just months before it had to be bailed out. That is because they are all technically bankrupt and this LTRO is just a means to give them a profitable trade to keep them afloat. This is all a sad sorry mess and will end very badly. As David says we need to exit this corrupt fiasco and stuff the reckless bondholders. The European dream is now no more than a sordid mess to keep these corrupt bankers afloat. Default and then leave these moneychangers to sort out their own mess.

      • imho, all, and I emphasize ALL the books, whether sovereign or Banks, they are cooked to the maximum, which makes this particular moralizing of the Greeks such an hypocrite, ridiculous and last not least an incredible stupid act.

      • Realist

        Cheers cooldude.
        You made my day with above gold standard comments and book recommendations.

        You are correct. All should be bankrupt long time ago and resources released for useful projects.
        LTRO just moved the problem to ECB and ECB will become problem of all participating nations.

        EU is one big “Tragedy of the commons” where banks either expanded credit or will cease cease to exist.
        It is hard to tell who made the bigger mess, governments with all that debt, living unsustainably, or (central) banks with their fractional-banking credit expansion causing malinvestments and wealth destruction while sponsoring politicans.
        Politicans probably have nobody to listen than their central bankers who again following stupid economic theories and mathematicians.

        I remember Dexia and I know some other banks who almost survived run on them.
        Wholesale banking requires crazy amount of money from ECB to keep it going businesses in EU.
        This is why ECB needs to be healthy too, but with all these toxic assets and prolonging the death of criminal banking activities is not helping.

        I think the general economic knowledge is low, allowing bankers to play with politicans.
        I am sure politicans are listening to their central bankers as who else are they to follow.
        But I cannot release politicians of responsibility for this mess, especially politicans who brought central banking, removed gold standard and put many more stupid laws into place.

        This is why something substantial needs to happen in the future, not just continue the same, even after defaults. Banking need a big reform and we need return to sound money and proper growth coming from real savings, not credit expansion.
        Banks need to reduce stuff and get out of life support. The same thing for governments.

        • cooldude

          You are right Realist we cannot simply default and continue with the central bank unbacked money printing as this monetary system is fundamentally faulty. There must be a choice given to citizens to use sound money if they so wish. I don’t know if you are aware of the efforts of Hugo Salinas Price to introduce a 1oz silver coin to the monetary system in Mexico. He had a bill introduced to the Mexican congress in April of last year and despite the support of most of the deputies for it he has not been able to persuade any of the party leaders to call a vote on it. They have been influenced by the country’s central bankers. They were probably told a bomb would go off in Mexico city if they looked for a vote on it!! That seems to be the standard line with these banker elite types at the moment according to our genius Leo (not one red cent) Varadker. Anyway Hugo’s bill involves allowing a silver coin to circulate alongside the paper money. However the silver coin would not have any fixed value attached to it and it’s value would be allowed to appreciate as the paper money depreciates as it is currently doing. So it’s value would be constantly appreciating and would provide protection to ordinary citizens from the ravages of inflation. It is a simple but very practical way of introducing sound money back into a modern economy. You can get all the details at Hugo’s website http://www.plata.com.mx There is an English section with some excellent essays including “Dorothy’s Silver Shoes” which is a practical scheme to reintroduce silver money back into the monetary system in the USA. It could work in any country but firstly people have to demand the right to use sound money again. I have a feeling when this ECB thing blows up there will be a demand from ordinary people for a means to protect the value of their money. Sound money gives that protection and it is just a matter of time before this present, corrupt system implodes like every previous effort in the history of this planet.

          • Realist

            Thanks cooldude.
            As you can see many people on this forum just object. There are now almost 100 years of objections to any kind of sound money that is hard to push people to read more carefully about it.
            Central bankers are just like gods in politician minds, mathematicians and statisticians who think they know something about economy.
            It is too much dodgy economy learned on universitites nowdays that I just cannot see radical changes there.
            Placing government spending into GDP and then stating that to increase wealth you just need to give us more money to be spent in public.
            A lot of nonsense really.
            I did not hear about that Mexican silver money, but it is very interesting.

          • bonbon

            Those video’s I heartily recommend actually discuss silver too.

          • Realist

            Those that you do not know to explain.
            Explain it in words please if you can.
            In 3 sentences what is wrong with gold ?

    • bonbon

      I can understand the resistance to the Austrian School. Many politicians know what this is and are terrified of being pilloried by an angry mob. Because that will happen as they apply the School. Most would prefer to resign and let technocrats like Mister M. (Monti celebrated on Time Magazine this week) do the murderous work.
      So Austrian School v. cowards. The people loose out.

