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Bring Out Your Dead - UBS Quantifies Costs Of Euro Break Up, Warns Of Collapse Of Banking System And Civil War
Any time a major bank releases a report saying a given course of action is too costly, too prohibitive, too blonde, or simply too impossible, it is nearly guaranteed that that is precisely the course of action about to be undertaken. Which is why all non-euro skeptics are advised to shield their eyes and look away from the just released report by UBS (of surging 3 Month USD Libor rate fame) titled "Euro Break Up - The Consequences." UBS conveniently sets up the straw man as follows: "Under the current structure and with the current membership, the Euro does not work. Either the current structure will have to change, or the current membership will have to change." So far so good. Yet where it gets scary is when UBS quantifies the actual opportunity cost to one or more countries leaving the Euro. Notably Germany. "Were a stronger country such as Germany to leave the Euro, the consequences would include corporate default, recapitalisation of the banking system and collapse of international trade. If Germany were to leave, we believe the cost to be around EUR6,000 to EUR8,000 for every German adult and child in the first year, and a range of EUR3,500 to EUR4,500 per person per year thereafter. That is the equivalent of 20% to 25% of GDP in the first year. " It also would mean the end of UBS, but we digress. Where it gets even more scary is when UBS, like many other banks to come, succumbs to the Mutual Assured Destruction trope made so popular by ole' Hank Paulson : "The economic cost is, in many ways, the least of the concerns investors should have about a break-up. Fragmentation of the Euro would incur political costs. Europe’s “soft power” influence internationally would cease (as the concept of “Europe” as an integrated polity becomes meaningless). It is also worth observing that almost no modern fiat currency monetary unions have broken up without some form of authoritarian or military government, or civil war." So you see: save the euro for the children, so we can avoid all out war (and UBS can continue to exist). The scariest thing, however, by far, is that for this report to have been issued, it means that Germany is now actively considering dumping the euro.
Executive summary:
Fiscal confederation, not break-up
Our base case with an overwhelming probability is that the Euro moves slowly (and painfully) towards some kind of fiscal integration. The risk case, of break-up, is considerably more costly and close to zero probability. Countries can not be expelled, but sovereign states could choose to secede. However, popular discussion of the break-up option considerably underestimates the consequences of such a move.
The economic cost (part 1)
The cost of a weak country leaving the Euro is significant. Consequences include sovereign default, corporate default, collapse of the banking system and collapse of international trade. There is little prospect of devaluation offering much assistance. We estimate that a weak Euro country leaving the Euro would incur a cost of around EUR9,500 to EUR11,500 per person in the exiting country during the first year. That cost would then probably amount to EUR3,000 to EUR4,000 per person per year over subsequent years. That equates to a range of 40% to 50% of GDP in the first year.
The economic cost (part 2)
Were a stronger country such as Germany to leave the Euro, the consequences would include corporate default, recapitalisation of the banking system and collapse of international trade. If Germany were to leave, we believe the cost to be around EUR6,000 to EUR8,000 for every German adult and child in the first year, and a range of EUR3,500 to EUR4,500 per person per year thereafter. That is the equivalent of 20% to 25% of GDP in the first year. In comparison, the cost of bailing out Greece, Ireland and Portugal entirely in the wake of the default of those countries would be a little over EUR1,000 per person, in a single hit.
The political cost
The economic cost is, in many ways, the least of the concerns investors should have about a break-up. Fragmentation of the Euro would incur political costs. Europe’s “soft power” influence internationally would cease (as the concept of “Europe” as an integrated polity becomes meaningless). It is also worth observing that almost no modern fiat currency monetary unions have broken up without some form of authoritarian or military government, or civil war.
A little more on that particularly troubling last point:
Do monetary unions break up without civil wars?
The break-up of a monetary union is a very rare event. Moreover the break-up of a monetary union with a fiat currency system (ie, paper currency) is extremely unusual. Fixed exchange rate schemes break up all the time. Monetary unions that relied on specie payments did fragment – the Latin Monetary Union of the 19th century fragmented several times – but should be thought of as more of a fixed exchange rate adjustment. Countries went on and off the gold or silver or bimetal standards, and in doing so made or broke ties with other countries’ currencies.
If we consider fiat currency monetary union fragmentation, it is fair to say that the economic circumstances that create a climate for a break-up and the economic consequences that follow from a break-up are very severe indeed. It takes enormous stress for a government to get to the point where it considers abandoning the lex monetae of a country. The disruption that would follow such a move is also going to be extreme. The costs are high – whether it is a strong or a weak country leaving – in purely monetary terms. When the unemployment consequences are factored in, it is virtually impossible to consider a break-up scenario without some serious social consequences.
With this degree of social dislocation, the historical parallels are unappealing. Past instances of monetary union break-ups have tended to produce one of two results. Either there was a more authoritarian government response to contain or repress the social disorder (a scenario that tended to require a change from democratic to authoritarian or military government), or alternatively, the social disorder worked with existing fault lines in society to divide the country, spilling over into civil war. These are not inevitable conclusions, but indicate that monetary union break-up is not something that can be treated as a casual issue of exchange rate policy.
Even with a paucity of case studies, what evidence we have does lend credence to the political cost argument. Clearly, not all parts of a fracturing monetary union necessarily collapse into chaos. The point is not that everyone suffers, but that some part of the former monetary union is highly likely to suffer.
