RSS Output
French    German    Spain    Italian    Arabic    Chinese Simplified    Russian

Letters by a modern St. Ferdinand III about cults

Gab@StFerdinandIII -

Plenty of cults exist - every cult has its 'religious dogma', its idols, its 'prophets', its 'science', its 'proof' and its intolerant liturgy of demands.  Cults everywhere:  Corona, 'The Science' or Scientism, Islam, the State, the cult of Gender Fascism, Marxism, Darwin and Evolution, Globaloneywarming, Changing Climate, Abortion...

Tempus Fugit Memento Mori - Time Flies Remember Death 

Back     Printer Friendly Version  

Bookmark and Share

Thursday, May 17, 2012

The ECB goes bankrupt. The next phase of the systemic crisis.

Brought to you by loving caring compassionate socialism.

by StFerdIII

 The Great Recession is heading into its second phase. This was predicted back when the first phase began in both the US and Europe. Governments and their distortions of real estate and associated finance caused the first phase. Governments and their addiction to socialism will cause the second phase. In particular the locus of the next crisis will of course reside in Europe, but it shall spread. Spain, Italy, and even France are at risk of fiscal implosion. This will devalue the Euro on a path to zeuro, cause a bank run, and destabilized international banks and markets. This will lead to more government distortion and involvement, worsening the situation and leading to further economic contraction in the major economies.

The reason why the Euro crisis will damage the world economy, is that the ECB will be bankrupted and will have to be capitalized. When Greece exits the Euro, it will cost the ECB about $1 Trillion. This will be due to the hundreds of billions of loans that French and German banks will not collect as Greece defaults, and the ripple effect that this will have on the bond and capital markets in Spain and Italy. The Spanish bank-state fiscal imbalance is about $500 billion. Most likely Italy has the same scale of insolvency. There is simply not enough money that one can print or tax to pay the Trillions needed to 'save Europe'.

When Greece goes, the Euro will rapidly decline and focus will turn to the under-capitalized and at risk Franco-German banking system. Spain and Italy will come under further scrutiny, and their real debts [not the stated government debt] will be a major concern. The $1 Trillion in ECB grants and supports, already committed by member states will have to double. This will prompt another Continental-wide financial crisis. The IMF will be 'forced' to try and steal [at gunpoint], money from OECD member states to finance a Euro bailout. They won't get a dollar from these states. No one is fool enough to bail out Europe – soft power and rhetoric, along with unfettered socialism must have its consequences.

Zeuro-zone politicians will of course not cut spending [austerity does not exist it is a propaganda myth], and will demand that the ECB simply print pretty pieces of paper [which some call money]; give it to their national banks [national 'champions']; who will then recycle it back to state governments [to fund the EU-topia]. Or the ECB, in contravention of the Maastricht Treaty, might feel inclined to offer a direct bailout to states who will then, 'save' their banks with devalued currency. Neither policy will work.

At some future we will likely see the implosion of the ECB. Not even the Euro-crats believe that they can manufacture coloured papyrus and declare it to be worth something, while maintaining with a straight face that there will never be any future inflation worthy of the name [things are different; things have changed; this is not 1921 etc. etc]. When Greece goes it will become apparent that the ECB is under-capitalized. But what can be done? Quite likely a plurality of the population at large also realize that you can't print money forever, or steal assets [taxation] without repercussions. Europe has been a no-growth empire for 20 years. They can't tax their way into prosperity, and they certainly won't cut spending. Printing money will soon not be an option. The ECB is and will remain under-funded. It will probably cease to exist in its current form. Welcome to phase 2 of statism and its consequences.  

Article Comments:

Related Articles:

Cult of Euro Socialism

12/20/2019:  Brexit, The Illegal Invasion, Financial Bankruptcy and the eventual implosion of the German Empire

6/27/2016:  EUtopia's quite easy to predict collapse is finally starting to occur

6/22/2016:  Exit the EUrinal - a socialist tyranny and immoral project

6/21/2016:  Brexit, Dismantle the EU beast, get back to basics and real progress

6/18/2015:  Greece should leave the ZEuro zone. Greece is Europe, Europe is Greece.