      Now President Michael D. “We have arrived at quite widespread acceptance by policy makers of a proposition rejected by the majority of serious economic historians, that markets are rational. This, on occasion, leads to the suggestion that it is people who are irrational, the markets rational. That public, for whom, Friedrich von Hayek wrote that economics are too complex, it is suggested, require something other than the direction of elected governments. They must be forces to compliance with technocratic demands, for which there is frequently scant scholarly support, and, needless to say, no mandate. This represents a challenge to democracy itself, I suggest, and to the scholarship that supports it. The mediating institutions are losing authority and the prospect of raw conflict increases all over the world…”
      ——–
      Ireland is surprising! Italy’s Tremonti has also spoken out. Many in Germany, and France also. And especially in the USA where the most extreme are found.

      • Realist

        You just need to read it really to start judging it yourself. I think you are just full of misconceptions.

        Hayek just stated that central body (e.g. central bank, government) cannot possess all economic knowledge to decide where the money should be pushed or what people want, it is up to entrepreneurs, people and market to determine such.
        The knowledge exists in som many places and so many entrepreneur heads that central body will never be able to grasp it and put by mathematical means (e.g. GDP, …)

        This is the masterpiece speech when he was getting Nobel prize in economy:
        http://www.nobelprize.org/nobel_prizes/economics/laureates/1974/hayek-lecture.html

        Read it and tell me what he said that is not true.

        • bonbon

          Nobel is indictment enough – Fischer Black, Robert Merton and Myron Scholes got the prize in 1997. This Black-Scholes Formaula was the direct cause of the LTCM disaster in 1998, nearly bringing the entire financial system down as admitted later by Sir Alan Greenspan, who had to bail it out.

          The quotes from Hayek are all accurate. His Mandeville Lecture, and Obituary by Simon are accurate – an irrationality that cannot work in modern science driven industrial society with a population of 7+ billion.

          • Realist

            The text is due to the text and not due to the Nobel Prize per se.
            He fought against mathematicians in economy, those that you put above who invented crazy formulaes.

            If you cannot understand that exchange is driving the economy. Not your stupid politicians and your stupid national bankers or central bankers.
            It is millions of people doing exchanges and millions of entrepreneurs doing businesses.

            Nothing to do with your social stupidity.
            I do not care about your stupid politicians, get out of it and finally do something useful bonbon as obviously you are either politician or central banker.

  26. Philip

    I feed you…that is wealth. I give you a gold coin..you starve – simple.

    The financial crisis has merely crystallised the fact that we are unable to employ everyone who is capable of generating wealth. Even if we threw all the credit at the world at it, the system will not sustain itself…becasue we simply do not need to employ everyone to generate the goods and services needed. Growth is the key some say. But you can grow without an extra net job being generated – so clearly that is wrong.

    Greece is a tertiery industry country. It’s just tourism. Germany is a primary and secondary industry country. Being one of the very few in this regard it supplies other countries. So there will always be a deficit. No amount of tourism in 5 years will pay for all those BMWs/mercs bought in the first of those 5 years – the value difference is just too vast.

    This is the conundrum we are facing and wondering about Greece’s destiny or the EU destiny without first figuring out how the actual debts will be flushed out due to the massive industrial imbalances which esist thro’out which will casue massive middle class erosion is pretty pointless.

    U kill the middle classes…medievalism is not far behind.

    • Eireannach

      If Greek falls out of the eurozone and it’s new drachma is rather worthless, then they’ll become poor alright, and dependent on tourism with a high level of youth unemployment.

      In other words, Greece will end up where Tunisia is now.

      But Tunisia is already in that place. Why should Greece be “entitled” to be richer than Tunisia? The business class doesn’t pay tax, they habitually lie to their eurozone colleagues. They are more Tunisia than Germany in every possible way.

      Then you have Egypt, WAY down the food chain from Tunisia.

      Then you have Sudan, WAY WAY down the food chain from Tunisia and Greece.

      When you look at the current state of Africa alone, all of it, every inch of it, raising the alarm that the European periphery will become “medieval” looks rather naive. We have a long way to fall yet – it’s only begun for Europe’s periphery.

      • redriversix

        Africa is the result of a poor Western experiment that failed and they continue to keep the downtrodden down.

        Greek books were cooked to allow entry to Euro and they are still being cooked today.

        Be careful in the Ivory tower , Eireannach , its a long way down…………..

