How Greece's Crisis Could Become Our Own

[Wakka]

If Greece has to write-down its debt and pay its European lenders a fraction of their promised returns, the situation could get ugly. Desmond Lachman explains (reminder of the interconnectivity of European debt after the excerpt)

The even greater risk to the European banking system from a Greek failure is that it would bring very much into play Portugal, Spain, and Ireland. These countries, which between them have around US$1.5 trillion in sovereign debt, suffer from similar, albeit less acute, public finance and international competitiveness problems. And they too are stuck in a Euro-zone straightjacket that severely constrains their ability to deal with these problems in a credible manner.

In considering the timing of the Federal Reserve's exit strategy, Bernanke would make the gravest of errors were he to underestimate the potential fallout of a Greek failure on the U.S. and global economies. For not only would a further shock to the European banking system diminish U.S. export prospects by tipping the European economy back into recession and by materially weakening the euro, it would also all too likely be accompanied by a return in spades of risk aversion in global financial markets.

Source: http://www.theatlantic.com/business/archive/2010/05/how-greeces-crisis-could-become-our-crisis/56412/

 

[Brother Mike]

Wakka, it was about a 39 billion euro bailout. That is about the same in U.S dollars, a little less.

We gave how much to car company's ?? 18 billion?

How about that failed bank bail out?

Now we are trillions in debt, so where does that bailout money come from?? It's magic I guess, it just shows up.

Now, China posted a national debt to other governments of around 370 some Billion. We owe China.

Now you posted 5 more counties in debt up to a Trillion dollars. Russia has debt after it fell apart taking on a bunch of stuff I don't understand.

So, Wakka, it seems that all the major countries owe something to someone, which does not add up. If we all come at a loss, then where is that missing money? I mean we can't all owe each other and not someone coming out of debt.

I don't think it really matters anymore...........Time is getting shorter...............

Be blessed.

Jesus Is Lord.

 

[jerryjohnson]

... then where is that missing money?

...

I don't have it! : :huh:

 

[Wakka]

A country typically gets its money from three sources.
1. Taxing people
2. Printing more money
3. Borrowing money

None of the politicians in Washington would dare to tax people more otherwise their political careers would be very short. That's what the Governator of California is doing and that is why California is so much in debt. The United States isn't really introducing more money into circulation.

The United States gets most if its fundig from China. Currently, the United States owes 877 billion USD to the People's Republic of China. Each year we are paying about 37 billion US dollars in interest. Think about that. The US tax payer money is directly funding the People's Republic of China.

 

[Brother Mike]

JerryJohnson:

I don't have it!

Would be cool if you did..... Just think of how you could bless everyone on the forums.... You would bless us, right?? :unsure:



Well, Wakka, none of it adds up. We are trillion in debt, paying 37 Billion in Interest to China, Meaning that is just free money out of our pockets, and other Counties are all in debt with interest....................

Ummm. could it be that the total money, plus interest owed totals more that what is available on the planet?? If that is the case, this thing is real messed up.....

Unless, JerryJohnson is not being fully honest with what he has and does not have.......... <_<

Be blessed Brothers!!!!

Jesus Is Lord.

 

[Wakka]

Brother Mike, all of the gold mined in human history (roughly 161,000 tonnes) sums up to about $5.2 trillion USD. (based on 2009 data)

US gold reserves equal to about $11 billion.

Here's an interesting article on gold: http://ngm.nationalgeographic.com/2009/01/gold/larmer-text/3

 

[01CobraVortech]

Trust me America is in worse shape than Greece or the EU. Its on the hook for $65 trillion of unfunded liabilities over the next decade. Its been bankrupt through the Federal Reserve system which is just a giant ponzi scheme. We have a commercial real estate crisis expected later this year as banks start providing more data on that sector and hyper inflation is inevitable. And China's imminent bubble crash is going to hit America hard. Unfortunately, all these economic stimulus packages that the nations have passed are just delaying the inevitable. The day of reckoning has come for the currencies of the world and we are watching the insolvency of the dollar right before our eyes. The American consumer simply hasn't seen that impact yet in food or energy prices. You just can't keep printing money forever. The stimulus bill passed in the states and "cash for clunkers" just delayed the complete collapse of the economy. I'm not even sure that the average American understands the insurmountable debt the USA has. The current federal deficit doesn't even reflect the spending of both wars. Nations throughout history have gone bankrupt before by endless wars.

 

[Wakka]

What China has that we don't have is the ability to run on a command economy. China will recover much quicker than we ever will.

