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The Extortion Racket Shifts To Italy

testosteronepit's picture




 

Wolf Richter    www.testosteronepit.com

One thing Greek politicians have taught other European leaders: fear mongering for the purpose of extortion is the way to go. It might not work, and it might be counterproductive, and it might destroy confidence in the economy and give investors goose bumps and blow up markets, and it might cause spooked consumers to hold back on purchases and worried businesses to freeze hiring plans, thus exacerbating the situation, but it’s nevertheless the way to go.

Greek politicians learned it from Treasury Secretary Hank Paulson who'd walked into the Capitol in September 2008, threatening that the whole world would collapse if his demands weren’t met. Soon, they expertly issued a series of escalating threats to extort the maximum amount in bailout euros from the Troika. It didn’t work very well as the Greek economy continued to spiral out of control, and as the frustrated Troika halted bailout payments from time to time, and as tempers flared, and as the people in Greece became increasingly edgy. But it was the way to go. Then came Spain. And now Italian Prime Minister Mario Monti.

As always, timing is everything. And there was no better time than Thursday, the day before the meeting in Rome of the big four—Germany, France, Italy, and Spain—and a week before the European summit, which isn’t a run-of-the-mill summit, but the summit, the one that would have to save the Eurozone. And the world. Again.

Monti, the unelected technocrat who was supposed to be able to unite parliament, is losing support in Italy, which is mired in its fourth recession since 2001. His real estate tax is widely despised, though he’d picked up some brownie points in the foreign media as deficit fighter, and an imperceptible nod from German Chancellor Angela Merkel. And yields on Italy’s government bonds have spiked to levels where the resulting interest expense would eat Italy’s budget alive [Read.... Italy Trembling on the Brink].

If the summit next week doesn’t result in a grand plan to turn everything around, Monti said, the Eurozone would spiral into its political and economic demise. “There would be progressively greater speculative attacks on individual countries,” he said. And he mentioned Italy by name. A “large part of Europe” would suffocate under “very high interest rates” and would go into paralysis. The public would get frustrated with Europe. A vicious cycle would ensue: while the Eurozone would need greater integration to survive, the people, governments, and parliaments would “turn against that greater integration.” That process has already started, Monti said, “even in the Italian parliament, which has traditionally been pro-European and no longer is.”

Hence, no agreement by end of the summit next week, no Eurozone—though the breakup would be gradual. And he had a grand plan: more integration to where “markets are convinced” that the euro would be “indissoluble and irrevocable”; mechanisms to keep debt contagion from spreading (meaning massive and unlimited bailouts); a full-fledged banking union with unified supervision and European-wide deposit insurance; “new market-friendly policy mechanisms”; and the direct purchase of sovereign bonds that teetering member states could no longer bamboozle the markets into buying. Every item on his list would be funded by taxpayers in other countries, particularly in Germany. And so he also mentioned fiscal responsibility, to satisfy Germany.

That would be the “absolutely necessary” minimum to save the Eurozone. And it would have to be agreed to by next week—though he’d assured the rest of the anxious world less than a week ago that Italy wouldn’t even need a bailout.

But the fear-mongering didn’t sway the German Chancellor during the Rome meeting on Friday. In fact, she left early to fly to Poland to watch Germany’s soccer team demolish the Greeks—and the anti-Merkel triumvirate of Monti, Spanish Prime Minister Mariano Rajoy, and French President Francois Hollande could stew amongst themselves.

There was, however, a nugget of success that the triumvirate threw to the media: €130 billion would be dedicated to growth measures. A step away from Merkel’s austerity. Alas, it wouldn’t be new public money or additional public money, but the activation of private capital and a shuffling of funds within the existing EU budget. It was nothing.

And Merkel brushed off any hopes that the EFSF and ESM bailout funds could hand taxpayer money directly to the banks. Nein, Merkel said, the contracts clearly spell out that states are the partners, not banks. “It’s not that I don’t feel like it,” she said, “but the contracts aren’t made that way.”

Hollande again called for Eurobonds, like a child that doesn’t want to see reality; Germany’s refusal is nearly absolute, and it’s not just Merkel, but the population as a whole. Even the banking union that Merkel emphasized she’d be open to could not include any form of common liability; it could only have a common regulator, she said. And so, Monti’s threat has once again proven to be the way to go, though it didn’t work and might become counterproductive.

George Dorgan, a macro-based fixed-income and currency portfolio manager based in Switzerland, writes that Germany won't, and can't, agree to most of the Eurozone bailout measures bandied about. Period. Regardless of what the FT and the Economist wish to believe. And hedge funds betting that Germany will pay in the end are wrong too. Excellent and pungent. A wakeup call. Read.... Eurobonds, Fiscal or Banking Union—They're All Pure Utopia.

And on the lighter side, here is the hilarious video from down-under comedians Clarke & Dawe that in 2.5 minutes summarizes with superb accuracy the entire Eurozone debt crisis.

 

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Sat, 06/23/2012 - 21:33 | 2554945 straightershooter
straightershooter's picture

CAVEAT to all readers:

Disclaimer: Not an expert in any way or shape, read at your own risk.

 

OK, Now that the trivial administration job is done, here is what I was led to believe:

 

!. Either Germany gets out of the EU quickly, or

2. All other parts of EU subjugated to the will of Germany and relinquished whatever the sovereignty they might have, ie., What Hitler could not achieve, the Euro succeeded!

CONCLUSION: Germany will be forced to take the medicine and leave!

Sat, 06/23/2012 - 21:30 | 2554940 straightershooter
straightershooter's picture

CAVEAT to all readers:

Disclaimer: Not an expert in any way or shape, read at your own risk.

 

OK, Now that the trivial administration job is done, here is what I was led to believe:

 

!. Either Germany gets out of the EU quickly, or

2. All other parts of EU subjugated to the will of Germany and relinquished whatever the sovereignty they might have, ie., What Hitler could not achieve, the Euro succeeded!

CONCLUSION: Germany will be forced to take the medicine and leave!

Sat, 06/23/2012 - 11:52 | 2553723 bankruptcylawyer
bankruptcylawyer's picture

 Every item on his list would be funded by taxpayers in other countries,

 

NO---it would be funded first and foremost by the purchasing power of savings, and the earning power of people who will be fired---- of all people in those other countries. 

the tax payers are the lucky ones who have jobs or income from what to pay taxes. 