        • bonbon

          Africa today is the result of Sir Henry Kissinger’s NSSM 200, policy of 3 US administrations. This document is available now after FOI. A clear manual of economic destruction. “Confessions of an Economic Hitman” has an NSA insiders detailed view of more countries.
          Taken together it is a continuation of the British Imperial policy, everyone thinks vanished…

    • bonbon

      “Road to Serfdom” – von Hayek, Austrian School, LSE.
      “We shall not rebuild civilization on the large scale,” “It is no accident that on the whole there was more beauty and decency to be found in the life of the small peoples, and that among the large ones there was more happiness and content in proportion as they had avoided the deadly blight of centralization.”
      ——
      So a clear strategy for a return to feudalism, and reduced population, taught today as “economics”.

      • Realist

        Did you read the book ? I know the answer, it is NO.
        That book is about debunking socialism.
        From your post I can see you are a socialist, so no bother commenting your wrong statements.
        Hayek is for free-market capitalism free from state grip that is making it socio-capitalism.
        I lived in socialism and know exactly their failures. The last thing I will fight in Ireland is for socialism, sorry bonbon, you will be the past I hope.

      • bonbon

        Actually Hayek is not about “socialism” — something totally different is going on. He lumps Hitlers “statist” economy with List, Rathenau, in fact with any central economy. Menger the School founder, lumps List with Marx, Lenin and Stalin! Then Hayek attacks Polytechnic Monge and Carnot! Then Hayek lumps Carey, List with Saint-Simonists!
        All of this is very well documented.

        Socialist? Totally wrong. I take Friedrich List’s American System of Political Economy, like Arthur Griffith did, as correct.

        • Realist

          Where it is documented please ?
          Not here:
          http://en.wikipedia.org/wiki/The_Road_to_Serfdom

          People can find everything about Hayek and austrian economy as it is mostly all free, books, references. Internet is the best thing to debunk your stupidity, so get over it bonbon.
          Almost all books are free on mises.org for everybody to find things you are talking about and all is searhable in google, so please give us some arguments and references or shut up!!!!!

          • bonbon

            Can you find any comment on Friedrich List or Rathenau, Carnot, Monge, Polytechnic by Hayek?
            That quote above is directly from Road to Serfdom.
            “The Counter-Revolution of Science” has a chapter attacking the French Polytechnic.

          • bonbon

            Avoid the abridged versions. The last chapter proposes an international police force “authority” to enforce free trade. Totalitarianism disguised as liberal.

          • Realist

            Lies like usual.
            Your socialist crap bonbon.

  27. Greek Trajedy

    We need a collective for an infinite number of political fudges ….any takes?

  28. - According to EUROSTAT, 28% of Greeks (around 3 million) live under the poverty line. Now, that was in 2010!

    - Athens has 25,000 homeless people.

    - In Europe, Greece used to have the lowest suicide rates. In 2011, 6 suicides for every 100,000 people occurred

  29. thejeckel

    Is David pissing on an electric fence? Article 140 Eu legislation, the euro is irreversable? Did anyone see Hardtalk on BBC News 24? Would like to see David under the cosh in this program!

  30. goinghome

    ‘Uneconomics’: sounds like something that’d go well with punkeconomics as an approach that challenges institutional assumptions at their very routes -
    http://www.opendemocracy.net/ourkingdom/collections/uneconomics

  31. Alan42

    It really is amazing what was once considered outlandish can become normal and accepted .

    There was NAMA . It caused outrage at the time but is now just accepted . The same with the IMF taking control of Ireland . Not only has Ireland accepted it but seems to have developed Stockholm Syndrome .

    Listen to all of the negitive reporting on Greece . ” they don’t pay taxes , they shoud never have joined the Euro , should be booted out , need for massive reforms ” it is an interesting contrast with Kenny in NY .
    http://bloom.bg/yG8rA0#ooid=ZmaWJoMzp1QvBoOdoDPjaouXfT43z8VV.

    We are happy , indeed more than happy to take money off autisic children to pay off bondholders of a debt that is unsecured .

    Look at this guy http://www.independent.ie/national-news/meet-the-financial-whizzkid-betting-4bn-on-our-economic-recovery-3014670.html

    The bonds were sold at a discount by investors who did not think we would repay in full . If the market sells your bonds at a discount , have they not just accpeted that Ireland won’t pay in this instance ?

    Why would you be repaying every last cent when your lender has already accepted that you won’t ?

    Pride ? Stupidity ? Or to hold a big march past the GPO in 2016 ?

    Amazing stuff .