 

[01CobraVortech]

I think every nation around the globe will recover long before America will because the Federal Reserve system is what's made the dollar dysfunctional. Its important to note though, that China has a serious problem on its hands. Its been manipulating the value of the yuan for some time and its day of reckoning is coming as well. The global, financial meltdown we are watching right now on this planet exceeds anything seen ever before. This is far worse than anything seen during WWII and the national press has hid the sheer magnitude of the danger the world economy is in. The global economy is so interconnected now, that its inevitable for a currency restructuring. It simply is impossible to stop the death of the dollar at this point and many nations are quietly starting to move away from the dollar being its reserve currency. Folks, we've had a great run but our days are numbered, sad to say. We've had many people within the NWO scene working hard for decades to get this planet to this point and no Christian should be surprised given that the good Lord informed us in the Book of Revelation that there would be a global government, currency and ecumenical religion in the latter days. We in this generation are now watching the last pieces being put in place to this incredible scenario that for centuries was not understood by Christians.

 

[Wakka]

There is a really interesting Socialist economist that talks about this. What's nice about him being socialist is that he doesn't try to hide or sugar coat the story and openly denounces those at wall street that have caused the financial meltdown of 2008. He simply offers a different opinion, you don't have to hear his "social" message that's at the end of the presentation. http://www.youtube.com/watch?v=TZU3wfjtIJY (just skip to 7:10 right off the bat).

As for his credentials, he's a historian, economist, and professor of economics. He was enrolled in Harvard, Yale, and Stanford.

 

[01CobraVortech]

Thanks for the link. I'm a bigger fan of Gerald Celente, G. Edward Griffin and Jerome Corsi when it comes to understanding our current economic woes.

 

[Christina]

I must agree with Wakka and Robster here its not how much Greeces debt is that matters
The IMF is for short term loans the U.S. gives the most ... If Portugal and Spain follow it will crash the Euro that means the U.K. (briton) to keep the IMF in business then falls to U.S. and Japan we do not have the money to bail out all Europe. Nexy step the dollar crashes, China and the Arab oil based nations will be best off but even they will soon fail if the U.S. and Europe cant buy their goods.
Keep your eye on this situation it could be the start of the deadly wound to the World......
which A.C. will heal

 

[01CobraVortech]

I must agree with Wakka and Robster here its not how much Greeces debt is that matters
The IMF is for short term loans the U.S. gives the most ... If Portugal and Spain follow it will crash the Euro that means the U.K. (briton) to keep the IMF in business then falls to U.S. and Japan we do not have the money to bail out all Europe. Nexy step the dollar crashes, China and the Arab oil based nations will be best off but even they will soon fail if the U.S. and Europe cant buy their goods.
Keep your eye on this situation it could be the start of the deadly wound to the World......
which A.C. will heal

Christina you perfectly explained how the dominoes will fall. Like you indicated, the EU is teetering right now on collapse. I'm watching with great interest myself to see if there is a politicians that will soon emerge that keep its together and if he's consistent with having the Assyrian ethnic traits. I also speculate that there is a strong possibility that the EU gets scaled down to 10 nations, being Western Europe. But I guess we'll see soon enough. These are truly awesome times we are! Think about how many Christians for the past 1900 years wondered how things would play out and how things would look according to scripture? And I firmly believe that we are the fortunate ones to see these things to pass. Praise the Lord Jesus Christ!

 

[Wakka]

Oh wow...

EU Crafts $962 Billion Show of Force to Halt Crisis

May 10 (Bloomberg) -- European policy makers unveiled an unprecedented loan package worth nearly $1 trillion and a program of securities purchases as they spearheaded a drive to stop a sovereign-debt crisis that threatened to shatter confidence in the euro. Jolted into action by last week’s slide in the currency to a 14-month low and soaring bond yields in Portugal and Spain, governments of the 16 euro nations agreed to make loans of as much as 750 billion euros ($962 billion) available to countries under attack from speculators.

The ECB will also embark on “very significant operations,” European Union Economic and Monetary Commissioner Olli Rehn told reporters in Brussels after the 14-hour meeting. “The ECB has taken a decision to intervene in the secondary markets of government securities.”

Under pressure from the U.S. and Asia to stabilize markets, the European governments gambled that the show of financial force would prevent a sovereign-debt crisis and muffle speculation that the 11-year-old euro might break apart.

Europe’s failure to contain Greece’s fiscal crisis triggered a 4.1 percent drop in the euro last week, the biggest weekly decline since the aftermath of Lehman Brothers Holdings Inc.’s collapse. It prompted President Barack Obama to call German Chancellor Angela Merkel and French President Nicolas Sarkozy yesterday to urge “resolute steps” in Europe to prevent the crisis from cascading around the world.

