Thread: Greek Tragedy Goes Global: Bankster Occupation

Greek Tragedy Goes Global

By Stephen Lendman
7-8-11

After Greece's government surrendered to banker occupation, trends analyst Gerald Celente told Russia Today that:

America's "economy continues to decline. There's no recovery in sight." Across Europe in Greece, Britain and elsewhere, people are reacting against forced austerity to assure bankers get paid.

In fact, Trends Journal months ago called it "off with their heads 2.0....The global ponzi scheme is under collapse....whether it's in Egypt, Tunisia, whether it's in the UK, Greece. Watch out for Spain. Here comes Italy. Ireland's coming up the backstretch. It's only going to get much worse."

"The people know the score....What killed capitalism (is explained) in four simple words: too big to fail...The banks are failing, and they want the people to bail them out....I want to make this clear. The IMF is nothing more than the International Mafia Federation, the loan sharks of last resort, and the people know it. They call it privatization. Adults call it stealing valuable public assets, and selling them to your friends really cheaply."

In all these countries, "the politicians only represent the people who give them the most amount of money....And what do these austerity measures bring - a lot more poverty and unemployment." People know it. They're mad, and they're reacting globally.

Expect it eventually in America, the heart of predatory capitalism, stealing from the many for the privileged few, bankers and war profiteers always first in line for handouts, as much as they want whenever they want it.

On July 2, long-time former insider, market analyst/observer Bob Chapman said world markets, especially America's, "are in a state of uneasiness, and it's only a matter of time before they degenerate further. The real question is will everything break loose between now and the end of the year?" In part, it will, and it's currently happening.

In fact, problems Chapman explained months ago "are coming together like a bad dream. This could be a replay of 2008, but for a different set of reasons." Wall Street is a reliable leading indicator.

On June 16, New York Times writer Susanne Craig headlined, "Wall Street Braces for New Layoffs as Profits Wane," saying:

"Wall Street plans to get smaller this summer." Faced with economic weakness, "many of the biggest firms are preparing for deep cuts in jobs and other costs." According to Normura analyst Glenn Schorr, "It's a tense environment right now," suggesting hard times perhaps returning soon.

According to Chapman, Greece's problems weren't solved. They're festering greater than ever. More on that below. Moreover, sovereign nation debt ratings "are falling like ten-pins. (We believe that) euro, (Eurozone) and European Union problems....are unsolvable."

"Little has been done to repair" the 2008 debt crisis. Conditions across Europe, Britain and America are no better. Sooner or later Greece will default, perhaps causing "a collapse of the world financial system, as we know it....The entire financial sectors" in Western countries "are more vulnerable now than ever" and getting worse.

Watch out. Failure somewhere could trigger panic globally. Moreover, China's economy is slowing. Major inflation and real estate bubble problems exacerbate it, and Japan's now back in recession. Overall, talk of recovery is illusion, not fact, in the face of growing global deterioration.

Financial expert and investor safety advocate Martin Weiss has been warning regularly about deepening debt crises and likely defaults. On July 4, his latest report is headlined, "Why the Great Greek Tragedy Has Barely Begun," saying:

The likelihood of Greek debt default is much higher than ever, what Western governments and media won't explain until its debt bubble implosion no longer can be hidden.

Have bailouts helped? Absolutely not! In fact, global institutional investors believe "the probability of a Greek default is FOUR times greater today than (when) European officials announced" their bailout.

Moreover, when Lehman Bros. failed in September 2008, "the most investors were willing to pay for $10 million in Greek debt default coverage was $52,000. Today, they're paying 45 times more!"

In fact, they know that force fed austerity, including tax hikes, layoffs, spending cuts, lower government revenues, and public asset fire sales won't avoid default. It's not if, just when and how badly contagion spreads globally.

What Greece and other troubled economies, entrapped by IMF mandates, have done is sign their "own death warrant." Greece's loans will keep it going another few months at most, "through the summer, but not a single second longer," so it's back for more help, more cuts, higher unemployment, less revenue, greater poverty on the road to financial oblivion like other countries on the same path.

As a result, Weiss sees three major financial crises ahead:

(1) Already reeling from America's greatest housing depression, US banks face more crushing burdens ahead because of their exposure to European banks that have loaned billions to Greece. When they're hit, US banks go with them, those most exposed hammered hardest.