Sat, 06/23/2012 - 11:25 | 2553647 newworldorder
newworldorder's picture

Most on this thread are mixing the poitical wants and the financial needs. One may argue they are the same thing, yet they are not.

The politial issue concerns governance across the golobe and the satiation of the massses in giving the appearance of fairness, and freedom.The financial issue concerns the continued exploitation of resources in such a way as to keep the masses working and paying taxes.

Both the financialists and the globalists want the same thing which is CONTROL. Both are in a symbiotic relationship and one cannot exist without the other.

Sat, 06/23/2012 - 09:38 | 2553443 GreatUncle
GreatUncle's picture

Mrs Merkel emphasis is this.

"emphasized she’d be open to could not include any form of common liability; it could only have a common regulator, she said."

Not surprised on the first part. When you have common liability here we go "stuff you lot lets just party somebody else picks up the tab". Hangover you ain't seen nothing yet try alcohol poisoning where alcohol is the debt. THE NATURE OF HUMANS.

The common liability would only work if those partying ain't got access to the purse strings and this is all the sovereigns borrowing. This bit is the non-negotiable part of any solution to the euro-crisis hence there is no solution possible only fudges and fixes for as long as they can. 

Sat, 06/23/2012 - 08:05 | 2553371 Vince Clortho
Vince Clortho's picture

"... €130 billion would be dedicated to growth ... it wouldn’t be new public money, ... but the activation of private capital and a shuffling of funds within the existing EU budget. It ..."

My arse.

Sat, 06/23/2012 - 05:54 | 2553283 falak pema
falak pema's picture

This article is divorced from reality in its argumentation. It forgets the crux of the matter. It is about the global bank debt and its aWESOME ignitable powder trail that runs accross the whole of the west. So who gives a shit what surrogate Monti says or what Hollande says; the real tug of war is between Merkel and Pax Americana banksta lobby; aka Hank Paulson et al. since their 2008 heist on world wide socialised assets, turned into debt overnight.

This is the ONLY real story in town. If Merkel pours more oil on that fire it means global financial meltdown. And nobody knows where that leads to.

So WOlf : what will this German partial brinkmanship, one foot in one foot out, attitude mean in hard terms to the stability of the whole financial global banking ponzi system?

I think there is agreement in this forum of ZH that by adding debt to debt we do not get solution/resolution, we just wet the bed more and the stink from the leaking and stained sheets gets harder to bear. If finding a solution is the issue, the Merkel play is making the logic of PAx Americana print and consume more unsustainable. Her austerity, whereby the peripherals get burnt under HF larceny and financial speculation, destroys the political union  of Eurozone and fragilises the Banksta strategy of Pax Americana construct worldwide.

She is now the most dangerous person from the Oligarchy perspective, as the UK tabloids now portray her. Shitty City is always glad to oblige its paymasters.

Quo Vadis first world ponzi? You don't answer that. Merkel, if she goes further down this road will accelerate the meltdown. Will she be allowed to? Your guess is as muted as mine! 

THAT IS THE BOTTOM LINE. And I want the taste of wine of fine analysis that sees around the corner! 

pS : hint, hint : Any truth in this rumor??? Sounds totally un-Merkelish! 

JEFF SAUT: I've Heard That EU Leaders Are Looking Into A €2,000,000,000,000 Bailout Bazooka - Business Insider

Sat, 06/23/2012 - 06:34 | 2553305 The Age of Usef...
The Age of Useful Idiots's picture

Considering the way Germany’s banks were stealthily bailed out (see link at the end), the insistence on the recipe of austerity afterwards which makes no economic sense whatsoever, and the fact that austerity was also propagated from all the usual megaphones of that same international Banksta plutocracy until a few weeks ago, I think there are two ways to look at this, if we are after the ‘big game’.

1)      Germany’s financial interests are part and parcel with the Banksta strategy of Pax Americana construct worldwide, operating the exact same way (see Bloomberg article on how they saved Germany’s banks at the expense of European taxpayers). However, now they don’t want to sacrifice their relative independence and have suddenly turned all nationalistic, explaining Merkel suddenly seen as dangerous. In this scenario, the insistence on austerity was just an honest mistake, due to ideological dogmas etc.

2)      Germany’s financial interests are part and parcel with the Banksta strategy of Pax Americana construct worldwide, operating the exact same way, but have an electorate to convince, including the rest of Europe on the necessity of political and fiscal union leading to the kind of undemocratic supranational structure Banksters love, giving them easier control. Under this scenario, austerity helped make things critical enough to have other nations in Europe actually begging for such a solution now, much the same way as all the usual mouthpieces in the UK and the US, and the IMF. This also would neatly explain Monti’s and Draghi’s roles in all this (there is no other solution now!), as well as Merkel's (austerity will make everything right!). In short, it was a manufactured crisis, starting with the weakest links, and a deliberate worsening of the crisis afterwards in order to accelerate the supranational entity which will kill sovereignty in Europe. Notice how Merkel is all for political and fiscal unity, supposedly though just 'not yet'.

I guess we will find out in the end. If the EZ disintegrates because of Germany, then the first scenario will be proven right. If not, then it was all a fantastic, brilliant plot to screw the people of Europe.

However, knowing a few things about Deutsche bank and the financial leadership in Germany, and the way they screwed European taxpayers and whole populations, I don’t buy for a moment the notion that there is any difference between them and the worldwide Banksta cartel. These guys are cells of the same virus. Which is one of the reasons why this guy’s articles are so infuriating. You won’t find any wisdom here.

P.S. Here is the link to the Bloomberg article explaining the German banks’ game:

http://www.bloomberg.com/news/2012-05-23/merkel-should-know-her-country-has-been-bailed-out-too.html

Sat, 06/23/2012 - 13:14 | 2553883 John Wilmot
John Wilmot's picture

Bingo, we have a winner,

Germany’s financial interests are part and parcel with the Banksta strategy of Pax Americana construct worldwide, operating the exact same way, but have an electorate to convince, including the rest of Europe on the necessity of political and fiscal union leading to the kind of undemocratic supranational structure Banksters love, giving them easier control. Under this scenario, austerity helped make things critical enough to have other nations in Europe actually begging for such a solution now, much the same way as all the usual mouthpieces in the UK and the US, and the IMF. This also would neatly explain Monti’s and Draghi’s roles in all this (there is no other solution now!), as well as Merkel's (austerity will make everything right!). In short, it was a manufactured crisis, starting with the weakest links, and a deliberate worsening of the crisis afterwards in order to accelerate the supranational entity which will kill sovereignty in Europe. Notice how Merkel is all for political and fiscal unity, supposedly though just 'not yet'.

