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Guest Post: Euro Until The Endsieg
Submitted by Toni Straka of Prudent Investor
Euro Until The Endsieg
Breathless but futile discussions about the creation of a new layer of debt in the form of Eurozone bonds are going nowhere. Jean-Claude Juncker, head of the eurozone group of finance ministers, now clashes with France and Germany who both reject the proposal as it would raise their financing costs.
On Thursday he said in Germany's main TV news "Tagesschau" that Eurozone governments would have to finance 40% of their debts via Eurozone bonds, which would lead to a northward conversion of German yields with their weaker Euro brothers in arms.
As the Euro dream has rapidly mutated into a nightmare for Greece and Ireland, with Portugal and Spain to follow for sure, I note a fatal tendency in EU circles to hold out for the Endsieg despite all the contrary evidence pointing to a not too distant disintegration of the common currency.
The term Endsieg was first coined by immortal social-libertarian Austrian politicial critic Karl Kraus in 1918 - he was the official Austria's pain in the a.. a century ago with his weekly newsletter "Die Fackel" - and was hijacked later by Adolf Hitler's propaganda minister Joseph Goebbels.
'Endsieg' became part of the Nazi doctrine before the ultimate downfall of the Third Reich: Temporary losses (including of civilian lives) notwithstanding, the 'Third Reich' would ultimately prevail, and thus any breakdown in allegiance to Nazi ideology was not to be tolerated. This conjuration of final victory became more desperate in 1943 when allied successes forced Germany onto the defensive. Joseph Goebbels still spoke about the 'Endsieg' as late as March 1945.
The Euro propaganda ministry in the European Central Bank in Frankfurt frantically tries to implant the similar wrong belief that all is right with the Euro. What charts do they watch?
Maybe they take a look at ActingMan.com whose very nuanced Austrian view of the Euro's death spiral arrives at an entirely different, bleak, picture.
National politicians in many EU countries, whose borrowing costs will shoot to unaffordable levels after the first sovereign debt default next year, still appear to draw a complete blank on the severity of the financial crisis that finds its roots in too much credit and too much leverage. The times of cheap debt are over and bond markets have topped out with a high probability.
This complete cluelessness is repeated on the EU level. Just follow the MEP's aggregated Twitter feed to have a real-time insight into their thinking - and take your own clues.
Mutual political calls that no Eurozone member will default echo the same despair as can be heard in the calls for the Endsieg 65 years ago.
The facts speak a different tongue.
Europe suffers from 3 major structural problems that will not go away:
1. No resource reserves
2. An aging population
3. Highest labor costs in the world
Add in the financial crisis, the economic slump and the fact that we have yet to see a first major default among overleveraged European cross-border banks and the hope for an Endsieg on behalf of the official actors becomes comprehensible. One hopes for the Endsieg when one knows that the other option is too ugly to just think about it.
Here is a reminder that this other - yet to be named - option has a better chance than the Euro's Endsieg. Mind you these are only today's intra-EU conflicts and troubles, compacted by openeurope.org.uk in a daily email:
- Juncker calls Merkel simplistic and un-European, and accuses her of not even studying his proposal before rejecting it;
- Merkel says Eurobond was bad on economic and legal grounds, and says her quiet response is intended to bring calm into the debate;
- German coalition sources accuse Juncker of making a proposal which would have zero costs for Luxembourg;
- Germany’s five-year auction flop – the third auction flop in a row – as 10 year yields rise above 3%;
- Brian Lenihan says bondholder default is not an option for Ireland, unless it was supported by the EU;
- Strauss Kahn warns the EU crisis response was insufficient, and that the crisis would continue;
- Andrew Duff says a fiscal union is not only desirable, but it is the only way for the EU to survive the crisis;
- Peter Ehrlich comments on the conspiracy theory that German newspapers want to bring down the eurozone;
- Gordon Brown, meanwhile, predicts a huge crisis in the eurozone next year, that requires a high noon EU summit to resolve
This is the macro view and the negatives continue rolling into my inbox day after day.
Exploding unemployment rates and surging prices - official HCPI won't tell you that story - squeeze consumers already hit by austerity measures. I may not make many friends, but this is only the beginning of fiscal consolidation in a technically bankrupt Eurozone where all hope hinges on Germany despite this nations' own insurmountable problems in health and social services.
It is mainly state guaranteed pensions that burden most Eurozone countries beyond financial capacity. Additionally the greying continent drowns in a growing avalanche of health costs that will not disappear.