(2) Vulnerable US money funds have "half of their $1.6 trillion in assets in European banks." Moreover, "50 million Americans have money in those funds!" When Greece defaults, they'll be hard-pressed to repay what they borrowed. As a result, "breaking the buck" may follow, meaning their share price value will fall below $1, what most investors once thought impossible, but it happened after Lehman collapsed.

In late June, even Bernanke admitted that European bank exposure "pose(s) some concern to money market mutual funds," a rare divergence from past rosy scenario predictions.

However, danger signs extend well beyond money funds. Virtually all global debt markets are vulnerable, including corporate commercial paper and US Treasuries. When crisis conditions deepen globally, no financial assets are safe. As a result, catastrophic consequences are possible.

(3) "Washington is suffering from the same debt disease as Athens," multiplied many times over. As a result, every hardship Greece now faces offers "a sneak preview of what could be in store (for America), barring" an unlikely major political miracle as lawmakers debate exacerbating measures, not healing ones. No wonder Weiss advises, "Above all, stay safe!"

In Part 2 of his May Quarterly Letter to investors, GMO asset management firm co-founder and chief strategist Jeremy Grantham headlined, "Time to be Serious" by lightening up on risk exposure at a time stocks are 40% overvalued and fixed income "badly overpriced."

With red flags emerging everywhere, now's "not the time to float along with the Fed, but to fight it," meaning safety is essential over risk as beating odds gets longer in a global economy getting sicker, not better, but don't expect Western governments or media to explain.

http://www.rense.com/general94/greek.htm

ECB tightens noose on Southern Europe

The European Central Bank has raised interest rates a quarter point to 1.5pc to curb inflation and signalled more to come, despite faltering growth in southern Europe and acute stress in peripheral bond markets.

By Ambrose Evans-Pritchard

9:27PM BST 07 Jul 2011

Comments137 Comments

Jean-Claude Trichet, the ECB's president, brushed aside warnings that tightening at this delicate juncture might push Spain and Italy into the danger zone, insisting that every eurozone country stands to lose if the ECB fails to anchor price stability. Inflation risks "remain on the upside", he said, using coded language that opens the door to further rate rises over the Autumn.

As expected, the ECB waived its collateral requirements on Portuguese bonds, clearing the way for the country's banks to continue tapping the ECB's liquidity window following Moody's downgrade of Portugal's debt to junk. The ECB has already waved the rules for Greece.

Unlike Anglo-Saxon peers, the ECB is unwilling to gamble that inflation will fall back after spiking to 2.7pc in June on fuel and food pressures. But the hardline policy contains its own risks.

Yields on Italian 10-year bonds rose to a post-EMU high of 5.21pc yesterday. Spanish yields reached 5.71pc before settling down slightly. The bond jitters follow a slew of grim data pointing to an economic relapse in both countries.

"The debt problems are contained in Spain and Italy for now but the eurozone is dealing with finer and finer margins," said Simon Derrick, currency chief at the BNY Mellon.

"The situation is magnitudes worse than where we were a few months ago and the global outlook is following the pattern of mid-2008 before the Lehman crisis, so people are getting nervous," he said.

Italy's finance minister, Giulio Tremonti, unveiled a draconian plan yesterday to balance the budget by 2014 and stay a step ahead of the bond vigilantes, warning of "disaster" unless €48bn of cuts were passed. "What is at stake is the survival of civil society in this country," he said.

With low private debt, Italy has managed to stay out of the maelstrom so far. However, its public debt is the world's largest after the US and Japan at €1.84 trillion. The upward creep in yields has begun to attract unwelcome attention, notably among Asian investors.

Hans Redeker, currency chief at Morgan Stanley, said the danger for the eurozone is that long-term investment inflows have dried up. They have been replaced by a growing reliance on hot money funds, attracted by Europe's higher rates.

"This money is fickle. It will move out on the slightest sign of trouble. Europe's capital flows are sounding alarms," he said. By raising rates, the ECB may have made matters worse.

Mr Trichet emphatically opposed any form of selective default on Greek debt, fearing that it could scare away investors and set off fresh contagion in the eurozone. "We say, no, full stop," he said.