The rivalries between member nations are farcical. The German leaders pretend to be hardnosed about the [insert broke Latin nation] because that sells to German voters. And the broke Latin nations' leaders do the inverse for the exact same reason. The bottom line is that the leaders of all the EU nations play for the same team, which is pro-EU. All their nonsensical bullshitting is about nothing more than moulding public opinion.

The EU will not break up, the problems threatening to destroy the EU will be "solved" by inflation and debt mutualization, and a United States of Europe will emerge.

Bank on it.

Sat, 06/23/2012 - 06:50 | 2553325 Ghordius
Ghordius's picture

+1, yes and no

if I'm not completely off track the German banking landscape is very diverse. You have there the State Banks, which have to follow the conservative statist directives of their owners, the private banks that are in between the forces and outliers like Deutsche Bank that is of course a MegaBank, therefore a friend-enemy of the Banking Cartel, which is of course Globalist Financialist Imperialist (incredibly corrupt/ing) and has an agenda in that direction.

and many of those interests have to sleep in the same bed because they have the same debtor.

The break up of the eurozone - regardless - is currently requested by the Financialists of the square mile. I think this is telling enogh. Oh, and of course it panders the moods of the conservatives Imperialists of the island, they love Anti-Europeanism.

The (Ultra-) Globalists hate the EU and the EZ. They are in the camp of total dollarization, total breakup of any trade barrier (existing or potential), breakup of any Trading Zone and of course any Currency Zone. Their weapons of choice are appeals to local conservativism, the way their MegaChampion Murdoch does with his media empire, and their best friend are of course the MegaCorporations.

The Financialists of the UKUS are a subset of the Globalists, since their agenda is not perfectly aligned with the non-financial MegaCorps. Often, they just have to talk the book they stepped into.

All I'm trying to say with a lot of difficulties, strange labels and so on is that the forces at play are more diverse than that, and this even more so in the case of Germany. and this drives commentators crazy, if used to simpler times and answers

Sat, 06/23/2012 - 08:45 | 2553398 The Age of Usef...
The Age of Useful Idiots's picture

You got me confused here. The square mile is all for more integration, Eurobonds, ECB printing, the whole package. Exactly like their parents in Wall Street. So is the City's puppet, the Prime Minister. Where do you base your assertion that they request the breakup of the EZ?

Sat, 06/23/2012 - 09:12 | 2553422 Ghordius
Ghordius's picture

A convergence of interest - badly coordinated:
small currencies make King Dollar and his receding dollarzone stronger
No ECB, FED & BoE are also more powerful
EuroBonds = financial opportunities, new fin. products, More FX, more churn
ECB printing full blast = ensurance that FED & BoE are "covered"

And a big dosis of "don't rock the boat" - do something that our citizens would understand better....

Sat, 06/23/2012 - 09:20 | 2553430 The Age of Usef...
The Age of Useful Idiots's picture

Please try again. Which financial firm in the City has asked for the breakup of the EZ? They are asking for Eurobonds, which is the exact opposite.

 

Sat, 06/23/2012 - 21:05 | 2554901 Ghordius
Ghordius's picture

answer here 2554721 They can ask for both and get one after the other

Sat, 06/23/2012 - 08:07 | 2553365 i-dog
i-dog's picture

 

"The (Ultra-) Globalists hate the EU and the EZ."

ROFLMAO!!!! This has to be your greatest level of disinformation ever seen here, Ghordie!! Wow!

The "(ultra-) Globalists" not only created the EU and the EZ, but they are currently furiously attempting to hold it together until after the Fall of America.

Bilderberg is their primary vehicle for getting the industrialists together with the finance ministers, while the Trilateral Commission also ropes in the lesser diplomats and executives. Davos also ropes in the heads of state. You, of all people, know this and I charge you with deliberately misinforming this blog! (Either that, or you're willfully ignorant and shouldn't be posting opinions).

The EU was conceived a long time ago, but was accelerated into birth in the 1947-1957 timeframe by a small band of Frenchmen, Belgians, Vatican lackeys, and the Rothschilds.

From Wikipedia:
"In 1954 [Baron Robert de] Rothschild was appointed chef de cabinet of Paul-Henri Spaak at the Belgian foreign ministry. For the next two years he worked together with Spaak and Jean Charles Snoy et d'Oppuers on the Treaty of Rome before the final signing of the treaty in 1957. Shortly before the treaty was signed, Rothschild was standing beside Spaak gazing over the Forum Romanum in Rome, when Spaak said "I think that we have re-established the Roman Empire without a single shot being fired" "

At the same time as the Treaty of Rome was being formulated, the Vatican's "Mr. Fixit", Józef Retinger, was setting up the Bilderberg Group (and served as its first secretary-general from 1954 until his death) with Prince Bernhard of the Netherlands, Snoy d'Oppuers of Belgium, George Ball, Henry Heinz and David Rockefeller of the US, Denis Healey of Great Britain, Alberto Pirelli of Italy, Otto Wolff von Amerongen of West Germany and 50 other industrialists, politicians, lawyers and senior diplomats from Europe and the US. Thus began their annual planning meetings to expand the EU from its initial 6 members to the 27 we see today ... all the while ensuring that, behind the scenes, US policy was always in alignment with European desires.

Sun, 06/24/2012 - 07:29 | 2555342 GeneMarchbanks
GeneMarchbanks's picture

'the Vatican's "Mr. Fixit", Józef Retinger, was setting up the Bilderberg Group'

the CIA's Joseph Retinger. Fixed it. Were you were thinking Joseph Ratzinger? That guy was almost as scary as the previous John Paul II, I mean with his jumbo shrimp like posture and continual falling asleep at public venues. Nightmarish.

All we needed was an Alex Jones link.

Sun, 06/24/2012 - 08:10 | 2555362 i-dog
i-dog's picture

Oh...Crawl back to molesting choirboys, you pathetic little worm! You add nothing to this board beyond trite comments, snide remarks, straw men, and ineffective defenses of the Papal Empire.