In Germany, thousands of protesters went out repeatedly to show their anger about Angela Merkel's nuclear power policy, a shortage in affordable housing, and infrastructure projects heavily opposed by those affected by it.
Germans also begin to find out that the Euro may have not been such a good idea after all and reject the idea that they have to bail out the rest of Europe. This is not going to work anyway as ALL Eurozone members except Juncker's Luxembourg will see their debt/GDP ratios rocket far beyond the 100% figure in the coming 3 years.
French unions continue to stage protests, fearing that Sarkozy's policies will otherwise lead to an erosion of welfare the way
Thatcher orchestrated it in the UK 25 years ago.
The list of issues protested by sovereigns who begin to feel that Europe has so far helped its banks, but nobody else, grows with every day.
People are out of their pockets already, ex-footballer Eric Cantona's bank run initiative showed.
His bank run on December 7, where savers should have taken out their bank deposits, found no followers for the simple sad reason that Europeans only have debts at the bank.
An anonymous contributor to German language hard money forum Hartgeld disclosed that 80% of his bank's customers are deep in the red by mid-month and only 10% had more than €5,000 in their checking accounts. And this is what is called wealthy Germany?
This layer of prosperity has become thinner than a hair, it appears. It may be soon gone thanks to an Endsieg strategy that leaves the people behind in favor of the banks and a Euro dream that was destined to fail from the beginning. This must not be tolerated.
Brussels has to arrive at the conclusion that not all banks are systemically relevant and let the economic downcycle work through the overcapacities in the sector. Banks are no exception to the rules of profit and loss and irresponsible support actions that saddle the sovereigns with intra-generational debt will inevitably lead to more social turmoil on the old continent.
Europe's time for a hard awakening has come.
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If I was Germany I'd say absolutely not. Wouldn't it fall on them?
Yep, basically France and Germany pay more so that everyone else can borrow for less. Doesn't take a genius to see who will disagree with this plan!
Whats funny is that Germany benefits so much from the eurozone, and having a weak currency helps its exports.
The Eurozone is doomed, which hopefully means when the US dollar dies, there will be a return to sound money, not just a new fiat world reserve currency.
http://psychonews.site90.net
PsychoNews: Exposing the Oligarchy, one Psycho at a time.
That's simply not true.
Remember the stream of ZH articles from Tyler that showed how Greeks were moving billions out of Greece, per month? That was all bank deposits - and that in one of the weakest European countries.
Bank deposits in France and Germany are even heftier. The current total of 'hard deposits' (i.e. hard cash) in the euro-zone is around a trillion euros.
"Cantona's bank run" failed because people did not follow his idiotic advice. Cantona earned his money with his football skills, not with his brains ...
Btw., he himself has been reported to have taken out EUR 750,000 in cash, which he has then (quietly) deposited in another bank :-) What a hypocrite ...
To a large extent, yes. While Luxembourg (surprise!) is a tiny country with a huge banking industry. And under the /status quo/ Ireland will supposedly be paying Germany interest for the privilege of bailing out German banks. Of course the German public doesn't like the /status quo/ either, for good as well as bad reasons. At least Juncker is offering some kind of plan other than "keep on smiling until 2013", even if it is an enormous hand ... out for the banks.
History shows us how this will end. They will all commit default in their bunkers as the bond vigilante army closes in on them.
that would be good for the Euro. Because after the collapse, the vigilantes will have a strong currency to hold while they murder the dollar.
.
At least you admit now whos in first. Viva' the Dollar, bitchez. Book it. Quadrillion in dollar denominated debt pulls in a nice monthy payment ... Lol'
Uncle Ben = Pimp'.
No, you dont get it.
The Euro will default and restructure, the US will just print.
A brilliant connection, the Endsieg. Stunning.
No one seems to have a plan B. It's getting late in the game for pointless posturing.
The Euro is the plan B for when the US dollar is toast.
People seem to forget that the Euro zone is a net CREDITOR, with 10,000 tons of gold MTM, and China's biggest trading partner, and the only currency not linked to a nation state.
Which in and of itself should tell you that it is even worse than the $ in the sense that it is a complete fabrication with no home, reason to exist or true value. It is a 100% synthetic creation of bankers that create and move money around so as to get people hooked before they pull the plug. These people aren't banksters, they are drug dealers. They peddle their fake crap, create false euphoric feelings (strong economy, baseless claims of unity etc.) and then ask us to repay them with hard work, taxes, confiscations and other methods of "real value"
The people of europe, being more demanding of their governments, I think will catch on to this and eventually chase these drug-peddling bankers into the mountains.
