The Real Reason For A Refugee Crisis In Europe

By Chris at www.CapitalistExploits.at 

Wikipedia describes a Ponzi scheme as:

A fraudulent investment that involves the payment of purported returns to existing investors from funds contributed by new investors. It is an investment system where the investment profits are paid with the money from other investors, and those who experience profit believe the profits come from non-investors such as business activities, or the earnings and growth of a company

When the very concept of the state first came into being, the role and responsibility of government was relatively small. It was a collective force designed to keep the foreign nasties out from raping and pillaging.

It's what the Romans started their empire with. It's what the Brits began their empire with. And it is what the US first looked like after they'd kicked the red coats in the teeth and sent them scurrying home for a cup of tea and a good moan.

But humans are a predictable bunch. When we see something work, we inevitably think, "Oh, wow great we should clearly have more of that."

It's silly.

While a jelly donut tastes amazing and is harmless every once in a while, there's plenty evidence that scoffing one daily will clog your arteries, make you look like a marshmallow, and finally kill you.

And if donuts are like government, that's pretty much where Western societies today find themselves. Too many donuts. Not good!

Today we've a situation where the populace not only expect more from the government. They actually encourage them to do more.

What's that saying?

Teach a man to fish and he has to work for a living. Promise to feed him a fish and he'll vote you into power every time.

As governments promised more donuts, they had to figure out how to pay for them.

The thinking man knows that government don't make anything. They simply redistribute what exists

And since governments began promising more and more redistribution (pensions, healthcare, education, transport, etc.), they needed to bump up the revenue side of the ledger. It's one reason why Europe has such high taxes.

The issue with higher taxes, other than the obvious such as declining economic activity and a loss of global competitiveness, is that Europe's tax base is declining.

You see, Europe has a baby making problem. Take a look at median ages in European countries:

  • Germany: 48.8 years
  • France: 43.2 years
  • Italy: 47.1 years
  • Spain: 44.3 years
  • Austria: 45.8 years
  • Holland: 44.5 years

Opening Up to Eastern Europe

One thing the Europeans began doing was opening their borders to Eastern Europe, which was a way to expand European capital and labor markets.

It worked to increase the labor pool and drive down wages, especially in manufacturing, thereby helping Western Europe remain competitive with the US and the rising Asian markets.

They also got an educated workforce who held similar European customs and values. All good.

What they didn't get was young people. Eastern Europe, you see, also has a baby making problem, which for the life of me makes no sense. Have you seen the women in Prague or Budapest?

When the concept of the EU came into being, I'm pretty sure they had some of this in mind. Certainly, when including former Eastern European countries, it was as obvious as mud that folks from those countries would opt to leave their countries and move to Western European countries, and this would in turn help bolster cashflows from tax receipts.

But true to form, instead of socking away the wealth, government simply expanded, offering more. And the citizens, largely clueless as to what the balance sheet or income statements looked like, continued to vote in socialist leaning governments. It's happened across Europe.

Why the Refugees?

It's because they have to.

How else do you fill the income gap on the Ponzi scheme of entitlements?

I've written before about importing migrants from countries, which Europeans spent most of the last two generations... destroying. It is foolish, but consider that the median age in Iraq is 20. Libya is 25 and Syria 24.

These countries held the promise of solving the "age" equation needed to keep the Ponzi scheme afloat.

  • The story of Brexit,
  • The story of the breakdown of the EU, which we're in the midst of now,
  • And the story of the rising populist governments in Europe.

They're all part of a bigger story, which is quite simply a Ponzi scheme where its masters have been forced to make decisions that are proving to be uneconomic decisions.

The refugee labour force is unskilled, uneducated, often violent, and arriving for the benefits... which are rapidly drying up.

This is in fact accelerating the demise of the Ponzi — sucking out more capital rather than replacing it. And this is without mentioning the social upheaval being caused.

When you realise that the entire process of how governments finance the socialist agendas is via the bond markets, you'll realise why here at Capitalist Exploits we've repeatedly stated that Draghi can't raise rates.

That dog just won't hunt. With such enormous debt burdens higher rates would immediately bankrupt the governments.

Interest rates and the provision of liquidity by the ECB into member states banking systems is coincidentally also the stranglehold that the pointy shoes in Brussels have on the member states.

Toe the line, otherwise we'll pull liquidity from your banks, and you'll have no hope of meeting any of those obligations to your citizens... and thus no hope of election.

The Easiest Go First

The Brits, perhaps because they never joined the Euro and aren't beholden to the ECB like their fellow Europeans across the pond, were the first to put down their pint of lager, look at this fustercluck, and say, "Whoah, hang on a minute... enough of that!"

It was one thing to open their borders to pretty Polish girls who work in fintech and Italian technicians who swagger about and spend too much time on their hair while winking at your wife

But then suddenly the Brits began acting as if half of Somalia has descended onto their shores... because... well, that's kind of what happened. It's largely what Brexit is all about, though it's not politically correct to say so. Hate crime, you know.

Knife crime in London is through the roof. So bad that Somali refugees are now sending their kids back to Somalia... because it's safer there. Yes, really.

In the early 2000's this ship could have been turned around.

But rather than concentrating on those spiraling debts and unfunded liabilities, the British and really all European governments decided their time is better spent introducing laws banning people from being mean on the internet. 

This last week Trump visited the Brits and out came London's mayor Sadiq Khan, who spent the entire week whinging about the orange man. And so thanks to Trump's security detail, London was, for the first time in ages, safe... at least within a 200 metre radius of Trump.

Part of the problem, of course, is that a Londoner calling the police to let them know that the new Afghan neighbours are stockpiling ammonia and chanting "Allahu akbar" will be reported for racism.

Instead, our pasty friends are simply told by authorities to stay indoors, refrain from calling people names "hate crime" on social media, and simply whimper until the situation stabilises... which it won't. It is one major reason why Brexit exists.

Fortunately, I have a solution.

If your neighbour is a jihadi, you just need to ring up Mr. Plod. Tell him some fella on Twitter, who goes by the name of @onlytwogenders, called you a bloke, when in fact you've made it very, very clear that you're "gender fluid"... and give him your Afghan neighbour's address. They'll be around with a tank and a Swat team in a flash.

This brings me to Brexit, which is a result of many things, but certainly one of them is our British friends' aversion to being... well, you know... knifed.

And so while Mr. Plod is hunting folks being nasty on Instabook and Facegram and crime soars, the rallying cry for Brexit will increase. And many other Europeans will follow suit when their turn comes.

European governments, due to socialist Ponzi schemes, have created a financial and now domestic social fustercluck.

Implications?

Can you spot a solid trend?

-Chris

"We have collected from today's young to pay today's old and counted on tomorrow's young to keep doing so. That was a fine scheme as long as the number of young people was rising faster than old people. When that ratio comes to an end, such a system also has to end." — Milton Friedman

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