CIA? LOL! 

http://en.wikipedia.org/wiki/J%C3%B3zef_Retinger

"Józef Hieronim Retinger (Joseph Retinger, 17 April 1888 – 12 June 1960) was a Polish political adviser and a founder of the European Movement that would lead to the founding of the European Union, in addition to that, he created the Bilderberg Group."

Sun, 06/24/2012 - 08:33 | 2555377 GeneMarchbanks
GeneMarchbanks's picture

Your accusation is as good as mine.

Accused by whispered rumors of being a Vatican agent, a Jesuit spy, a high-ranking Mason, a Knight of Malta, a Jew, a homosexual, a CIA agent, a Zionist agent, an MI5 agent, an MI6 agent, a Russian agent and The Devil's Cousin -- and he'd say "that's not the half of it"

http://home.teleport.com/~flyheart/retinger.htm

Several books have suggested what I wrote over what you wrote but let that not stand since Wiki is gospel and books are anathema to libertarians.

Again, I can easily suggest that as a Lutheran you're an anti-Semite by default but that would just mean I'm seeing things through your prism. As gullible as it is dogmatic.

I'm neither Catholic nor Protestant but your accusations tell the story of how you think. Tragic. Comic.

Sat, 06/23/2012 - 08:53 | 2553404 GeezerGeek
GeezerGeek's picture

Warning: this comment adds nothing useful to the great thoughts posted herein by others. My only excuse is that my morning caffeine fix hasn't kicked in yet.

When I read the last part of the Widipedia quote 'when Spaak said "I think that we have re-established the Roman Empire without a single shot being fired"' I read this:

...when Spock said "I think that we have re-established the Romulan Empire without a single shot being fired".

Amazing what a few altered letters can do.

Sun, 06/24/2012 - 06:30 | 2555332 Ghordius
Ghordius's picture

+1 at the end, an empire is just a gang of nations. which implies some tolerance, btw...

Sat, 06/23/2012 - 08:47 | 2553397 falak pema
falak pema's picture

...Thus began their annual planning meetings to expand the EU from its initial 6 members to the 27 we see today ... all the while ensuring that, behind the scenes, US policy was always in alignment with European desires...

One fact seems to escape this article : In 1954 when this occured, europe was a ruined divided continent and US, thermonuclear top dog was globally triumphant. Who is his right mind is going to buy this slanted tripe : ...US policy was always in alignment with European desires... Does the tail wag the dog??? (I know I'm asking i-dog, so he should know!)

Eisenhower, President of USA, the man who ran the war; Dulles brothers in full sway on all continents, and USD and economy uber-alles as they exported like never before, Seven Sisters running Oil/Car economy and petrochemicals world boom town... and puny Europe of Mr Rottenchilds purported spawn, tells this HUGE empire...you must align with our desires!!!

Hey, i-dog, Messalina was Caesar's kept woman, not the other way round, even if she was insatiable! Find yourself a better New World Order scenario. This original European SIN to America's corruption is like the book of Genesis and "all about Eve!". Personally, I much prefer the Renaissance version of woman, and the birth of Venus! 

Sat, 06/23/2012 - 09:01 | 2553413 The Age of Usef...
The Age of Useful Idiots's picture

I think you have to take a good look at who created the FED and who the FED's shareholders are. You are still thinking along sovereign lines here, a big mistake. This cartel is international, so there is no dog and no tail.

Sat, 06/23/2012 - 13:22 | 2553917 John Wilmot
John Wilmot's picture

Yes,

You are still thinking along sovereign lines here, a big mistake. This cartel is international...

Sat, 06/23/2012 - 10:12 | 2553500 falak pema
falak pema's picture

the FED is a PRIVAtE  CB from INCEPtioN. Exceptional situation and delegation of regal responsibility, historically under king's seal, to private bankers by Wilson. Not so in Europe. So you are extrapolating when you say that. The cartel did exist but had delegated to it bigger powers by USA, where private sector dominatd government,  than in GB or France. Also, in 1954, we were under BW reserve currency monopoly. THe cartel was now under Central Rooseveltian type admin. surveillance. Pax Americana is a much bigger construct than a bankers cartel. It was in total MIC construct in Cold War days. That and Seven Sisters were more vital than bankers, IMO, in those times, as BW had given them, the admin., the keys to Fort Knox hegemony. They didn't need Rottenchilds and his likes anymore. They did, once again, when Nixon revoked BW in 1971. Now they needed the cartel badly to run the floating rate fiat money racket, and thats how the US banks became lords of CIty and offshore banking via petrodollar recycling! Enter Henry K!.....and we know the rest.

Sorry to belabour this theme but the banking cartel power/conspiracy meme and its interplay with PAx Americana is a major aspect to the complexity of current geopolitics. 

Sat, 06/23/2012 - 13:37 | 2553941 John Wilmot
John Wilmot's picture

Huh?

the FED is a PRIVAtE  CB from INCEPtioN. Exceptional situation and delegation of regal responsibility, historically under king's seal, to private bankers by Wilson. Not so in Europe.

Exactly so in Europe.

Whether the bank is formally owned by private shareholders is not important. What is important is that the central bank works on behalf of the big private banks as a cartel operator, which ALL central banks do: it is their raison d'etre. There's no important difference between the Fed and any European central bank.

Hell, they openly modeled the Fed on European CBs. The American bankers that created the fake pro-CB agititation in the early 20th century sent mission after mission to Europe to learn about how they ran their central banks. The PR line was "look how much more civilized those Europeans are, with their central banks, while we leave banking up to the chaos of the market...blah blah blah..."

On the PR campaign and agitation leading up to Federal Reserve Act:

http://library.mises.org/books/Murray%20N%20Rothbard/The%20Origins%20of%...

How (all) CBs have the same basic function as cartel operators:

http://www.youtube.com/watch?v=6HAEPSt_12U

Sat, 06/23/2012 - 17:58 | 2554629 falak pema
falak pema's picture

they didn't; the ECB does not have the powers of the FED and Trichet was complaining about it all the time. There was no fiscal cohesion between the nations, whereas the FED had cohesion in federal structure of USA for its different branches. BIG DIFfERENCE. Also remember the different FED branches have more autonomy whereas ECB is totally centralised for monetary in all of Eurozone countries.