The fracturing of the Czech and Slovak monetary union in 1993 led to an immediate sealing of the border, capital controls and limits on bank withdrawals. This was not so much secession as destruction and substitution (the Czechoslovak currency ceased to exist entirely). Although the Czech Republic that emerged from the crisis was considered to be a free country (using the Freedom House definition), with political rights improving relative to Czechoslovakia (also considered to be a free country), Slovakia saw a deterioration in the assessment of its political rights and civil liberties, and was designated “partially free” (again, using Freedom House criteria).
Similarly the break-up of the Soviet Union saw authoritarian regimes in the resulting states. Of course, this was not a change from the previous status quo, but that is not the point. The question is not how a liberal democracy develops, but whether a liberal democracy could withstand the social turmoil that surrounds a monetary union fracturing. We lack evidence to support the idea that it could.
Even the US monetary union break-up in 1932-33 was accompanied by something close to authoritarianism. Roosevelt’s inauguration was described by a contemporary journalist as being conducted in “a beleaguered capital in wartime”, with machine guns covering the Mall. State militia were called out to deal with the reactions of local populations, unhappy at what had happened to the monetary union (and specifically their access to their banks).
Older examples are less helpful, as they tend to be more akin to fixed exchange rate regimes under a gold standard or some other international monetary arrangement. Nevertheless, the Irish separation from the UK, or the convulsions of the Latin Monetary Union in Europe (particularly around the Franco-Prussian war in 1870 and its aftermath) saw monetary unions fragment with varying degrees of violence in some parts of the union.
Writing in 1997, the Harvard economist Martin Feldstein offered a view that seems to be somewhat chillingly precognitive. He said “Uniform monetary policy and inflexible exchange rates will create conflicts whenever cyclical conditions differ among the member countries... Although a sovereign country... could in principle withdraw from the EMU, the potential trade sanctions and other pressures on such a country are likely to make membership in the EMU irreversible unless there is widespread economic dislocation in Europe or, more generally, a collapse of the peaceful coexistence within Europe.” (emphasis added).
As for what happens if UBS, and the Euro Unionists lose the fight for the euro:
Our base case for the Euro is that the monetary union will hold together, with some kind of fiscal confederation (providing automatic stabilisers to economies, not transfers to governments). This is how the US monetary union was resurrected in the 1930s. It is how the UK monetary union, and indeed the German monetary union, have held together.
But what if the disaster scenario happens? How can investors invest if they believe in a break-up, however low the probability? The simple answer is that they cannot. Investing for a break-up scenario has not guaranteed winners within the Euro area. The growth consequences are awful in any break-up scenario. The risk of civil disorder questions the rule of law, and as such basic issues such as property rights. Even those countries that avoid internal strife and divisions will likely have to use administrative controls to avoid extreme positions in their markets.
The only way to hedge against a Euro break-up scenario is to own no Euro assets at all.
Alas, this will be the final outcome. Unfortunately trillions more in taxpayer capital will be lost before we get there.
In the meantime, enjoy as UBS just unwittingly announced the final countdown for the EUR.
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cheaper than dirt
This will come as a complete surprise to 90% of Americans. That is the sad part. Also the reason that the assholes were able to get us into this situation. Mass ignorance, generated by mass hypnosis, through the medium of TV. Very well orchestrated. But you have to be careful what you ask for, as it can get out of control.
If it wasn't for the internet, we would all be in the dark. I just hope that ZHers' plans will actually work when TSHTF. I guess we are about to find out. I don't know about you but I am stockpiling Guiness.
John Hussman says, "we should brace for a very serious turn of events almost immediately."
Well there's a shiny penny!...lol.
All kidding aside, Hussman is another who's opinion I respect a great deal.
BRING OUT YO DEAD BITCHEZ
but I'm not dead
Yes, I do have better Idea, get educated and stop reading this
depression site, or at least read another 15 sources and filter
everything.. Global Finance system is far away from collapse..
And GOLD not going to 5000 overnight.. Ohh and Revolution? Civil War?
That's definitely mental case.. And if you have a bills from
your doctor office in that matter,
you might as well forward them to ZH for prompt payment
or hire the lawyer who will take care of that..
Those are bold claims.
Do you
always try to write posts in
haiku form
?
That's what happens
when the crazy old lady with the manual typewriter
stops with the angry letters to her local paper
and starts posting on the innerwebz.
<ding!>
Nobody knows when a financial collapse will happen as long as there is additional leverage to prop it up and the masses still believe. I would say the global sytem is fairly highly leveraged and the populace is becoming more skeptical. We certainly are headed in the wrong direction on both counts.
What is foolish is to act as if collapses never happen. If you believe Paulson, one almost did 3 years ago. I think we might have survived it, but "the save" increased the chances of not surviving the next one.
What is staggering, and what has caused the two most recent drops in the global markets, are indications that for all of the bail-outs and hand-outs to corporations and banks there still is no real sign of a recovery. Nothing is moving. It's like the patient has been given all the medicine and all the procedures and yet there is no sign of the illness subsiding.
Likewise, it is worth recalling that all the dominos began dropping because the credit markets--the repos--began to seize up in 2008(then on account of shit CDOs), and we have a very similar scenerio right now(on account of shit sovereign bonds). Only now there is practically nothing that can be done. I would love to take this as simple hysteria, but I DO read 15 other sources and most of those sources look at the same data, and do so honestly. There has been no recovery. In fact, each year the situation gets worse, this being the worst year so far. And I don't mean the "markets". I mean the economic health of the nation and the global situation overall.