9/11/2014:  The Euro is still way over-valued. No good reason for its current exchange rate exists.

1/10/2014:  Europe will lead the next great implosion and 'recession'

3/18/2013:  Cyprus and the EU Topia. Bankruptcy will induce government theft of savings and retirement funds.

6/13/2012:  Europe's flawed and failed Monetary model.

6/1/2012:  The EU fantasy project. Cultural and political-economic suicide.

5/28/2012:  The systemic risks of the Euro zone

5/17/2012:  The ECB goes bankrupt. The next phase of the systemic crisis.

5/14/2012:  The road to ruin runs to Paris.

5/9/2012:  The Euro's ultimate failure.

5/1/2012:  Europe's 'Austerity' Myth.

2/21/2012:  The Zeuro – another day, another 'bailout' which will never transpire

1/16/2012:  European Mayans. The not so new Neolithic.

12/13/2011:  The Vikings are cutting back their Nanny State.

12/6/2011:  Ever distant Europe - fragmentation not unification

11/29/2011:  EUtopia - ever closer union and bankruptcy

11/2/2011:  Greece needs to exit the Zeuro zone

10/28/2011:  Markets, Media and The Zeuro Zone

10/27/2011:  Europhoria – more rhetoric, more debt = happy times.

7/13/2011:  The Leftist-Socialist reaction to the Zeuro`s demise.

7/2/2011:  The Greek and Euro tragedy dragging on and on and on...

6/29/2011:  Greece should default and leave the Euro

6/20/2011:  Why does the Euro 'have to' survive ?

5/24/2011:  Why is the Zeuro at a 40% premium to the U$?

5/10/2011:  ZEuro and the nexus of corruption

4/26/2011:  ZEuro Death Alert: 2013 and the public debt crisis

4/13/2011:  Euro: Spain and the risks in the EU banking sector

4/13/2011:  21 countries most likely to go bankrupt

1/25/2011:  The Euro might not be a ZEuro ?

11/27/2010:  The ZEuro death alert. How long until it implodes?

11/23/2010:  Core vs. Periphery – the EURO scam.

11/12/2010:  The collapse of Europe ? If you believe so, short the Euro.

7/14/2010:  France: A history of high taxes, despotism and denial of freedom

5/10/2010:  Welfare Socialism: The Euro is too big to fail !

1/20/2010:  The embarassment of being Dutch. Geert Wilders being tried for 'hate' againt the Moon Cult.

5/4/2009:  The Long European war against the individual

3/1/2009:  Europe's massive economic collapse.

9/18/2007:  European values – harass, harry and fine successful non-EU companies!

3/13/2007:  Europe's economy is 30 years behind the US

2/15/2007:  European lies about unemployment rates

5/25/2006:  EU socialists and their UN friends appeasing Islam

4/22/2006:  Socialism, High Taxes and Arrogance

3/20/2006:  Milosovic's death highlights the poverty of European soft power

3/18/2006:  Lessons from Milosovic, the fascist leader and the illogic of fascist war

3/8/2006:  Soft Europe

3/2/2006:  Germany run like GM

10/3/2005:  European Politics – a collection of incompetence

6/27/2005:  The Boys from Brussels – Androgenists Unite !

6/1/2005:  France and Holland Get Smart

5/25/2005:  Problems with the EU Constitution

5/25/2005:  EU: Eastern Expansion – Analysis of why it is happening

5/25/2005:  Challenges to the EU and its brand of Statism

4/25/2005:  EU – Rejects Market Reforms

12/17/2004:  EU vs. USA - Socialists Unite in their Fantasy

12/15/2004:  Germany is not the Power it should be