  32. bonbon

    Mario Monti arrived in the US today, Time magazine ran its international edition dedicated to the Italian puppet Prime Minister. Mister “M.” has an illustrious predecessor on an apologetic cover of {Time}: another Mr. “M” in 1936. Both “Mr. M”s have been presented as Men of Providence, Who Can Save the World.

    Like Mussolini, who wanted to turn Italians “into a people of warriors,” Mr. M. says in his {Time} interview that he wants to change the character of the Italians. Asked whether his government wants to change “the culture and a certain way of living and of working of Italians,” Monti answers: “I hope I can do that, because I am convinced that otherwise, structural reforms would be at least [sic] ephemeral.”

    Obama lauded Mr. M for his “stewardship,” and “knowledge of economics” and how he has “boosted confidence in Italy, Europe, and the marketplace.” (A lot more was said in 12 minutes).

    Meanwhile, Interior Minister Annamaria Cancellieri, stated that the cause of youth unemployment in Italy (over 30%) is that Italian youth “want to find a job close to mama and papa.”

    ———–
    This takes the biscuit. Now Mama and Papa and family are the cause of the economic collapse! What economic thinking!

  33. rebean

    Apparently Ireland has no prearranged funding for 2014. Thats seems to be the ultimate end game and we will be having days and sleepless nights like Greece.I have heard that the Govt are now trying to do a deal with the EU regarding repayments of Anglo Bonds. If they can save the nine billion owed then they can pay back the ten billion owed in 2014.We in fact owe 19 billion at that point give or take a billion. Maybe someone can comment on these figures. I was correct with the figure of ten billion owed by the end of 2013 I believe. Cannot see Ireland having the money to pay all this. Probably another bailout on the way. Alot of arses to lick in Europe yet I reckon

    • molly66

      What happens to us if we need a second bailout are we going to be treated something like Greece .
      I think we will need a second bailout,the government say we won’t ,I don’t believe them and one thing is for sure if we do maybe that will be the kick up the arse the Irish people need.

  34. redriversix

    Bye Bye Greek Euro Hello Drachma………

    We will need a second bail out Molly based on the scientific conclusion that the Government claims we won’t !

    • bonbon

      There is no “Greek Euro”, only “Euro”. Bye Bye Euro.

      All good science starts by going after the oligarchy, as Ampere well knew.

  35. Grey Fox

    Greece’s largest police union has threatened to issue arrest warrants for officials from the country’s European Union and International Monetary Fund lenders for demanding deeply unpopular austerity measures.

    In a letter obtained by Reuters on Friday, the Federation of Greek Police accused the officials of “…blackmail, covertly abolishing or eroding democracy and national sovereignty” and said one target of its warrants would be the IMF’s top official for Greece, Poul Thomsen.

  36. rebean

    I read that article in the Independent recently about Enda and Sarkozy and the so called Horseplay episode.I reckon there will be alot of Horseplay in Europe yet. It wont be the type of Horseplay Enda Kenny is used to.

  37. bonbon

    Merkel’s insane policy of Greece-bashing Angela Merkel has made her the “fall guy” for the British Empire.

    The FAZ {Frankfurter Allgemeine Zeitung} today reprinted the front page of yesterday’s Greek daily {Dimokratia}, whose headline read in German: “Memorandum Macht Frei” featuring a picture of Merkel in an SS uniform right next to it.

    The paper’s main commentary, as in today’s {Der Spiegel}, is that everybody should be clear that none of this can work, if for no other reason than that the Greek economy is collapsing.

    Senior {FAZ} journalist Günter Nonnenmacher writes that it’s just a matter of calculation, whether a Greek state bankrupcty or its (in)voluntary exit from the Eurozone will be less expensive for Greece, and its creditors, both private and public.

    • Malcolm McClure

      Bonbon still somehow manages to relate every problem, everywhere, to the machinations of the ‘British Empire’. He thus destroys the credibility of any argument he makes on other subjects.

      Get over it bonbon. It doesn’t wash. It’s dull as dishwater, boring, crap.

      • Adam Byrne

        I agree. You need to refine your posts Mr Bonbon or just give up because no one is listening. The delete(without reading) button in my email has never been as busy.

        Then again, it’s up to you. Not my job to ‘censor’ you but I certainly don’t have to read you.

        Adam.

      • bonbon

        It is not boring for Buenos Aires. Just in case someone says this is OT, empires are by definition not limited to any national boundary. Why has Britain as much firepower around Malvinas as in the Persian Gulf?
        The Empire’s financial system is totally finished, and the reaction predictable.