You go to 15 other sources and tell me what YOU think.
(yes, I used the same reply for two posts)
Here's an interesting news item:
http://www.blacklistednews.com/Douche_Bank_CEO_Just_Gave_A_Terrifying_Speech_In_Frankfurt/15576/0/38/38/Y/M.html
Interesting quote from that piece: "Another measure that he [Josef Ackermann, CEO of Deutsche Bank] does not think will help, he says, is dissolving the Eurozone. "The costs of supporting weak member states, particularly from the German perspective, are less than the costs of disintegration.... It is a dangerous illusion to believe that a country could do better should it reclaim the sovereignty it has delegated to the EU.""
Curiously enough, he also said that: "It is an open secret that numerous European banks would not survive having to revalue sovereign debt held on the banking book at market levels."
So on the one hand, it is a dangerous illusion if Germans want their sovereignty back from the EU, yet marking bank assets to unicorn is not a dangerous illusion from the perspective of senior bankers. I don't know who these banker people think they're fooling, but if I was a German, I'd sure want out.
I already read more than 15 other sources which I filter heavily and I'm back here because, in aggregate, it is the most complete. All of that which I read as 'predictions' several years ago (early 2008 and earlier from other sites), now coming to pass.
Moneywise:
Tell me, how will the Eurozone unfuck itself? Between governments and banks, they are many trillions of euro in the hole. Where is the money going to come from (besides printing)?
Then, look at the United States, which is truly a disaster. $17 trillion in debt by the time Obama's first term is up. And many, many tens of trillions of dollars in unfunded obligations the U.S. can never, ever afford to pay. Yet tons more baby boomers are going on the dole each day. Now, how is that going to get fixed?
I don't mind your posts, counterargument is good. But from where I'm sitting, it's either default or print. Because growth and/or demand are NOT going to pay for all the credit/debt we've blown the past 30 years.
Is a strong Germany once again being sacrificed for the prestige and power of a bristling and scorned UK, so long the pup on the lap of the Masters of the Universe? The three previous world wars*, mind you, were fought for this very reason--to destroy a potential rival to British power, especially in Europe.
(*counting the Napoleonic Wars as a world war for the purposes of illustrating British "determination" in this regard)
They're just going to have to fight club it out I guess.
What morons gave you negs? You are obviously correct.
It would be easy to say the EU has passed the event horizon is dissappearing down the worm hole, but I have a feeling this type of existential crisis is just what the globalists need to take us to the next level of world governance. As for war, we shall see, but at this point I can't imagine any of the major European countries duking it out with each other unless they can't decide how to share the oil booty from Libya. China into Tiawan, or Russia into Georgia seem like stronger possibilities for conflict as does North Korea invading the South.
You forgot Israel, and their favorite super scary boogieman, Muslims, in the soon to be released production: "Winter of Radical Islam" (Read details at: http://www.zerohedge.com/news/forget-winter-discontent-israels-eisenberg...)
I wouldn't be surprised to a European 9/11/11. Well looky there, only 6 shopping days left.
Yeah, cuz "twelvers" with a nuke, are not scary at all.
Twelvers?
Only FACT standing in the way of UBS´s "analysis" and bloody revelations should a country leave the Euro is the relative healthy and non-violent state of affairs in fx. DENMARK, SWEDEN and SWITZERLAND - 3 countries who never adopted this particular ponzi scheme. The PEOPLE here are quite happy not to be a part of this utter failure. Peacefull people not engaged in civil war and with a critical look at the way banks do business. This report is either paid by Angela Merkel or the SNB and of course UBS crapping all over itself.
But I sure like the sound of desperation in this report - they give us good reason to believe that the endgame is very near.
This is amazing!
I thought only the tinfoil hat crowd was getting hysterical. Now it is truly time to panic.
When a bank warns of civil war, instead of pooh poohing extremist views as nutty, then you know things are coming to a head soon.
It's not just for shiny heads anymore.
I was never in the tinfoil hat brigade, but reality is what it is, and right now, reality says get ready for shit raining from the sky.
But it's not just me- my fiancee is the most level-headed and stable person I know, and I run my doomer foolishness past her before I start a new project. A couple of weeks ago, I said- Honey, I'm about to buy another ten oz of silver, but I figured I'd see if there's anything else you need before I press send.
A week before school started, with three kids in the house, she said "Maybe some more firewood?" She's a keeper, for sure.
Wasn't always that way, but she is a manager in a grocery store- not a glamorous job, but certainly one in which she gets to see food inflation firsthand every single day. It's not memory or guesswork, it's math on spreadsheets, and those spreadsheets back every "doomer" here- those who do not prepare today will not eat tomorrow.
It sucks that we are in the mess we are in- I'd far rather just go to work and spend my weekends taking the kids to the park, grilling out and drinking beer. Instead, I spent this afternoon learning how to hand-drill a well in my backyard so the local authorities wouldn't notice. Gotta deal with what we've got, not what we wish we had.
Shoot them in the head or starve them to death, pick your poison, the end result will be the same. Delay the enevitable and the pain will be worse, there is no turning back anymore.
Paid posters must be on red alert tonight.
They do seem to be out in force.
Caught with their pants down. Should have played it safe and "risked off" on Friday but got too greedy, yet again. Could be real fugly tomorrow.