This isn't a jab for those here that may be from europe. I am simply stating that europe is united only as long as it suits the bankers. It is all false, just as the strength of Russia's military was the great fear for so many years until they decided to pull the plug there and perhaps America's tomorrow. It's all an illusion. The sooner these structures collapse, the better of we'll all be.
The ECB marks its gold holdings to market on the reserve asset side of their balance sheet. It is the only currency that is floating the price of gold(true value).
The Fed/dollar treats gold as a competing currency and does anything it can to discredit and devalue gold with the paper gold fighting machine.(COMEX,LBMA,GLD)
The USA has tons of gold, the most, they can backstop any trade.
The great ECB borrowed what ? 3-4 trillion from uncle ben over the last 3-4 years. Ben'dover, euro bitchez, gimmy 10% in gold on that note, double wammmmmmy.
ECB - Ben, we need dollars(4-trillion) our banks are on the wrong side of the trade( fuck'd). Can you help us, please .... ?
Ben - O.K.
ECB - When will you wire it ?
Ben - After the glee re-run is over.
ECB - Uhhhhhhh ... o.k.
Ben - Oh ya, I want ten percent down in gold.
ECB - ooooo.k.
ECB/Euro = Circle Jerk. Wait till Germany needs a rate jump because her economy is booming. Shit we must keep the rates low for the pigs, ..... tick,tick,tick .... Boom - Germany = Fuck'd.
Layering the Euro on top of gold is unnecessary - all it does is adds a layer of corruption, manipulation, etc.
If people really get serious about gold, they won't go for the crap-coated version (the Euro).
yep.
the euro carried the weaker nations into FAR more debt than they would have been able to get into under their own currencies. And, now the austerity of the compound interest will be far more savage. Either that or they bail the eurozone and just default.
Just taking the pain of the balance of payments deficits and consequent inflation is a much better bet than dealing with ANYTHING that the IMF or central bank pimps are trying to push
Sure the 10K tons of gold are impressive, but how much of it is physically stored in the respective home countries - talking Germany in particular. To better represent the real world you would have to add Germany's gold to the US balance sheet - de facto that is the situation.
Well the queen funds the greens in germany. They are hopeless. Their youth, even more brainwashed than the U.S.
The only way out energy wise until FUSION, is NUCLEAR. Poor brainwashed german bastards are so 'GREEN FASCIST' they don't see their ideas are neither green, nor workable.
Germany's Green Fascists are a tool of the Queen of England. Destroying Germany, one strudel brained youth after another.
Fascism isn't just on the march, it's already in control.
You claim their ideas are lame because they are 'unworkable' and yet your proposal for a solution is....unworkable.
How 'unworkable' will the wind generation they are investing in now be in say 2080?
Very unworkable for baseline loads.
Another vote for restructuring. They are starting to pile up.
Typical Anglo-American anti-EU dribble; yes, many of the points are salient and accurate, but as always the conlusions are all wrong, and of course, the same rigor is never applied by these participants when examining the US, conclusions & standards that I'm sure this guy didn't support in 2008, nor does now--who thinks we should let Citi be bust RIGHT NOW? Anglo-Americans just don't understand the EU project. Period.
Nevermore is this clearer when celebrating the imminent demise of the EU/EZ project without any consideration of the impact on the US market by the simple existence of a fiscally & currency & bond fully-independent Germany.
And if you think that in that scenario the market will prefer the "safe-haven" of the USD & USTs [ROFLMAO $2T/yr deficits in perpetuity & QE5 imminent], I'll be **VERY HAPPY** to sell you some
dumbasses
Further, flat-out, the EU banking system is *NOT* in as bad a shape as is being presented here. Everything is relative. Compare w/US. LOL. It's only Anglo-American banks and the US that are truly bankrupt, not the EU. Let's see something that says that as clearly as people are tripping all over themselves to present the EU's "deaththrows"
ps: EURUSD? STILL 1.30, ie, WORTH MORE THAN A DOLLAR
ps2: USDCHF? WORTH MORE THAN A DOLLAR
ps3: Only US/UK big banks/firms have gone bust over last 3yrs, NOT EU. Everytime an EU, or even bigger *German* bank needs help, it's always ~€10b. Everytime an American Bank needs help, it's always a minimum of $50b and usually ~$100b over the last 3 years. Perspective.