        Argentina: the South Atlantic “Is the Last Refuge of a Decaying Empire”

        In a meeting with UN Secretary-General Ban Ki-moon, and with the president of the UN Security Council Kodjo Menan, Argentine Foreign Minister Hector Timerman delivered his government’s official protest denouncing Britain’s militarization of the South Atlantic, which includes the deployment of a nuclear submarine with nuclear weapons, as well as of the ultramodern HMS Dauntless destroyer.

        Speaking to the press following his meetings, Timerman showed pictures of the nuclear submarine Vanguard, capable of transporting nuclear weapons, and warned that “Argentina will not accept the existence of nuclear weapons in a Latin American zone of influence.

        The information Argentina possesses is that [UK] has introduced nuclear weapons into the South Atlantic, and it isn’t the first time.” This action is a violation of the 1967 Tlatelolco Treaty, which prohibits the presence of nuclear weapons in Latin America and the Caribbean, he warned.

        • Malcolm McClure

          Bonbon simply regurgitates the typical Argie dog-in-the-manger response prompted by recent Falklands oil exploration.
          Like bonbon, realising they are on shaky ground, they switch to victimhood.
          Pathetic.

    • bonbon

      Interesting that this reference “The British Empire” does bring out certain failures of temper? I know many do not want to offend the British Empire, and try all kinds of contortions and funny reasoning to “explain” what is going on.

      The KISS principle at work.

      Anyway as this crisis intensifies, and it will as we all now here, the “invisible hand” will become apparent to even hysterical deniers, like “Kirkalloway in a bleeze” to paraphrase Robert Burns.

      The empire is very predictable, its next move is already underway while we blog…

      • Malcolm McClure

        Just two points:

        Persistent blathering about the ‘British Empire’ is redolent of Nkrumah and LSE students in the late 1950s; it has nothing to contribute to the Eurodebate.

        And–ah, yes: “Deniers” –the ultimate pejorative of victimhood.

        • bonbon

          I would’nt call Tam o’ Shanter a victim.

          European nations have lost their sovereignty. That by definition means to an “empire”. It’s as simple as that. The Euro was a tool to remove the last vestige, an imperial monetarist tool.

          Which raises the question – what is this “empire”. It’s the same old one all the time. It does in fact resolve the muddle.

          To recover sovereignty, meaning to shove the empire, Glass-Steagall is the way to split the monetarist tools. That will resolve the Euro fiasco as a side effect.

  38. bonbon

    Here is an initiative that must interest Eire. The Arctic is opening up at the the same time things are falling apart. Apparently this came up during the defense conference last week in Munich.

    http://carnegieendowment.org/2012/01/31/euro-atlantic-goals/9bwd

    Empires always collapse – look at the archaeo record. We need a better way.

    • bonbon

      Euro-Atlantic-Security-Initiative from Wolfgang Ischinger, Igor Ivanov, Sam Nunn.

      • bonbon

        Igor Ivanov, former foreign minister and still a senior voice in Russia’s foreign policy establishment.

        This follows the call for a Strategic Defense of the Earth, SDE, Oct-2011 by Dmitri Rogozin, then-Russian Ambassador to NATO.

        With all the warmongering over Iran, Syria, etc, this is blocked out by the media.

        Russia is proposing alternatives while EU-USA “elites” are hellbent on suicide.

        • Malcolm McClure

          Talking to himself again, but not quite ready for sectioning.

          • bonbon

            Breaking news, I fill in the details as I get them.

            The Arctic is where it’s at.

            Eire is located exceptionally well to handle large container ships with a new deep water Shannon harbor. Then a tunnel to the UK (hopefully free of the decayed British Empire) to link to the mainland via a second “Chunnel”.

            There is life after the British Empire and it’s Euro fiasco.

          • Colin

            bonbon, why noy bypass old blighty altogether and go for tunnel between cork and brittany?

    • bonbon

      @Colin, the real question is why shipping traffic right now concentrates to Rotterdam, then onto rail. The Channel is choked. The monster ships now appearing, need a special harbor.

      • Colin

        What location do you propose to take business from Rotterdam? Does this location have the infrastructure to move goods to and from the port to markets and from production plants the same way Rotterdam has?

      • bonbon

        The idea is to handle the mega ships that access the Arctic at Shannon, then rail to the tunnel to the UK, rail then to a new Chunnel to near Rotterdam which has the infrastructure. This takes the load off the shipping lane which is saturated.

        • Colin

          Non-runner.