Carnac (and futures) say: "You are correct sir." Not so sure about "could be" says Carnac.
Right, do me a favor, buy more gold here, if you can..
Not sure what you mean by here, but I'd inform you that there's this newfangled thing called Globex.
h/t UGrev: Troll Fail.
Indeed
"The scariest thing, however, by far, is that for this report to have been issued, it means that Germany is now actively considering dumping the euro."
It's issued exclusively for ZH :))) And Germany dumping EUR?
It's like Washington dumping $USD.. Stop this lying BS crap!!!
Once Merkel is out, maybe Germany will actually man up and get the hell out of the EUR.
http://www.youtube.com/watch?v=ikJupN2aE94
http://trololololololololololo.com/
It will be ok, go back to sleep, everything will be ok
http://www.google.com/search?q=troll+doll&hl=en&biw=1249&bih=730&prmd=ivns&tbm=isch&tbo=u&source=univ&sa=X&ei=tIllTrngJoPe0QHF5ZSgCg&ved=0CDIQsAQ
Hitler Plan
The Swiss have always profited from the world's wars, so why would this prospect make them nervous? I go with the theory that UBS is trying to panic the flock, planning to pick them off a few outliers at a time. They are the wolves - guess who the sheep are?
"The Swiss"? They have nothing to say in UBS or CSFB. The Swiss will soon debate about how to get rid of the two transnational TBTF.
This move by UBS just shows that they are desperate to have a stronger dollar and weaker EUR and CHF.
If by "profit" you mean "not partecipating" in wars, well, how about less war for everybody?
Just for your information, Switzerland stopped being one of the poorest nations of Europe so around 1948.
When they run out of options,
call the TOTUS!
Germany could 100% dump the EUR, leave the EZ. If the political backlash gets so intense in Germany next 3mths, you can lock that in. If Italy and Greece are not booted out there is NO WAY Germany will underwrite a Euro-bond for that mental Italian PM and is crony government and Greece; which is a running joke.
The Euro-zone will crumble, they (EU/ECB) are totally responsible for allowing concessions to the corrupt sh*ty countries of the EZ. You think these a-holes would learn from history, their own history. Dumb ass academics.
The worst of it is that their banking regulations allowed their banks to treat Euro sovereign debt as risk-free and lever up enormously on it. That was an act of great vanity--and ambition, since it had the effect of making the eurozone look solid (peripheral bonds were being bought at low yields), keeping the EuroDream alive. I suspect that those banks were assured, off the record, that the eurocrats would not allow those bonds to default.
It was all a conjob, you are right. What is amazing is Merkel through she could fool her own voters. Either that idoit Sarkozy was able to get cosy with Merkel...the mind boggles what they were thinking with this rort on selling a Eurobond scam - it would be the junk bond of the centuray. But, UBS are an invesment bank that will take a HUGE hit if a major loss of confindence occurs. So no wonder they are ultra doomish.
Oh, so another banker with a proven track record of not being able to see jack shit two inches before his face steps forth and tells us--this time in code--what WOULD happen (subjunctive mood; see also iF THEN, by M., L., and C. Howard)? Gee, let's hop Sherman's way-back machine and go back to where that Durden nut told us to go, which was Hank Paulson.
Paulson said we'd be consumed by huge lizards unless the banks' toxic assets were purchased. It is an undisputed fact that the banks' toxic assets were NOT purchased, and as of yet no one mentions anything but swans.
When further pressed, Hank and Ben complained of tightness in the credit markets and interbank lending and PAYROLL PROBLEMS and on and on. So everyone takes a shit: oh, fuck, my ATM won't work.
Well guess what? While this shit is going on, there are 3 busy beavers over at the Federal Reserve in Minneapolis writing Working Paper No. 666 [I wouldn't dream of making that up], which explains, when published on 10/21/08, that all those reasons are complete horseshit. The Fed basically calls the Treasury a lying asshole.
I caught that sometime before the flash crash, but was definitely reunited with it here:
http://thedailybail.squarespace.com/home/wall-streets-lying-lobbyist-ber...
The paper itself is here:
http://www.minneapolisfed.org/research/WP/WP666.pdf
If you ever wondered whether all those claims we needed TARP passed were true, don't take it from me. Take it from the 3rd full paragraph past the Abstract:
"Here we examine four claims about the way the financial crisis is affecting the economy as a whole and argue that all four claims are myths."
I thought everyone knew that. You mean they're trying to recycle not only a patently ridiculous lie, but one that' was contemporaneously disproven by the serpent's own head? Huh?
What in the fuck is wrong with people in this country? Did the repeal of Glass-Steagall also outlaw paying attention?
Lack of attention allowed for the repeal of G/S along with numerous other crises enabling actions. There is likely insufficient attention to eventually prosecute the crimes. The Morlocks feeding off the Eloi.
Merkel will use her sex appeal to sell the German parliament on her plan to save the Euro...see explicit photo:
http://blogs.reuters.com/global/files/2009/08/angela-merkel-photo.jpg
Oh wot a dish *BaRf*
Like bumping uglies with the woman in room 237 in the movie "The Shining"
The five euro stock futures shown on Bloomberg are down an average of about 4%. And that's after the massacre on their Monday. Wow. The cookie is definitely crumbling.
It certainly reeks like a Hanky Panky scam job.