That makes two big differeneces with the way the Ecb works relaitive to the FED. No fiscal cohesion and no monetary finetuning. 

Sun, 06/24/2012 - 06:57 | 2555336 falak pema
falak pema's picture

and, within the ECB structure itself, the Bundesbank predominates. It is Bundesbank architecture that modelled the ECB from inception. So insitututions like Banque de France/Banque d'Italie, run by central governments,  do not reflect the decision making process of ECB. It is wrong to put all the central bank in the same bag. They do not have the same culture and historical traditions. 

Sat, 06/23/2012 - 21:09 | 2554877 Ghordius
Ghordius's picture

<del>

Sat, 06/23/2012 - 11:35 | 2553685 The Age of Usef...
The Age of Useful Idiots's picture

"Pax Americana is a much bigger construct than a bankers cartel."

No. Who is financing? Who is the creditor? Until you understand what those questions and their answers mean, all those interesting mental constructs about "Central Rooseveltian type admin. surveillance" (really? evidence?) and "BW had given them, the admin., the keys to Fort Knox hegemony" (really? evidence?) are just irrelevant hypotheses at best.

I guess in British Imperial times, people also believed in the omnipotence of Her Majesty's Empire.

Sun, 06/24/2012 - 12:36 | 2555331 Ghordius
Ghordius's picture

to go back about "Pax Americana is a much bigger construct than a bankers cartel", if you peel the Imperial Onion from the outside, you'll find:

- local economies and markets at the frontier of the empire - that corresponds to the outer dollarzone, with extraction of commodities and strong MegaCorps presence and influence, the Oil MegaCorps and the AgriCulture MegaCorps, defended by the fleet, and, alas, sometimes invaded... the ultimate frontier is now Afghanistan, and the whole frontier zone is mostly ex-colonies of the european empires of old. Here you find the BRICS somehow closing a possible trade zone and thinking about a possible de-dollarization.

- the usual diplomatic "wall" that has been beefed up with facilities like the UN, WTO, IMF, WorldBank - the Globalist's everyday's tools.

- local economies and markets in the allied zone, where, depending from the local setup, MegaCorps have less influence, as shown by the difficulties of the Murdoch Media MegaCorps to get a foothold in some countries like Italy, or the WalMart MegaCorp to get a proper foothold in europe. Taiwan is also an interesting example, toghether with Japan. Here you find the EU - a prepackaged "ready-to-use" tradezone and the EZ, a possible de-dollarized monetary zone. Just in case, you know? ;-)

- the Security Shield, a wall of sleaze, too, as shown by private prisons that ask judges for more prisoners and more Wars on Drugs, immigrants, molesters - except when already employed by the TSA, and of course a high number of mercenary forces. And, last but not least, the Pentagon, the biggest "household and spender" of the globe.

- a few more informal or looser interest groups, for example the Tax Avoidance Industry (solid lobbying), the Legal Profession, a few trade unions, the think-tanks, etc. And the political parties.

- the MegaCorps themselves, who are now thinking to beef their security up. To note the big Nuclear companies that refuse to modernize their outdated models, the AgriBusiness that pushes quantity before quality, the Pharma that plays cat and mouse with prices inside and outside the US, the Military Outfitter that try to convince the consumer that the 2nd is a Commandement (good sellers of fear - fear sells guns better than sex), the Weapon Systems dealers that transformed NATO's arms bazaar to a very lopsided business, to the point that the europeans' shrinking arms industries would also cause less internal interest in military spending, and some more. Out of control, IMHO.

- the US Social Spending layer (insert here rant), also a "household and spender" of the first magnitude

- the banking and financial system - the smaller parts like small banks, small brokers, pension funds, etc. and the facilities like the Federal Reserve System.

- the Financials MegaBanks, who's most visible CEO's just visited publicly a couple of fawning senators. Thanks to deregulations and the new derivatives, they are morphing into a monstrosity, led by a dozen of relatively small clubs of old boyz that lead the further (Globalist) MegaCorps takeover. Yes, they control the credit of the empire, but they also are a relatively small part of the Pax Americana.

------

oh, I forgot: inside the Imperial Onion you also finde the Imperial Reservates (not my stupid joke - I heard it from a globalist that was not talking kindly of them and mentioning the "fly-over-zone") which are all the pockets of territories that are far, far away from the Centers of Power and the Imperial Frontier. There, you find whole populations that are completely unaware of any wrangling for imperial dominance going on since the 19th Century. Like this week's border (airborne) skirmish between the empire and a Russian protectorate, as in The Great Game of old. Made even more complex by the help Russia gives to the logistics of Afghanistan, now that Pakistan is not our BFF, lately. Truly a Tournament of Shadows.

Sat, 06/23/2012 - 12:53 | 2553825 falak pema
falak pema's picture

just one word : wow...you need evidence that the gold of the world was in Fort Knox upto 1971..?

you need evidence that the US admin. RAN the world and provided Marshall Plan, including US Aid funding to all of SE Asia...Korean War, Berlin Air lifts, Nato funding...the whole shooting match in Iran, 1953... Greece and Balkans support of Churchill. And that the FED and Dept. of Treasury ran the reserve currency bulwarking £/FF/Lira/DM....in those crucial years.

denial can become obsession.

Sat, 06/23/2012 - 13:20 | 2553896 The Age of Usef...
The Age of Useful Idiots's picture

I asked you who was funding all that, who the creditor was, who controls the currency. That's who is ultimately running things, not the Presidential puppet or any imaginary ""Central Rooseveltian type admin. surveillance". I guess even though it is classic political science to look at elites and their interests (and in the world of a private central bank in international hands controlling the currency of a superpower even more so), and even though this is also what history teaches us is the most important aspect (not charismatic personalities as high school-level history presents it), people (even with your education) hesitate because it sounds "conspiratorial". Well, we don't live in a world of angels. Human nature being what it is, conspiracies are as human and commonplace as entrepreneurship or spiritual journeys. It is the rational thing to do to preserve power.

Without credit, our world as it is cannot exist. He who controls credit has the ultimate power. The rest is political theater for people in denial who choose between bad cops and good cops full of hope and change.