Europe's political leaders have the ultimate say however and they are hardening their stance on private sector "burden sharing". The Dutch finance minister, Jan Kees de Jager, told The Daily Telegraph that it would be "very difficult" to secure voluntary participation from the banks so other methods will be needed.

"We are exploring several possibilities. If we continue down the current road, all private debt in Greece will be converted into sovereign debt and we will have bailed out the banks," he said.

The ECB has the unenviable task of trying to bridge the North-South gap with a single interest policy. Germany's industrial machine is powering ahead on exports to China, Russia, and the Mid-East; while Spain seems trapped in near-depression, with unemployment at 21pc.

The ECB's monetary tightening has asymmetric effects, with greater impact on heavily-indebted and rate-sensitive economies in Spain and Ireland than on core Europe.

Over 90pc of Spanish mortgages are priced off the floating 1-year Euribor rate, which has risen 66 basis points to 2.19pc this year. Only 20pc of German loans are on floating rates.

Rate rises are ratcheting up the pressure as each month a fresh cohort of Spanish households sees a sharp upward adjustment in their mortgage payments. There is a hangover of 680,000 unsold properties on the market, according to government figures.

"There is no sign of recovery," said Raj Badiani from IHS Global Insight. "House sales are falling again at double-digit rates and if this spills over into 2012, the pressure on the Spanish banking system could become unbearable," he said.

http://www.telegraph.co.uk/finance/econ ... urope.html

Europe descends into monetary madness

Perhaps it’s crisis fatigue, but monetary policy in Europe seems to have descended into madness.



By Jeremy Warner

10:46PM BST 07 Jul 2011
145 Comments

With much of the eurozone (inflation rate 2.7pc) flirting with insolvency, the economy visibly slowing and money growth barely positive at all, Jean-Claude Trichet and the rest of the European Central Bank governing council think the time is right for another hike in interest rates.

Meanwhile, in Britain (inflation rate 4.5pc and rising), the Bank of England is sticking rigidly to the idea that the spike in prices is temporary and that the current zero interest rate policy should therefore be maintained.

Should it not be the other way around? A visitor from Mars would make Sir Mervyn King and Jean-Claude Trichet swap jobs, and then we might see sense prevail in both economic jurisdictions.

With the ECB, it will be recalled, current events almost exactly mirror what happened three years ago when, with commodity prices spiking in the last hurrah of the boom, the ECB saw fit to implement its “strong vigilanceâ€

Suicide rates rise as debt and cuts take their toll

By Nina Lakhani
Friday, 8 July 2011

Suicide rates have risen sharply across Europe since the banking crisis as people struggle to cope with debt, unemployment and public service cuts.

Britons fared worse than average, with an 8 per cent rise in suicides between 2007 and 2009 – a shock after almost a decade of annual declines, according to research in The Lancet.

The mental health of people in countries worst hit by the crisis such as Ireland and Greece suffered most. In Greece, 16 per cent more people killed themselves in 2009 than 2007, a large increase, even before the huge financial bailouts hit jobs, pensions and public services. The Irish have suffered a similar fate, with a 13 per cent rise as people face up to home repossessions and dire long-term prospects.

The research is the first large-scale analysis of the impact of the recession on health, and it strongly suggests governments have failed to learn the lessons from previous economic downturns.

Countries that have a fair benefits system and strong programmes to help people back into work quickly have historically avoided suicide spikes during recessions.

Dr David Stuckler, lead author and lecturer in sociology at the University of Cambridge, said the findings were "terribly frustrating". "Human beings are the real tragedy of an economic crisis, so it is terribly frustrating that government leaders have not only failed to invest in programmes that protect people, but have actually done the opposite... This has been the pattern for three and a half decades but lessons have not been learnt," he said.

For every suicide there are on average 10 failed attempts and thousands of depression cases, which are much harder to count. Dr Peter Byrne, consultant liaison psychiatrist at Newham University Hospital in east London, said he has seen an increase in patients who have self-harmed or attempted suicide because of "personal debt, loss of hope and uncertainty".

Dr Andrew McCulloch, chief executive of the Mental Health Foundation, added: "The right health, social care, housing and employment support services must be available to help vulnerable people in need now."

http://www.independent.co.uk/life-style ... 08885.html