          As Deco has pointed out, and a fella called ‘b’ here a few years ago pointed out, Iarnroid Eireann actively discourage freight on rail. They don’t wanna know, too much had work involved in changing timetables and refurbishing lines and hiring staff and all that.

          And then you would have the enormous cost of the tunnels, which would need to be passed on to the customer, who would find it far cheaper to simply use Rotterdam.

          And then you’d have the time frame, how many years would we have to wait for it to get up and running?

          And needing the British onboard, why couldn’t they just turn around and say, no thanks, but we’ll use Liverpool, or Bristol, or Newcastle, or Hull or Southampton and then build a shorter tunnel to Belgium.

          Bonbon, you’re in cloud cuckoo land if you think this is a worthy way to spend money.

        • bonbon

          I think you have not let sink in what the total financial collapse really means, especially for the UK. True these projects will not fly with the current decaying regime which you describe as someone within the bubble.

          “Enormous cost”? Let it sink in what the LTRO is trying to do.

          Also start thinking in terms of physical economy, I know for Tigers a real challenge after years of monetary brainwashing. What kind of a harbor do the new carriers need? What does the Arctic mean?

  39. bonbon

    The focus on Sweden has appeared here a few times now. Is it supposed to be some kind of model for Europe? Or Greece?

    It looks more like Argentina is the model for Greece to follow (mentioned here a few times too).,

  40. bonbon

    While U.S. Senators refuse to match House Bill HR 1489 for Glass-Steagall bank seperation, Italy’s Senator Peterlini has submitted one :

    Senate of Italy
    XVI Legislature
    Bill No. 3112
    Presented by Senator PETERLINI
    Communicated to the President’s Office on January 25, 2012
    Delegation to the Government for the Separation of Ordinary and Speculative Banking Activities.
    ….
    With Draghi, “Mr M.” Monti, Papademos, all of Goldman-Sachs, installed one after the other, carrying out here British policy to erase even a trace of sovereignty world-wide, Senator Peterlini, opposes this and defends Italy’s sovereignty.
    Like the 1933 FDR Glass-Steagall bill it is clear concise and short (unlike the swiss-cheese Dod-Frank concoction that replaced it).

  41. redriversix

    Morning David ,
    When [If] Greece defaults or withdraws from Euro next Week ,how many French / German Banks could be collapsed ? or will the “borrowed” trillion euro rescue fund provide the firewall it was set up to do anyway

    Appreciate your thought on this……

    Best
    RR6

    • bonbon

      These banks need Euro 5 trillion at least this year alone. The 1 trillion is merely Feb.
      That is 5 more than in 2011. Who knows what they will say by March?

      • redriversix

        Whatever they say , it will be lies BonBon.

        you can bet the farm on it…….!

        • bonbon

          Which means what they actually do and think is not what they say. What a muddle! They fear the Rating Agencies, the Troika, the voters and unions, and maybe even the Church (shutting the embassy)!

          Bunker mentality!! To the last second as the place is flattened, huddled together spouting catch-phrases.

  42. bonbon

    Italy’s Tremonti Pushes FDR and Glass-Steagall on ‘Servizio Pubblico’ Talk Show, the same talk show where Claudio Giudici first raised the Glass-Steagall issue. Giudici was reported in the FT.

    Tremonti hammered on the FDR example, explaining clearly that the two actions to be taken must be
    1) Banking separation after the Glass Steagall model 2) A New Deal-like program of state-financed infrastructure investments.
    Tremonti said that when he wrote the book “Emergency Exit”, he thought he would stand alone with those ideas, but luckily, things have moved a bit, so that now in both Germany and France, the Social Democratic parties have adopted a Glass-Steagall proposal.

    Tremonti also blasted the EU/ECB austerity policy.
    uring the show, excerpts from the movie “Inside Job” were shown, and Tremonti was questioned by journalists and “outsiders” in studio, including “autonomist” leader Luca Casarini. One journalist, Enrico Mentana, emphasized the importance of Glass-Steagall, whereas another one, British agent Paolo Mieli, could not attack Tremonti frontally, and chose to say that Tremonti’s analysis of what he calls “White Fascism” is correct, but the evaluation is controversial (i.e., Mieli likes fascism).

    The recognition of Giudici’s primacy over the Glass Steagall issue has been tremendously increased after this and other public appearances by Tremonti, as confirmed by reactions among his constituency.

  43. redriversix

    Minister for state, Brian Hayes T.D on rte Radio this morning repeats the mantra “Ireland is in a better place then it was 12 months ago”!!!!!!!!!!!