Sat, 06/23/2012 - 13:57 | 2554013 falak pema
falak pema's picture

the US economy was generating huge trade and capital surpluses. Upto 1965. It controlled the world money line, had all the gold reserves and generated the most wealth allowing it to make all the political decisions. What was missing?

Sat, 06/23/2012 - 14:31 | 2554126 The Age of Usef...
The Age of Useful Idiots's picture

What is missing from this wonderful story we are all aware of, is the role of the FED, which is issuing and controlling the currency. You are pretending that the central bank of a superpower and the mega-banks it supports (who are also some of its shareholders) had no role in any of this, even though it is them who provide the financing and credit. Surpluses don’t finance global superpowers and their global operations, multiple wars and huge M.I.Cs.  Credit does. Btw, here is some food for thought: How come all those ultra-powerful presidents of this ultra-powerful superpower allowed the FED to continue to be controlled by international private interests? Does that make any sense?

And for the conspiracy-minded: What happened to the only president who challenged their power to control the currency?

Sat, 06/23/2012 - 20:51 | 2554872 Ghordius
Ghordius's picture

it is undeniable that bankers "lobbyied very quietly"/sarc  for the Federal Reserve Act, in 1913. But at that time every country was stocking up their financial power with a Central Bank. The Swiss National Bank (an example of public/private CB) was founded in 1907. The Japanese had theirs in 1882!

Everybody wanted to have a fleet, an army and a currency to spend as necessary for their empires. A Central Bank appealed to the Industrialists, to the Imperialists and to the bankers of the time. Which had already their way and gobbled up Cuba, Panama & the Philippines, among other things. Big Stick Diplomacy and gunboat diplomacy, Japan was forced by US warships to open it's trade barriers in 1853, btw. It was a time where finance had an important but minor role, the big fellas were mostly Industrialists.

1913 several shady deals in American politics happened, yes. Wilson got elected. the 17th Amendment passed. the Federal Reserve Act passed. but nobody expected a Great War that would cost the old gold standard, and catapult the USA first among the first rank Powers, and than later through the second one to became a SuperPower and then the HyperPower.

what I want to say is that the Big Moment for the FED was when the US brought forth the Bretton Woods system, before, it was "just one of many CBs". no special features.

Sat, 06/23/2012 - 15:39 | 2554316 falak pema
falak pema's picture

I am not competent to refute yor claims on the financial front. I can only say that in a political construct the power lines within the system are clearly known to those who exercise them; less perceptible to those outside the box. I can only say that your affirmation that credit is the defining factor of power, in a capitalist system based on fractional reserve banking, is built on thin air. We all know that, the banking system as it exists is a ponzi since day one! Even in those early days.  Those money changers who control the credit line are working on thin air that their Political masters ensure in the context of their Pax Americana construct, that holds the guns and the levers of overt power, like the kings before them. What gave the bankers power was the industrial capitalistic age. But they were not the only ones. Witness the number of times the presidents of USA refused central banking. It could be argued that after the FED's creation there were checks and balances between the different Oligarchs of Capitalism. And all was not in the hands of creditors. Ford, the WASPS, and the jewish Oligarchs of US finance, were not on the same side of the power equation. 

Your thesis is that covert financial power is stronger that overt political power, something that history has NEVER established before battle of Waterloo and its consequences.  Indeed in the middle ages the king of France burnt the Templars, financiers of their world. As did the Hapsburgs with the Medicis of the Renaissance. Political power ruled and financial power was their tool.

So somehow the world changed on June 15,1815 and the Rottenchilds became the rulers of the world behind the curtain. Indeed, its a seductive theory but I don't think its proven that they had all the power during those per 1965 years before debt accumulation made USA dependent on them again and obliged the USA to bend knee to fiat rule in 1971.

Your question was where the credit comes from. It comes from the market, like food comes from the market as well. The question is was it the leading edge of competitive advantage; I don't think so. But that is my interpretation of those decisions, until fiat money became uber -alles after 1971. 

Mon, 06/25/2012 - 01:36 | 2554452 The Age of Usef...
The Age of Useful Idiots's picture

Ok, fair enough. You have to remember though that it is an undisputable fact that at some point no power in Europe could go to war without financing (credit lines) from the original creators of that very same banking cartel. I also think you underestimate the reasons for the same cartel creating the FED, and the power this gave them and still gives them. Another point since you mentioned him would be that Ford went all antisemitic on the grounds that high finance controlled the lines of credit and thus the survival of legitimate and solid businesses, which for him was an unacceptable monopoly power which almost brought him down too. Your objections are fair though, and I also think that thinking along ethnic or religious lines in all this (Jewish elite vs WASP elite etc) has been irrelevant for at least 60 years and probably misleading.

Nevertheless, this was all very interesting. Thank you very much for such a fair discussion. If you have anything to add, please do and I'll read it tomorrow or Monday. We'll surely meet again around here anyway.

 

Have a nice weekend!

 

Sat, 06/23/2012 - 09:23 | 2553431 Ghordius
Ghordius's picture

Yes, the cartel is international, but it's peple. A network among others.
Some of the networks are FrEnemies.

Stop seeing CBs as "evil". They are Dangerous Facilities, akin to nuclear industry, apt to be used for military, commercial and financial power and warfare.

Look up how the template for the FED functions: the SNB. Look up the other CBs, and then finally look up the Chinese One.

Yes, the current Imperial setup is blurry, I agree. But nationalism is rising again, thanks to the follies of our dear Globalists.

Sat, 06/23/2012 - 08:25 | 2553385 Ghordius
Ghordius's picture

i-dog, my point above, if you read it well (including "strange labels") is that it's very dangerous to try to push historical forces in a few handy containers. but yes, I believe that I am correct and that the gist is falsifiable, to a good extent.

let's start with me. I have to admit that I am, to a certain extent, a moderate Imperialist - I support NATO (fought Soviet Communism), and I still support, to a certain extent, the current "Pax Americana". It's a position that pains me, from time to time.

I am moderately Pro-European that thinks having a handy Trade and Currency Zone is a good idea, for many reasons.

I am moderately Anti-Globalist, that thinks MegaCorporations are the scourge of our common commercial "Empire" (the concept of CommonWealth was finer), that they have to be restrained and taxed hard. This is another reasons why I want my trade and currency zone, and I want them in a way to be viable in this current world. I really don't like the Great Globalists like Murdoch, who infortunately is also an Imperialist.