It makes no sense for Germany to leave the Euro. It makes sense for the deadbeats to exit.
Perhaps the best German approach is to continue the slow drip until it becomes obvious that Germany is unable to bail out everyone. Germany can bail out the ECB with its gold holdings.
Okay, I understand the whole Ghost Buster's end-of-the-world talk, but how exactly does this cause a civil war? France goes to war with Greece because of the debt? Since everyone owes money to everyone else, there will be all out war with all neighbors? NATO vs NATO?
That is just so much horseshit. If they are going to make up shit, at least consult a fiction writer to come up with a reasonable plot.
Watch those demonstations again in Greece, Italy, Spain, Portugal, France...
Those are the seeds of Civil War make no mistake.
http://theautomaticearth.blogspot.com/2011/09/september-2-2011-austerity-is-coming-to.html
See pictures above.
BTW, everyone. AutomaticEarth is a great site also.
Anyone who studied Euro history knows that Europe has been engaged in near constant war, interrupted by very brief episodes of peace. The Euro was designed to keep them fuckers (esp. the master race) from whacking each other. Now we are all modern and civilized n' shit, but the fact remains: Europe is tribal. There were some real tense moments when Iceland refused to suck off the brits and dutch that got took from Icesave accounts. There will definitely be a trade war in europe if the euro collapses, and possibly new alliances between the euro fucksticks.
Correction: Humans are tribal.
THis is the bolded part at end of the post:
"The only way to hedge against a Euro break-up scenario is to own no Euro assets at all."
I would amend this to:
"The only way to hedge against a Euro break-up scenario is to own no FINANCIAL assets at all."
Paper wealth amplitude is going away
Local gold buyer is giving away IPods if you send him enough gold! LOL... Just heard the ad on the Thought Vacuum. No thanks buddy. I'll keep my PMs and you keep the overpriced MP3 player rip-off made with slave labor.
Met an old couple over the weekend at one of DC's museums, and it seems they're quite wealthy and travel around the world every year for leisure. I asked whether or not they approve Bernanke's inflationary policies and their attitude toward Gold. To my surprise, the couple told me gold is a giant bubble and gold will soon head down to $200 per ounce. That basically confirms what many of us already know here on this board.
They were probably just libtards, I mean, sheep...
Funny how, no matter what a persons' political affiliation is, they refuse to act on PMs or even read the sources of information I provide them. I know and work with a hell of lot of people of all stripes, education levels, skills, whatever ... Ignorance is the only bipartisan common ground between the various constituencies due to brainwashing from the media ... it is sad
It's true. I kid, but, I would bet there slightly more conservative stackers than there are liberal ones. JMHO.
This sucker is going down!
How long are they gonna hold WWII over the Germans heads?
They got guilt-ed into supporting the EU, now they will get blamed for the failure.
As long as it works.
or till it repeats itself.
And while we are at it: Bloomberg and the banks wishing for democracy to end: http://www.bloomberg.com/news/2011-09-05/economies-in-peril-proving-vote...
HK mkt plunging:
http://finance.yahoo.com/q/ta?s=^HSI&t=5d&l=on&z=l&q=l&p=&a=&c=
Wow. Just wow.
How's this for a theory: Not saying I believe it, just tossing red meat to the ZH wolves for their consumption:
Greenspan always stayed a loyal Randian. He saw that the U.S. was becoming a freedomless statist entity and hated it.
So he worked himself into a position of power from which he could go Galt; withholding his actual knowledge while pushing the system toward collapse.
He did it on purpose.
I'll stick with the "Spawn of Satan" explanation. Of course, it also may be as simple as Greenie might have bopped Ayn for a while.
That's Bix Weir's theory, its plausible.
Let me assure you they would be ahead of the other poor fuckers.
I can't wait to see which perma-bulls are trotted out on CNBC this week to tell us that it looks like the lows for the year are in and that we should be "selectively" buying. That should be most entertaining.
"A little more on that...troubling last point"...
"Politicians hide themselves away
They only started the war
Why should they go out and fight?
They leave that to the poor...Yeah!"
"WAR PIGS" by BLACK SABBATH circa 1969
Generals gathered in their masses,
Just like witches at black masses.
Love it when you can rhyme a word with itself ...
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=Index&symb=spx&time=100&startdate=8%2F20%2F2001&enddate=9%2F15%2F2001&freq=1&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1&lf2=0&lf3=0&type=2&style=320&size=2&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=8&x=57&y=11
A bit too bullish I think.
Sounds about right. Martin Armstrong has been saying the same thing.
I take what Martin says to the bank.
Europe is on the doorstep of disaster. If it breaks-up, the trade barriers will rise with regulations and freedom of movement will cease as everyone will be pointing fingers at everyone else as the cause. That opens the door to WAR whether or not you want to even entertain that possibility. ...
This decision that there is EITHER a unified Europe or it disintegrates will have to be made VERY soon. The volatility is appearing off the charts starting in November and lasting back and forth going into June of 2012. I am deeply concerned that the world will turn VERY, VERY Ugly and we are not talking about long-term stuff here.
http://armstrongeconomics.com/martin_armstrong_writings/
I thougt Europe was all about peace, love and other hippy shit these days.
Are you telling me they'd start killing each other over some failed banks?
Martin A was taking of $1500 gold in august...
he cost me bad.
He never said that, He said the bottom channel was 1500.