    How are these people allowed to contiue these lies unchallenged ?

    Regarding Retirement Transition teams to deal with mass retirement of Public workers………

    Enda states their are teams in place to deal with this.

    Alan shatter says he is not aware of any term in his Department

    Brian Hayes says teams in place since last Autumn.

    Enda says Teams will ne organised,set up and finalized in Dail meetings next Tuesday !!!!

    Enda claimed last week we have never, nor will we seek a cut in debt repayments… “we will not have defaulter written across our forehead”

    Lucinda Creighton claims “we have looked for reduction on debt/promissory note [debts]several days later

    We are not “doomed”because of debt , we are doomed because of these incompetent , unqualified buffoons who will lead us to social destruction.!

    But what can we do ? I know.suck on it

    assholes,no other liberal term required

    • bonbon

      We are not doomed, the Euro and transatlantic financial system is a dead man walking the green mile.

      So they are going to go for all out war. If even an inkling of that shone in the minds of FG/LP is unknown.

      Better to let the people know what is underway. Then politicians would in fact get support for actions to counter this. They should talk to the people, like FDR’s fireside chats “Let me tell you about Banking”.

    • molly66

      Brain Hayes td is right things have improved for the government and all there pals ,but not for us so he lives on a different planet we need a change of government now .

      • redriversix

        Afraid a change of Government will no longer cut it Molly66………

        this disease is ingrained in the system and as we have seen over the last 13 months ,it is Senior Civil servants who call the shots.
        Governments now , more than ever seem to be a front for organised crime….no other way to describe it.It seems the only way to rise to power in this or other Countries is to prpogate lies and untruths as they are handed out like press releases.

        The Evidence is hiding in plain view , you could make an excellent you tube vidro highlighting the above for the last year.

        Oh ,

        • redriversix

          @should read.. “propagate lies and untruths”

          • molly66

            Yes I agrees senior civil servants and the government fall from the same rotten tree,there must be some way to get rid of these shower.

        • bonbon

          When sovereignty is erased, the last shred with the Euro, the Gov’t has no function – the “empire” handles that. So of course a bureaucracy takes over. This is “governance”. In other words the elected are posters, are regularly checked to remain so, and Empires always have such a bureaucracy. Things are really falling into shape!

          So Dublin is right back to before 1921 – home rule, seats at Westminster maybe…, every variation already seen.

        • That sums it up RR6.

          Remember when the representation of the most senior cicil servants in this country sent a letter to Lenihan, refusing to take cuts, and presenting themselves as generous not to demand more money after all. As a direct reaction they were exempt from these cuts.

          One Anonymous commentator over on Dr. G’s blog had this to say:

          …”The powers of financial capitalism had another far reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements, arrived at in frequent private meetings and conferences. The apex of the system was the Bank for International Settlements in Basle, Switzerland, a private bank owned and controlled by the worlds’ central banks which were themselves private corporations. The growth of financial capitalism made possible a centralization of world economic control and use of this power for the direct benefit of financiers and the indirect injury of all other economic groups”….

          All I can say to this comment is….Bingo!

          • redriversix

            by Jingo , ! it certainly is Bingo……………your comment,Georg is what is happening …………….exactly

            Best

  44. bonbon

    “Once the world sees that there is life after the euro, as there was after the Gold Standard and lots of other now defunct currency arrangements, the financial markets will ponder who is next.”

    I agree there is life after the Euro, but the Gold Standard item that keeps cropping up needs some elaboration. AFAIK in 1971/72 Nixon killed the Bretton-Woods system because of perceived pressure by Britain and the Gold Standard. 1972, the Inter-Alpha banking group was formed starting the derivative snowball now hitting.

    I think there is confusion about what Nixon did and what Bretton-Woods meant. For instance FDR’s 1944 conference blocked every attempt by Keynes to define policy. That changed with Truman, but Bretton-Woods remained in effect.

    So life after 1971 has been an economic and financial nightmare. No economic growth, exponential financial “growth”.

    There is life after the Euro, but in order to avoid catastrophe radical severe measures must be taken.

  45. goldbug

    ITS NOT WHO HAS THE VOTE

    ITS WHO OWNS THE DEBT…..

    AAA GONE PENSION + INSURANCE FUNDS DUMPED LONG AGO

    SOLD FOR LOSS TO BOTTOM FEEDERS

    BUY FOR PEANUTS…. GET TOP DOLLAR FROM BAILOUTS!