If you really think that a trade zone, i.e. a trade barrier and possible tariff barrier is what Globalists want, then I can't help you...

Out of the crop of the Globalist MegaCorporation, we finde the financials, led by the MegaBanks and their old-boyz network that extends to several government bodies and of course into US politics. They are the Financialists. I firmly believe that they are currently the most corrupting force on the globe, and they are strong in WS and the square mile.

If you really think that the Financialists are not loudly asking for more smaller currencies and many changes like EuroBonds, etc., than you are deaf...

you keep mixing up the groups and attribute the wrong agenda points to them - in horrid fascination to some of the older european old boyz networks. The Treaty of Rome was done thanks to Pro-European forces, aided by local Imperialists and Industrialists.

So what? Your list of boyz might look horrid to a Brit, Canadian or American, for us is just part of our boyz-network. And we Pro-Europeans have lots of reasons to think our way, including a wish for peace on this continent.

Sat, 06/23/2012 - 09:29 | 2553428 i-dog
i-dog's picture

Well, Ghordie, I too am Pro-European ... indeed, quite strongly so... if it were only for a trade zone and common currency under the terms of a treaty between the contracting governments. I do business in Europe and appreciate both the free travel across borders and the simplicity of a single currency when travelling from city to city. My problem is with the growing arcane central bureaucracy and the attempt to standardise everything else that would otherwise foster innovative competition among the many diverse participants within the zone and to the outside world.

Indeed, we Free-Marketers believe in the right of any groups to enter into mutually beneficial contracts with each other. And if any of those parties were to break the terms of the contract (for example by fraudulent misrepresentation of their financial position at the time of signing, or by willfully breaking any restriction on deficits) then they would become subject to the sanctions embodied in the contract or, failing that, to independent arbitration. We, unlike politicians, hold honesty to be a fundamental tenet of contracting.

I am more Anti-Globalist than you are ... but from the perspective of opposition to government-protected monopolies, government limitation of liability, government-sponsored-and-enforced regulations that throw up barriers to entry, and government sanctioned cartel agreements drafted and enforced by such unelected and non-contracting parties as the IMF, WHO and WTO. There is nothing mutual in the actions of big government.

As for the "Global MegaCorporations" ... well, you only have government to blame for them!! They could not exist without goverments to restrict the number, type and actions of participants in each market!

Governments licence them, restrict competition, limit liability, provide favoured no-bid contracts, dictate wages and conditions, and generate an environment of wage and tax arbitrage between countries that is not subject to the levelling effects of free market forces.

Few German or American businessmen would pay to set up a factory in China - and suffer all the complications of language, management, shipping, currency and cultural differences - if they were freely permitted to offer positions at mutually acceptable conditions in their home county or state. The Globalists know this, which is why they want a global central planning authority that will direct who can do what and where. A Central Planning Politburo on Steroids!!!!!

I won't bother addressing all your other usual straw men.

Sat, 06/23/2012 - 19:49 | 2554791 Ghordius
Ghordius's picture

bless you, i-dog, I'm very sympathetic to Libertarians, Voluntarists, Anarcho-Syndacalists (they have good parties, btw) & Hard Money Advocates and many other views. But I'm very vary of Free-Marketers. In principle, it's all ok, though I've seen a few scary applications of this, I've read of even more of them. Very often the Free-Marketer - particularly on the think-tank platforms - is just selling a Bright Idea of a couple of MegaCorps. Yes, you are right. No, it still makes me unconfortable. Sorry if I like the sound of "properly and intelligently regulated" better than "unregulated" or, worse, "deregulated".

When it comes to regulation I have a similar opinion to Gonzalo Lira, here, i.e. that small business and individuals are over-regulated and big business is under-regulated. I hate those MegaCorporationalLobbyist 22'000 pages legislative monstrosities that only MegaCorporation read & understand - making them the only entities that know the law. Remember that half-joke "we have to apply it to know it"?

Last time the governing law was not (easiliy) accessible (or understandable) for the general public in republics, it was the reason for the Plebeian Revolution in ancient Rome. The result was Twelve Tables - an amount the citizen of that time easily memorized.

You see, I agree with you, but I blame the Globalist MegaCorporations (a category to which also the Financialist MegaBanks belong) for corrupting the political process of the USA (and in a lesser degree including per sheer reflection europe) with endless legions of lobbyists and donations. Here lots of US Liberals (!) would agree with me. It does sound a bit like the "chicken and egg" debate, but I believe most times it starts with a MegaCorps having a "bright idea" and then the politician is instructed on how to legislate/regulate accordingly. And those MegaLaws are theirs. Only they have the size of them.

Regarding the damned arcane and blasted standardizing regulation I can only agree with you, and I have a funny story: in the EU we had this "bright regulative decision" of allowing only pasteurized milk to be used for cheese. A petition of small French cheesemakers reached the French President, claimed cultural heritage and a week later the Prez had it vetoed. The small artisanal cheesemakers still exist, the big industrial cheesemaker did not get that share of the market.

Sat, 06/23/2012 - 09:13 | 2553423 The Age of Usef...
The Age of Useful Idiots's picture

"If you really think that the Financialists are not loudly asking for more smaller currencies and many changes like EuroBonds, etc., than you are deaf..."

I don't understand this. Eurobonds is the exact opposite of the breakup of the EZ and smaller currencies. It is considered the last chance to keep the EZ together, and they have been asking for this for more than a year. Please explain why you think otherwise.

 

"If you really think that a trade zone, i.e. a trade barrier and possible tariff barrier is what Globalists want, then I can't help you..."

So they would prefer instead 17 different currencies and possible tarriff barriers?

 

Sun, 06/24/2012 - 10:46 | 2555583 Ghordius
Ghordius's picture

 tariffs: interestingly, this word is going down the way of the dodo, as CB's (FX-) Reserves. but I still think that it takes a lot of effort by the Globalists to keep tariffs down. there is always a legion of national problems and local market structures survival needs that could be solved or at least temporarily patched by tariffs, and legion of politicians willing to try a few out. between the WW's exactly this happened, and it's concomitant nationalism.