Armstrong Economics: Gold Dodged the Bullet (Martin Armstrong,
NEURO Bitchez
The problem with bailing out weaker Euro countries is that even though it may cost $1,000 Euro per person in a single hit, those same weak countries will need to be bailed out repeatedly as we see happening with Greece and the cost per person will be astronomically high in the end. Just let the market decide the winners and losers and then pick up the pieces and move on.
How to fix the Euro. Go ask the guys who initiated the Euro, ask them what to do, then do the opposite.
all this sets the stage for global war. will we be able to match the Chinese capacity to manufacture? we built all their factories as we demolished ours.
More zombie institutions:
Postal Service Is Nearing Default as Losses Mount"The United States Postal Service has long lived on the financial edge, but it has never been as close to the precipice as it is today: the agency is so low on cash that it will not be able to make a $5.5 billion payment due this month and may have to shut down entirely this winter unless Congress takes emergency action to stabilize its finances."
http://www.nytimes.com/2011/09/05/business/in-internet-age-postal-servic...
They can close that shit down, as far as i'm concerned.
FEDEX, bitchez
They can close that shit down, as far as i'm concerned.
FEDEX, bitchez
prepare for a massive spike in black unemployment as USPS was a jobs program for them.
FNM and FRE are desperately clinging to the gov't tit or else they'd be flushed too. Are Bama and Place Holder gonna save the payola for "my people"?
http://www.realclearpolitics.com/video/2011/09/04/rep_maxine_waters_call...
worthless maxine waters says we need a trillion dollar job program....this goes without comment by me. what can i say? the woman is totally nutts....
You can't say it goes without comment and then comment!
And yes she is not just crazy she's a moron.
The movie "The Postman" being made reality
With UBS it is always about money. They have no moral fiber. Wait until you see what they do with their un-wanted US operations.
There's no way to avoid a civil war - this time over debt bondage (slavery). It just won't look the same as CWI because it will in part be fought over cyber territor. But unless a massive default happens, just sign your kids over as slaves. Default is civil war.
http://www.youtube.com/watch?v=9iwNp5v-hGY
I'd trade civil unrest and a depression to see the Kleptocrats get wiped out and lose all their wealth & power. Bring it on.
I just added to my gold short 1904
Aim
The OECD defines itself as a forum of countries committed to democracy and the market economy, providing a setting to compare policy experiences, seek answers to common problems, identify good practices, and co-ordinate domestic and international policies.[9] Its mandate covers economic, environmental, and social issues. It acts by peer pressure to improve policy and implement "soft law"—non-binding instruments that can occasionally lead to binding treaties. In this work, the OECD cooperates with businesses, trade unions and other representatives of civil society. Collaboration at the OECD regarding taxation, for example, has fostered the growth of a global web of bilateral tax treaties.
The OECD promotes policies designed:
to achieve the highest sustainable economic growth and employment and a rising standard of living in Member countries, while maintaining financial stability, and thus to contribute to the development of the world economy;
to contribute to sound economic expansion in Member as well as nonmember countries in the process of economic development; and
to contribute to the expansion of world trade on a multilateral, nondiscriminatory basis in accordance with international obligations.
http://en.wikipedia.org/wiki/Organisation_for_Economic_Co-operation_and_...
the bankers made them fight and then the bankers brought them together.......isn't that sweet? and they went for it, like the good little slaves that they are. they sold their countries and their freedoms and their nations down the river, so the bankers could control them better and destroy their nationality and their racial harmony...
and now a word about the euc and how it was created and the people that moved and worked to get it together....as you can see, they worked long and hard to get it together and letting it come apart is not in their best interest, therefore imho, it won't ever happen...........
http://watch.pair.com/synarchy-4.html#coudenhove-kalergi
if you read, you will notice many of the names that ron paul idolizes are in the mix. hmmm, so austrian economics is good and keyenesian economics is bad ............and both arguments are controlled by the same people............hmmmm, so, where does that leave a man like ron paul? so we have ron paul is good and obama is bad.........gee, really.?
Euro crash coming to a stock market near you, bitchez!! Post office about to miss payout unless they get a large infusion of cash from uncle sam, and just in time for Christmas!! Ben prints (covers treasury debt)......and PMs SKYROCKET!!!!!!! What will it take for you haters to FUCKING LEARN?
Gun's and Ammo Magazine to become the investors guide of choice for the next 20 years.....
get lots of guns and ammo while you can. you may need it one day real soon...........i am sorry to say... since the sleeping amerikans obviously refuse to do anything about what is happening, then perhaps plan b must come into view now and that one is called survival............
I'll take Investment Advice From A Man With No Shirt for $1.4 quadrillion, Alex.
Far right and leftist groups are on the rise in Europe. There will be a contitnental civil war. It will be bloody and something we never seen before. There is so much anger that blood will spill in the streets.
oh my, how many times before has this happened?
http://www.youtube.com/watch?v=EHHzd7XOwJ4
don't they look pretty out there with their uniforms on getting ready to die for nothing to enrich the pocketbooks of a bunch of rich bankers......
Ricky: [to Bob, while interviewing for applicants] You're too old, fat man.
[to Angel Face]
Ricky: And you, you are too fucking... *blonde*!
good one, t.d.!
after the robert paulson article, wtf's he gonna pull next, here?
Tyler Durden: [Robbing a liposuction clinic] The richest, creamiest fat in the world. The fat of the land....