    WHAT A BARGAIN

    PROFITS RISE..MARKETS SOAR ATHENS BURNS

  46. Philip

    If I may re-state a wondeful article in the weekend’s IT – IT’s NOT THE ECONOMY STUPID. We are going to have years and years of growth….lots of it. We’ll be 50-100% bigger in economics/ accounting terms in 10 year’s time…3-5% growth….JOBLESS GROWTH.

    The fact that the youth of much of the developed world (30% and rising – depending on where you look) will remain unemployed and become more unemployable is a very dangerous development and one which demands a histrionic level of attention. It is a profoundly disgusting state of affairs that with so much to do, we cannot positively leverage our young people in dignified and satisfying work. These are impressionable people and the messages of the increasingly elder among us will start to fall on deaf ears.

    • bonbon

      What’s the message then?

    • Colin

      Everyone is a me feiner these days Philip, mind yourself and your family first is the new mantra. Screw the young people at every chance. Its the old story of the old being full of envy of the youth, all that twaddle about youth being wasted on the youth. We’ve menopausal women trying to turn the clock back, getting fake tits fitted, and ringing into Joe Duffy to look for sympathy because they might be toxic after all. Caveat Emptor.

      We’ve unions looking after union members, and union members only, screwing the rest of society who often didn’t have the luxury of joining a union because they worked for an American multinational here in Ireland.

      We’ve the OAPs who are still asset rich and still cash rich, threatening all kinds of things if their free medical card is withdrawn.

      We’ve drug dealers making a fortune, unable to be touched by the Guards, and only thinking about themselves and how much money they can earn.

      And then we’ve the farmers, our auld pals with the hand out, stretching all the way to Brussels.

      Publicans who make a fortune as there is a cartel in effect when it comes paying for a new pub licence, you have to buy an old one for over €100,000 on the market from an old codger who made his fortune selling drink to the people.

      Its the Republic of Me Fein.

      • bonbon

        Och ochón agus ochón ó.

      • bonbon

        I note a pattern here.

        DMcW posts an interesting theme, and certain people here want to outdo each other in wailing, chain rattling, like banshee’s!

        That’s very old fashioned I would say.

        Not what the people want to hear now.

        • Grey Fox

          AGREE!!
          What the ordinary Joe Soap wants is accountability, equity, fairness…with the banking elite now moving on the political arena i.e. replacing democratically elected represention with bank cronies this is the final piece of the jigsaw.
          Just like the Household Charge: an invitation to pay!!!
          If you give a man the ability to work he will excel, feed his family and live his life and mind his own business, trusting that the Public representatives he has voted for will look after his overall interests and the interests of our Sovereign Republic but when you take away a man’s ability to work, he can’t feed his family and will therefore make it his business to find out WHY!!
          When the Public representatives sell out to Banks and big business, sell our sovereignty to the highest bidder for their own personal gain (shortsightedness),
          Well then, the ordinary Joe Soap will put up with it for so only so long and then the Banks, Big Business and Corrupt/Self Serving Politicians will reap what they sow -Destruction!
          And before anybody retorts with “yap yap yap same old same old” I believe if it was possible to have a snap poll of everyone in the country the results would be frightening, the key is the voice in the wilderness which unites all the individual Joe Soap’s, and that voice is out there of that you can be sure, history has shown it again and again, in relation to our little country they were the likes of Jim Larkin, Michael Collins, James Connolly etc…more recently, the voices of the Clerically Abused, the truth always prevails the only question is the level of damage perpetrated in the interim, a liar and a cheat is always ultimately found out, FG/Lab are deluding themselves and have learned nothing from the reign of FF. Europe was a lofty ambition the Euro even Loftier and admirable in some ways but the horse is long dead, no point in flogging it anymore, the fight is now over the carcase and to my mind they can have it ‘cos its rotten to the core.
          It is getting to the point where anything would be better than where we are now, I bet if you ask any rightminded greek in Athens today what they want the answer is “anything other than this”
          PRESS THE RESET BUTTON NOW!!

          • cooldude

            Excellent article Grey Fox. We do have to start again in every way. Unpayable debts will have to be written off right across the whole spectrum from individual to company to sovereign. This is where it will eventually have to go. The only people who will be hurt when all this default occurs are the .001 banking elite who are running the whole show and are obscenely rich anyway. These are the elites behind the scenes who want us to be happy little debt slaves and just to what Enda tells us. Reset, default, start again and give people the choice to use sound money if they want. Sound money is the only way to protect ourselves from the bank vampires who are intent on sucking us all until we die.

You must log in to post a comment.
× Hide comments