Under the loan package, euro-area governments pledged to make 440 billion euros available, with 60 billion euros more from the EU’s budget and as much as 250 billion euros from the International Monetary Fund, said Spanish Economy Minister Elena Salgado.

“We are placing considerable sums in the interests of stability in Europe,” Salgado told reporters after chairing the meeting.

http://www.bloomberg.com/apps/news?pid=20601085&sid=ap50DW8IqhBo

 

[01CobraVortech]

We'll see how the markets respond to this one tomorrow. That's a lot of moola schmoola. But I doubt its going to work. These bailouts and stimulus packages just don't work. You're still printing and borrowing. Just creating money out of thin air just puts off for another day, the day you have to square up. But I understand that they also do it more as a psychological boost, than as a genuine fix to the problem.

 

[Wakka]

All they're doing is literally buying time so that their markets can continue working and that they could think of a way out of this mess.

Do any of you know of Tariq Ali?

 

[HammerStone]

None of the politicians in Washington would dare to tax people more otherwise their political careers would be very short. That's what the Governator of California is doing and that is why California is so much in debt. The United States isn't really introducing more money into circulation.

I wouldn't be quite so sure about that. Politicians in general are good at PR, and you're already seeing more "fees" and "penalties" at the lower levels (as well as some federally). Get ready to see more such means of driving revenue....which is a term also used in favor of taxes. The government needs to increase revenue. (It's not the ITS, its the IRS.)

The other side of the coin is many of the new taxes are well disguised. You have the more obvious carbon trade agreement in the works, but you're going to see other things like the new taxes with medical devices. Since the public does not pay attention to things like that, the cost of medicine is still up, it's just hidden away in other spending/taxing programs.

If you understand the modern system, you begin to see that all of this is virtually carried out on paper. It's paper money on a paper balance sheet, governments have the power to manipulate as they see fit. This is what we call Socialism and eventually Communism - the government owns the means of production (or service) and so someone has to pay for those services. The popular thing the past 50-60 years has been to simply hide away the accounting costs and let some other generation deal with things as you buy votes on credit. The problem now is that all of these social programs are coming home to roost.

I think its 75/25 the Euro fails in the next 5 years. It will be propped up, the question is how long can the house of cards stand?

China has a command economy, but the US has a command monetary system. Unfortunately its not the control that is lacking, it is the logic. Since the turn of last century, certain groups have been in charge. You can call them whatever you want and believe their purposes are whatever you want, but there is no denying a very specific group of people have much control of the US economy. As with health care, it's going to happen whether you like it or not.

I'm watching the local school system flounder and literally fail before our eyes.

 

[01CobraVortech]

Ultimately its the Federal Reserve ponzi scheme that's brought America down to its knees. And its goal has finally been accomplished with the help of the "right" actions by our governmental leaders.

 

[Christina]

This is not even close to over

Fears Intensify that Euro Crisis Could Snowball
http://www.cnbc.com/id/37185573

By: Nelson D. Schwartz and Eric Dash
The New York Times

After a brief respite following the announcement last week of a nearly $1 trillion bailout plan for Europe, fear in the financial markets is building again, this time over worries that the Continent’s biggest banks face strains that will hobble European economies.

In a sign of the depth of the anxiety, the euro fell Friday to its lowest level since the depth of the financial crisis, as investors abandoned the currency as well as stocks in favor of gold and other assets seen as offering more safety.

In trading early Monday morning, the euro declined again, managing at one time to reach a four-year low relative to the dollar.

The president of the European Central Bank, Jean-Claude Trichet, in an interview published Saturday, warned that Europe was facing “severe tensions” and that the markets were fragile.

For Europe’s banks, the problems are twofold. Short-term borrowing costs are rising, which could lead institutions to cut back on new loans and call in old ones, crimping economic growth.

At the same time, seemingly safe institutions in more solid economies like France and Germany hold vast amounts of bonds from their more shaky neighbors, like Spain, Portugal and Greece.

Investors fear that with many governments groaning under the weight of huge deficits, the debt of weaker nations that use the euro currency will have to be restructured, deeply lowering the value of their bonds. That would hit European financial institutions hard, and may ricochet through the global banking system.

Bourses and bank shares in Europe plunged on Friday because of these fears, with Wall Street following suit. Shares were also down in Tokyo and Australia in early trading on Monday.

“This bailout wasn’t done to help the Greeks; it was done to help the French and German banks,” said Niall Ferguson, an economic historian at Harvard. “They’ve poured some water on the fire, but the fire has not gone out.”