I think also that the biggest difference between Imperialists and Globalists is: who pays the military bill. and since Bretton Woods mostly, it has been King Dollar, followed by exports from europe, Japan, et al for two decades and exports from China for one decade. let's say it's an empire with a troubled funding structure

Sun, 06/24/2012 - 04:07 | 2554721 Ghordius
Ghordius's picture

EuroBonds/EZ-BreakUp: The perfect outcome for some would be first the introduction of EuroBonds, then the breakup of the eurozone. The Financialists would love the return of more FX anyway (our industrialists down to the Small/Medium would hate that), the Globalists would cherish the strenghtening of the reserve status of the Dollar and a further encroachment of the MegaCorporations in europe and the abandonment or shipment to China et al of big chuncks of our manufacturing industry.

This could be paired with heavy (or even full) dollarization of europe (again, or back to pre-1971).

Total breakup and de-nationalization of the EUR could then also be in the cards if they get their ways, since a functioning supranational currency could be merged with the Chinese Globalist demands of a better functioning SDR. (Funnily, by the nature of the existing EUR debt, this would ease somewhat the Triffin Dilemma, for a while -very speculative).

BTW, some of those scenarios go back to the late 70's, when the possibility of a Dollar Hyperinflation was discussed - and few expected the Volker Shock to function the way it did.

Globalist, Bilderberg-reporter, Anglo-Imperialist-Bard and Rothschild-Historian Niall Ferguson touches lightly something similar in his book The Ascent of Money, where the 13th century bankers created "mountains of debt" - akin to bad banks or sinking funds that were so useful that they kept being viable banks until the 21st century, like the Italian bank Monte dei Paschi di Siena.

Anyway, a similar procedure would be used for the ECB, which could be flanked by a partecipation of european national gold - which in one particularly balanced scenario would be that european gold that is "deposited" (ahm... does anybody think we will ever get it back? just asking) in the USA.

Trade Barrier: a small secret why the Globalist MegaCorporations are so good at tearing trade barriers and tariffs down? They are often bigger than the countries they service. A Customs Union has to have a certain size, and lots of power if it wants to erect tariffs, in our age. The Obama Presidency is failing in it's last attempt, if I understood it right.

Sat, 06/23/2012 - 07:28 | 2553323 falak pema
falak pema's picture

Be that as it may; even if Germany has been pulling the financial rug to its end since 2009, when the Merkel dictat of every man for himself and no joint and several was pronounced, the amplitude of the financial wave via the integrated banksta networks is now so HUGE; aka 30 trillion E integrated banking assets at stake, that if the powder trail ignites its goodbye ALL banks in Europe; mega austerity world wide. Cataclysmic scenario on both sides of the pond! Our people and our governments bankrupt. 

In such a scenario, all bets are off as the globalist model will get pissed on by all the member nation states. So wherever Merkel stands vis a vis Pax Americana, its demise will bring down all surrogates associated with it. We will be back to 1947 european construct, without a USSr, without an American master, but with a dangerous middle east- north african cauldron.

The first world will be in 1930 scenario bigtime! I know, it may be PAx Americana's only solution to offer the world. Europe's nation states, its people made destitute financially,  will have to pick up their broken model and try and avoid being sucked into a new war. Nobody knows how that will pan out.

But, if the demise of USSR is a reference, it brought hardship but no world war. Thank heaven for small blessings, is all that comes to mind in this dire scenario of first world reset. We will all be in post-USSr Russia or in Argentina! 

PS : here is an interesting add-on about German ECB shenanigans as early as 2005.

RICHARD KOO: The Entire Crisis In Europe Started With A Big ECB Bailout Of Germany - Business Insider

Sat, 06/23/2012 - 06:03 | 2553299 Ghordius
Ghordius's picture

 

 

+1, falak. The Pax Americana is a useful simplified model to explain all the strands of forces and motives that are being applied, since you would have to separate at least the component Security/Military-Industrial, MegaCorpsCommercial and the Financial, the last suffering from extreme internal corruption that reverses itself on politics.

Some thoughts:

1. fear mongering: did the Greeks learn this from the Squid? as part of the "package"? Anyway, this is an escalation of fear, and I see the UK newspapers leading the way. To be frank, the way the Spanish and Italian PMs are whining is sickening.

2. I note this repeating meme of "Europe is fixed"? Who is the American commentator that started this idiocy? Nothing will be "fixed" for quite a while, but the increase of attentions by so many speculative forces - some quite ignorant of Europe and perhaps a horde of bots not used to read european political news and how to put them in context - seems ebbing, after a steady increase.

3. It's fantastic how politics produces again and again the most unlikely bedfellows. Witness French Socialist Pro-European Hollande and the Globalist Financialist Imperialist Anti-European Square Mile asking both for EuroBonds, flanked by Italian Liberal Globalist Financialist Pro-European Monti asking for a (Globalist Financialist) Paulson Bazooka, otherwise the Italian Parliament could lose some Pro-Europeaness… (!) The gall to put it this way... as if Pro-Europeans would be Globalists per definition.

Sat, 06/23/2012 - 06:09 | 2553302 falak pema
falak pema's picture

harem eunuchs are always complex people, they see other people doing it, but are obliged to play as referees of passion in the hen pen for their SUltans; all the while trying to use intrigue to forward their own agendas. We are there in Eurozone. Kept, impotent politicians, bystanders to awesome financial play they don't control! 

Just my take, from an amateur of historical, cape et epée, cloak and dagger novels! 

Sat, 06/23/2012 - 04:38 | 2553265 Kataphraktos
Kataphraktos's picture

"demolish the Greeks"? 4-2 isn't exactly demolished.

Your Germanophilia is showing.

Sat, 06/23/2012 - 02:45 | 2553234 working class dog
working class dog's picture

The only thing the central planners are scared of is that if Germany or Greece leaves the Eurozone, that those two countries will be better off than when they were part of it, thereby exposing the blood sucking money trusts for what they are, what they cant buy,

or neutralize, they assasinate.

I hope Greece leaves and in a few years they find they are better off, that is the sheeple of the country not the money trusts.

Same goes for Germany, look at Argentina, they did not disappear after defaulting, Britian never joined the ponzi scheme they are still here too, and guess what Hank the Stank should be breaking rocks along with Greenspan, Bush, etc. etc. etc.

Sat, 06/23/2012 - 02:13 | 2553221 aleph0
aleph0's picture

"and it’s not just Merkel, but the population as a whole. "

 

As if politicians worry about being re-elected ... with a top paid job in Brussels awaiting them !

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