etc
US Banks & Insurance Cos, all under receivership & the UST & S&P propped solely by the FED. This is NOT the EU's situation--though, clearly, it's not all peaches & titties over there either.
jackasses
One more thing: the EU's aging population is **MUCH FARTHER** along [older] than the US's baby-boomer generation, who's liabilities are JUST NOW starting to kick in, and the baby-boomers represent a much more substantial %% of total US population & labor force than the EU equivalents did. The EU nations, broke as they are, *HAVE* born this burden successfully, while the US is in the process of going bankrupt & printing & budget deficiting itself to death, BEFORE these obligations truly kick-in!!! fyi
Of course the US is going to default or hyper inflate. Only the most dense of morons would think otherwise, just look at CNBC to see the dullards. It's only a matter of the rest of the world getting sick of us parasiting off them. Hardly a stellar position to rely on funding the empire off the kindness of strangers.
However with that said Europe is rough too. Honestly I don't see how the EU project survives unless it does go big, like central treasury and bond function. I won't presume to know enough about EU politics to think that is going to happen or not happen. Though to my American eyes it looks like a lot of member states would not like it to get bigger. If it doesn't get bigger it will fail. I don't think that the richer member states will perpetually bail out the weaker ones. Sooner or later thy will lose patience, or the voters will get restless. And if it does get bigger it will probably fail, just later down the line.
The whole developed world is in a hell of a mess and China has misallocated capital. Hell of a time to be alive!
It won't go bigger, nor will it disintegrate. What will happen is the Germans will force & get their way, and thank God for that, because the imposition of the German & French economic models onto the fiscally undiscilplined [not just smaller, Italy & Spain too] European nations was the domestic political motive of ALL previous national goverments across Europe that drove them into the Union, honestly, often IN OPPOSITION of the desires of their nation's populace. [It's was seen FROM THE BEGINNING as a way to clean National Cleptocracy, from one administration to the next by all rival political parties].
To wit: Germany and France going to force the only REAL solution: National defaults & debt restructuring WITHIN the EU/EZ/EMZ structure. Gonna surprise everyone.
imo
or they'll go big [EuroBonds & possilbe fiscal Union]. There won't be any disinegration, and if they go big the project won't fail, because that [going big] will buy them 3-5yrs, by which time....
KABOOM! in the US
If it works out, great. I don't have a dog in the fight. Though I have to ask how is Germany/France going to impose fiscal discipline when both of them has issues, just not as as as some of the other members. France has taken on a lot of off the book chicanery as far as I can tell. Not picking on France, most every nation has. Germany seems more stable, but I highly doubt Germany would be able to carry Italy much less the other EU states. As to a default/debt restructuring awesome, but what are they waiting for? Seems like one big game of kick the can.
Going big won't save the EU. Still has the problems just pushes them into the future. Also sure the EU may outlast the US, don't know. What I do know is the collapse of either will set off a chain ration that will bring down the developed world. So if the US goes, in it's death throes it will likely pull down Europe and Japan with it. Probably China to. Likewise with Europe going down first, maybe just not quite as spectacularly. In either case I would expect the survivor to ride high for a few months then get pulled into the black hole of bad debts.
I honestly cannot see a way out without global defaults and debt restructuring worldwide. Bondholders will either be wiped out or need to find a way to not only bring back hard core slavery but make the slaves more productive.
Actually, most of the points are accurate, especially the aging/pension/healthcare situation.
How can the EU's aging population be much farther along [older] than the US's baby-boomer generation? The boom in Europe peaked about 5 years later, because Europe needed some time to rebuild out of WW II rubble before family founding took of.
That statement is preposterous, the German savings rate has always been high over decades. If any country has high real savings it is Germany (real=not offset by even bigger loans).
Both the EU and US governments are going all out to prop up the big banks.
Now that wouldn't be because big money has bought off politicians
would it? No, politicians wouldn't be THAT craven, would they?
Well, perhaps yes. Perhaps its that simple. I certainly think so.
So we live in an age where apparently most everyone has a price and will
gladly sell their soul for payment.
Get over it, work around it, and in fact, take it into account when dealing
with governments.
I'm hard pressed to be critical of the EU or anywhere unless the very local
I live in can exist without selling bonds to pay for the status quo.
That is the underlying issue.
What place can survive today on a pay-as-you-go basis?
(i.e. no borrowing, no cooking the books... actually have tax receipts
covering ongoing costs).