Narrator: [about the soap] Tyler sold his soap to department stores at $20 a bar. Lord knows what they charged. It was beautiful. We were selling rich women their own fat asses back to them....
Tyler Durden: We're a generation of men raised by women. I'm wondering if another woman is really the answer we need....
Narrator: By the end of the first month, I didn't miss TV.
tyler is amping up for 9/11. trust me, BiCheZ!
Pixies - Where Is My Mind? Fight Club Soundtrack - Footage Montage - YouTube
Axel Weber opts to employ the lost art of subtelty from the UBS C suite with greater ablomb than when he was with the ECB.
http://www.businessinsider.com/josef-ackermann-euro-banks-speech-frankfurt-2011-9#ixzz1X6jaeDd8
this guy with deutsche bank says that european banks could not survive a mark to market of their bad debts.............well hell, today on cnbc, this is all the talking heads talked about damn near all morning......what the hell?
CNBC -- Moron TeeVee
Like JPM, BAC, Wells, BNY, Citi, Goldmanite et al could survive mark to market...
Flush the banksters, wipe out the share holders and give the remaining assets to the bond holders to form solvent banks...
Hey Obama Bin Lyin'... come talk to me about your job when Jamie & Lloyd are doing Madoff time...
Otherwise... you and Valerie "Bitch-O-Matic" Jarret are the next biaches to be unemployed...
Found this on Bullion Bulls Canada from Reuters:
Analysis: Pension funds in new crisis as deficit hole grows"Pension funds in developed economies are facing a new crisis as falling equities and tumbling bond yields widen their deficits, threatening the incomes and retirement dates of future retirees."
http://www.reuters.com/article/2011/09/05/us-investment-pension-idUSTRE7...
Western ‘Pension Crisis’ Reflects Investment Incompetencehttp://www.bullionbullscanada.com/index.php?option=com_content&view=arti...
i told those boys to get on the gold bus back in 2003 but they just wouldn't listen.........paper profits worked for a while but sometimes not so much.......we are the end of fiat but the boys in new york that wine and dine the pension fund managers never told them that did they? where is leo when you need him? :)
Angela Merkel has just sent Archduke Ferdinand a nasty text and attached a picture of her genitalia.
IT'S ON NOW, BITCHES!!!!!!!!!!!!!!
speaking of female politicians, palin is looking damn hot these days. if she looked like obama's beard, she would not even get any votes..........the dumb stupid amerikan male sheep like looking at the political babes that are easy on the eyes...
ty ty, lol as I type :)
The costs are high? Yes. The cost of freedom is always high.
It's also worth it.
the cost of freedom must be born within one's own country and never in a foreign land. washington made it clear we should keep our noses out of other people's business, in his farewell speech. we never learn though. as the late singer janis joplin used to sing, freedom is just another word for nothing left to lose....
Saw a report that said 40% of Europeans have some form of mental illness. That means that 40% of the people in charge of Europe are nuts.
It also explains European cinema.
And that whole Jerry Lewis thing.
Also letting the French run anything.
did they finally succeed in getting that stiff off of the stage? gads....
hey rodent, did you check out perry today saying he won't do anything about the wetback problem......i am sooooooooooooo shocked.....
Latino voters split their vote 70/30, so both sides are gonna kiss up to them.
We are in a depression-ish phase and the public doesn't seem to care much that the border is a joke.
That horse has left the barn already.
and the cities.? the cities will burn to the ground and then they will come looking elsewhere for booty and food etc..........the only reason this has not happened yet is they are waiting. besides they think that is mexico and for some silly reason they think they want it back, whatever that means. so they wait until the time when there is no law and they will make their move perhaps that time is near..........my rich jewish friends think they are cool living within the walls of the dominion.....i told them the mexican gangs will breach those walls the first night.......
Germany should do a deal with Putin.
Trade tech for energy.
Screw NATO.
Germany enjoys peace, quiet, and democracy again.
Didn't they do a deal with ruskies not long ago? Didn't go so well if I recall correctly.
http://www.youtube.com/watch?v=-TLIQChU1Q4&feature=related So it's the kiss of death A?
Let me get this straight:
Favorite Nation status for the Great Wal Mart of China and breakup of CCCP
GATT NAFTA WTO etc...
EU Euro
911 Iraq
666 S&P Zero Interst Trillion(s) POMO Sellout HFT BTFD Cup of Gold
Quakes Tsunamis Nuclear Meltdowns Hurricanes Tornadoss Pandemic Drought Fires Floods Famine Fish and Bird Die Off Oil Blowout Heat Solar Maximum Solar Flares Comets New Years Blue Moons Eclipse Over Easter Island Super Nova ...and a Black Hole Eats A Star
Middle East Arab Spring 911 10 years later Iran's Nuke Plant Goes Online On 9/12/11 State Department Issues Global Terror Warning and the EU implodes U.N. votes coming in for Palistine State with Jerusalem in play
there are no jobs on Labor Day Weekend
...and 2112
LOL http://www.nasa.gov/mission_pages/swift/bursts/devoured-star.html
Let's see, the prophecy of the time Christ is to show up, or else humanity would fall into total wipeout mode, sure looks to be now upon this generation. LOL Could be time to consider this huh? LOL http://www.youtube.com/watch?v=J95-4mmm8cE
one thing is for sure. texas is on fire right now as i type.........all over the place around here and in other places around austin etc...
Don't worry HPD...