Can anywhere beyond a certain critical mass in size claim that?
Other than bringing down the big/central banks.. I would say the next goal
is to elect politicians who don't have an umbilical cord tying them to
the likes of 'vampire squids' ... or even the more pedestrian public unions
and their fantasy retirement funds.
Basics, fundamentals, a 'one step at a time' approach. That will work.
First step is not falling for a shallow shell of a politician such as Obama.
If someone attempts to sell you a brighter future with no hard effort on
your part then take that as a sign of a charlatan.
Many folk here are angry and very much dissatisfied with government.
So how, and with what, do we replace the status quo?
Thoughts, suggestions...
Please marshall your thoughts into something coherent .
A 'gold/silver bitchez' reply is trite and worthless.
Actual contributions of substance (yes, even as a zerohedge relpy)
are needed if we are to replace the bankster class with workable solutions.
There's a goldmine of accumulated widsom and savvy here
I would think this is the type of incubator where the politicial future
gets born.
Step 1: Sever the Wall St -> K Street money cord: public-funded elections.
Step 2: Entitlements will depend on voter status.
Step 3: Tax code of rate = ln(income)/20...all cap gains and other compensation are income. Period. No more mort interest deduction, corporate loopholes, or other 'incentives'.
Unless you want to get really whacky, in which case we can discuss my ideas about breaking the government into 'facets' so that you don't have to elect a single representative who has some less than ideal average of your favored views, but could select one rep for an economic seat, one for a military seat, one for domestic social affairs, etc
I think this would help us stop evaluating our politicians along the falsely depth-free single axis to which we've become accustomed by the good kabuki, bad kabuki electoral process.
Hey, you asked. ;)
ron paul bitchez. go look at his website for the full plan.
COO COO!
All is well mother fuckers!
He has a hypnotizing but menacing stare. He is European Obama.
I hope the bank account balances are low because they are already in gold. I suspect so. They will not have forgotten.
You bet. A lot of people are buying gold here. Let's not forget, for Americans the economic nightmare was the Great Depression, but for Germans it was the Hyperinflation. So people are more sensitive to inflation and devaluation.
Also keep in mind that for germans in particular it is a kind of regular thing to have new currency. After Hyperinflation you had the Reichsmark, then after WWII you had the Deutsche Mark, then the Euro. If you are from eastern Germany then you also had the move from Ost Mark to Deutsche Mark and then Euro.
So what I'am trying to say is that to us it might be more obvious that currencies do not last forever. Nearly everyone had the currency change at least once, older people even 2-3 times. Compare that to the long history of USD or GBP.
This is a great read. EUR-USD should head toward 1.20 again eventually, but as John Taylor stated, it could run up to 1.36 before it does. If it does, that will be a magnificent shorting opportunity.
Right now, EUR-USD is in a downward wedge on the 2 hour chart and about to test the top side of it (1.328-1329 area). If it breaks the top side, we could start the run up to 1.36.
http://www.forexrate.co.uk/new_forex_charts/eurusd.php
The top side held at just over 1.328 and the EUR selling began very quickly. The bottom side of the channel is in the low 1.31s, which could be seen during Friday's trade.
To use the word "endsieg" is frankly disgusting.
The Euro will not fail because of two easy to understand arguments.
1) Germany is a super-exporter. Going back to the Dmark would put their export sector under an enormous pressure since the Dmarks value would go through the roof. It is not in the Germans interest to abandon Euro. What we see now is domestic political posturing.
2) No nation could be forced out of the Euro and the PIIGS would be foolish if the voluntarily did. Yes, they would get the devaluation they maybe looking for but interest rates, wages and inflation would skyrocket erasing all benefits more than well.
So this is in the nations self interest. It has nothing to do with some "endsieg".
The author is probably breastfed with FOX News "anti-everything-but-brownish-rightwing-american" propaganda hence his extensive knowledge about endsieg.
The Germans are weighing the benefits of a weak Euro (+manufacturing) versus the drawbacks of their vulnerabilities to the weaker EU countries problems (-bank balance sheets, -bailout liabilities, -potential higher borrowing costs).
The best solution for the PIIGS is restructuring or default. It would crush the banks, but it would keep the Euro alive, and I would argue that it would make the Euro thrive after the restructuring is complete.
Or PIIGS could go the Iceland route. Leave Euro, default, instant devaluation of their own currency. Iceland is a perfect example, proving so far that it made the right decision.
What's missing in this analysis is the irrefutable fact that Germany has benefited enormously from having a single currency in the EU. Before the Euro, Germany's exports and balance of trade was at the mercy of Greek currency fluctations, and Portugal's, and Spain's, and changes in the French franc. Now it is Germany itself that controls the value of European currency. The Euro will survive because it is in Germany's interest that it survive.
Only unless saving the Euro becomes that expensive that Germany gets crushed by the accumulated debt. When the Euro was introduced, a french newspaper opened with "Versaille without war" (meaning Germany again pays for everything).
What is happening now is that basically the debt of broke European nations is put on Germany's balance sheet. So Germans will have to pay their debt plus _their_ new debt.
Unfortunately the media do everything they can to ensure that ordernary don't get this.
Yes, but remember that the whole Greek economy is about the size as that of the state of Connecticut. It is highly unlikely that the debt of the bozo European nations will ever overwhelm the German economy.
Don't know how anyone can be so sure on the outcome of this Gordian snake pit.
Here's some more on-topic stuff to chew on:
Faros @ KWN, and
Jeremy Warner @ Daily Telegraph uk
Nein Absolut Nicht ! Europa über alles !
Toni Straka,it is only the anglophile british Empire, that is crumbling:
"We can confirm that Their Royal Highnesses' car was attacked by protesters
on the way to their engagement at the London Palladium this evening, but Their Royal Highnesses are unharmed," the spokesman said. He did not elaborate.
Dozens of officers and demonstrators were wounded as the protest in the heart of London turned violent following the government's narrow victory in a vote in parliament.
The government suffered its first resignations over policy and the plans to raise fees exposed the deep strains within the seven-month-old coalition.
The government's majority was cut by three-quarters as MPs voted by 323 to 302 to raise the cap on annual tuition fees at English universities from 2012.
The basic level of fees will now climb to £6000 ($9680), with an upper limit of £9000. The current cap is £3290.
Demonstrator Anna Campbell, a 19-year-old studying French and Russian at Sheffield University, cried after hearing the result of the vote.
"I'm so angry, but this is not the end," she said. "It's just the beginning, we are going to keep fighting."
Outside the Houses of Parliament, hardcore activists rained missiles on police protecting the building and clashed with police at other points around Parliament Square,with several officers and demonstrators wounded.
Flares, sticks, metal fences, rocks, snooker balls and paint bombs were among the missiles hurled at police in a battle that lasted hours.
http://www.smh.com.au/world/charles-and-camillas-car-attacked-as-student...
Who created all this sovereign problems in Europe? The people who created the complex derivatives or the people who were stupid enough to buy them?
An interesting documentaire about the selling of CDS and Italian towns:
http://tegenlicht.vpro.nl/afleveringen/2010-2011/aanval-op-europa/schuld...
Sorry only dutch subtitles....
Pointing our the impending defaults in Europe does not mean the authors were somehow anti-Europe (as stated by several commenters).
Europe's problems are not imaginary (anymore than the US's problems are imaginary).
Both the US and Europe are demographically challenged (as is the entire developed world)
Both the US and Europe have sovereign debts they can never repay.
Both the US and Europe have governments that have made entitlement promises they cannot pay.
Both the US and Europe have nurtured generations of underclass that do not want to work, nor know how and that will riot as soon as their bread and circuses are cut back (as they will be--see reaction in London to tuition increases, same thing happened, on smaller scale, in CA recently for same reason).
Both the US and Europe have a political class wholly owned by bankers, public unions, and parasite class (that's were the money and votes come from). Only a revolution can break the power of the "looting" coalition.
The list could go on and on. However, I think the point is clear. Neither Europe, nor the US, will survive very long (how long is the big question) with the current political structure, the current entitlement programs paying, the sovereign debt intact.
Either the US and Europe will restructure to a more sustainable (ie. low tax, small business friendly, individuals responsible for their own pensions & medical care, governments spend smaller fraction of national income and don't use debt) model or they will move toward a totalitarian system where the government controls everything so they can pretend to pay pensions, provide the same poor medical care to everyone, crush political opposition, and eliminate individual initiative.
Either governments or freedoms will be slashed in both the US and in Europe.
That is the real choice. Not between which will win in their present form, the US or Europe, but rather will one or both be able to wrest themselves out of their statist collapse and, very painfully, throw off the shackles forged by their previous governing elites and reconfigure themselves to promote individual enterprise and freedom? OR... Will they continue on their current path to a fascist (or worse) state that is the logical extrapolation of today's trajectory?