Governor Douche Bag Globalist Perry is on top of the fire situation for the people...
Stuffin' more foot long corn dog down his gullet than Michelle "Stepford Wife-IRS" Bachmann...
he is the poster boy for the concept of term limits for the office of governor , that is for sure. good grief.......i think it would be so much better with medina in there but her career is on the rocks after what alex jones and glenn beck did to her. maybe perry, since he is running for national office now, will keep the woman hating gayness down to a minimum , at least for a while...
Blather on monetary union.
the Latin monetary Union was a take it or leave it system that went along well until war and the usual inflationary rackets.
The LMU has zero to do with the EMU and anything thereafter. 20 Drachma=20CHF=20FFr-20 Belgian Franc=20 Lirta of Italy= Tuisia, etc.
I have all but the 20 Greek thing (as a collector of s few examples of a monetary union), but they all were .1867 Troy Ounce of gold content and were all equally as good anywhere on the globe.
Sans fiat, this was the only time that your pocket money could cross borders anywhere. Laborers could have gold coin and not be subject to war devaluations and whatever the gomints cooked up for them. On Labor Day in the USA it would be a good idea to quote the labor leaders of that day on just how a gold coin standard was there to protect the wages and savings of labor.
If a midle class laborer had saved in circulating gold coin that person would be sitting far better off than had he misplaced confidence in fiat paper. That will get a reprise in the several sorts of fake gold in the ETFs and such.
I agree with longballs.German readers of ZH should spread the good word i.e. dump euro and be free.Germany,stop hanging your head in shame.
germany should also quit giving israhole money for reparations payments for the holohoax too............but i digress..
This German would fully support departure of the EMU at much higher cost than threatened in the article.
The EU is breaking up, no way around it. This scenario of civil war and such won't happen, what will happen is civil strife not war. People will be making a run on govt. to fix this problem, and they won't have an answer. Govt. will be thrown out of power and new ones put up in said countries.
Some of these newbie trolls are out-trolling me.
It is so fucking unfair.
.
www.silverrevolucion.com
T-R-O-L-L
You better worry UBS... because this time... Civil War may mean shoot the banksters... After all the Swiss public have lots and lots of guns...
Ask your self this UBS and your ECB/BIS overlords... who bats first on Bastille Day?
Kinda funny how UBS meant this to be a straw man argument (Euro break up can never happen, look how costly it would be) and ended up being one of the first mainstream sell-side houses to describe a plausible end game.
I don't rule out that they'll keep the Euro and just write off a whole lot of debt and massively cut wages in the south. It's true that devaluation isn't much of an option. Greece could quit the euro and devalue, but if the whole periphery tries to do the same, and then France, and then the US does it back, and then the Asians, it all just accomplishes nothing.
http://how-to-trade-armageddon.com/2011/09/04/playing-greek-chicken/
fuking T-R-O-L-L
kinda too bad, too, considering you actually got offa that crap 4 a while too
hit the road, jack! you don't belong here
Sir Greenspan has testified to Congress that his 'ideology' was flawed in light of the financial crisis. Specifically, he falsely assumed that executives and directors of banking institutions would act in the best interests of the firms they are charged with overseeing. He later discovered that they, in fact, don't - they, in this world of emphasis on quarterly profits, options, looting everything before the fiat hits the fan, act in their own self-interests; that the 'long term' is someone else's problem.
In that light, one wonders what The Maestro thinks about politician's dedication to doing right for their respective nations. He would answer along the lines of- 'try to legislate greed'.
He who is guarantor for a stranger will surely suffer for it,
-Proverbs 11:15But he who hates being a guarantor is secure.
Sea of Red
http://capital3x.com/?p=772
"If Germany were to leave, we believe the cost to be around EUR6,000 to EUR8,000 for every German adult and child in the first year, and a range of EUR3,500 to EUR4,500 per person per year thereafter. That is the equivalent of 20% to 25% of GDP in the first year."
As a born German and citizen let me assure you that I would be happy to pay this (assuming it's actually true) if it meant the return of my beloved Deutsche Mark.
This is what is going to happen:
ECB will come out EU bonds proposals well backed by nordic countries and obviously all of PIIGS. The EU bonds consitution will all be te brain child of smaghi (italy needs this more than anyone). Germany will oppose this. France will also oppose this cause Germany obviously wants the whole of EU market for itself. But Smaghi will anyways bring out EU bonds as direct competition to US and Yen bonds. Germany will cry like hell. Finally it will corner itself into opposing EU bonds. Then Smaghi will kick the Germans out of the EU market itself. Germany in 24 months will be found to be outside the monetary union.
That is exactly how things will unfold. Germany will be kicked out while Italy will take central place within the new EURO system backed by EU bonds (basically EU IOUs).
contrarian take.
I read nice words but all I hear is cry baby banker screaming..." Please Please don't stop the blood supply to our zombie fied bodies
Seldom post anymore, but has anyone else noticed that when bankers are now being interviewed on business channels their eyes are constantly shifting left? This is a sign of extraordinary fear.
mcarthur,@ 01:31
Also, it's a MAJOR telll for LYING.
Interesting note on "Occupy Wall Street."
http://www.marketwatch.com/story/occupy-wall-street-will-lay-siege-to-us...
http://www.marketoracle.co.uk/Article30264.html
Analysis posted 24 hours before the actual crash.
http://capital3x.com/?p=711