Paul Krugman: Greece euro exit possible next month, Eurozone-wide meltdown incoming

[syd syside]

Paul Krugman's latest blog:

 

Some of us have been talking it over, and here’s what we think the end game looks like:

 

1. Greek euro exit, very possibly next month.

 

2. Huge withdrawals from Spanish and Italian banks, as depositors try to move their money to Germany.

 

3a. Maybe, just possibly, de facto controls, with banks forbidden to transfer deposits out of country and limits on cash withdrawals.

 

3b. Alternatively, or maybe in tandem, huge draws on ECB credit to keep the banks from collapsing.

 

4a. Germany has a choice. Accept huge indirect public claims on Italy and Spain, plus a drastic revision of strategy — basically, to give Spain in particular any hope you need both guarantees on its debt to hold borrowing costs down and a higher eurozone inflation target to make relative price adjustment possible; or:

 

4b. End of the euro.

 

And we’re talking about months, not years, for this to play out.

 

http://krugman.blogs.nytimes.com/2012/05/13/eurodammerung-2/

 

He's been saying since the crisis started that all the austarity measures have been counterproductive - and he's been right.

 

He's been saying since the crisis started that all the "bailouts" have been doing is kicking the can down the road, not fixing anything - and he's been right.

 

Also, I believe he just came back from the EU and 2) 3) and 4) isn't an some proclamation of doom, but just sharing his conversations with others that are familar (maybe more than him) with the politics of the situation.

[splesh]

I always liked the way the word drachma sounded. Bring it back, sure, why not?

[Kanakori]

2012. The year we all look back an say "We screwed up big time, maybe we should start doing things differently now"

This off course, after a 3 months period of pure chaos à la watchmen style.

 

 

Not. The common citizen will just be fucked in the ass as usual.

 

[Guest kokeboka]

If Greece bails on the euro, Portugal and Ireland are next. It will hurt us a lot, but I'm not seeing other outcomes should that happen. If Greece leaves the euro (which quite frankly is becoming a better option for them every day), the eurozone is in deep shit. Speculators will attack Spain and Italy, which are economies way too large for the IMF to "rescue". Even if Portugal miraculously keeps obeying the bailout terms (which are absolute robbery) and mantains the euro, it would be the end of the eurozone regardless. German and french exports would drop steeply, and countries like Portugal and Greece would have their economies in disarray for years for having followed EU export and production guidelines for this long. Should something like this happen, it might be as big as the real estate bubble in the US a few years ago.

 

Of course Germany can make this stop at any moment, but that's not going to happen because Angela Merkel is more concerned with public opinion. If things stay this way, even if the euro survives, we're going to see a huge rise of right-wing politicians throughout Europe (if I'm not mistaken Marie Le Pen finished 3rd in this year's french elections, which is scary). This ends up being a greater risk for the EU in the long term.

[Guest cult fiction]

As bad as this crisis is, it's amazing how far we've come since the first half of the 20th century. This crisis would very likely have spiraled into a pan-European(and eventually world) war had it occurred then. Financial globalization has had its share of downsides, but the intertwining of the world's financial fates has been great for keeping the peace.

[azatoth]

I find it pretty interesting that when creating the Euro they did not bother to think of a process on how a country could exit from the monetary union. The whole thing seems very poorly thought out and haphazardly implemented with large opportunities to cheat. I like the idea of European collaboration, but as it is now, both the EU and Euro are slow bureaucratic dinosaurus and it won't work until countries start putting Europe before their own nationalistic interests.

 

And the overall move towards neo-liberalism in economics is a shitty idea and will cause more crashes. Why do they keep insisting that austerity measures are working when it clearly hasn't done shit, instead making things even worse. They put ideology before real world empiricism when it comes to economics.

 

I doubt the Euro will completely disappear. The Northern European countries will probably stick with it but make some pretty heavy adjustments to it to safeguard from shit like this happening again.

 

Interesting times indeed.

[GORDO]

my prediction is that nothing will happen.

[Guest Al Hounos]

Yep, wild times. You just can't have a unified currency without a unified government. And well said, azatoth, we've seen that neoliberalism has failed, so let's just face the facts and get over our biases and move back towards sensible, moderate economic policy.

[goDel]

my prediction is that nothing will happen.

 

This.

 

Greece will have re-elections. Again. Until some coalition wins which will stick to IMF/Euro rules. And then there will be many years of austerity throughout the EU. With many economists/politicians crying there need to be more investments, but the fact of the matter is that slow growth will be here to stay. In other words: that which seems like kicking the can down the road, is actually trying to keep finances in check until the (world)economy provides some opportunities for actual growth. Which won't happen in the near future. At least, not more than it has already.

[goDel]

Also, what I think is the more interesting news bit is the situation at JP Morgan with the huge losses. There is a point where even Wall street bankers will have to acknowledge that the way things are currently regulated/organized need to change drastically. But that might be just my wishful thinking.

[azatoth]

I find the notion that there has and can be perpetual economic growth dubious. How can that be sustainable in the long term? Wouldn't it be worth to look into a steady state economy? Unfettered capitalism isn't the answer it seems but I am afraid there's too many moneyed interests looking to perpetuate their ideology to enrich themselves, all on the short-term without considering long-term effects.

[goDel]

I find the notion that there has and can be perpetual economic growth dubious. How can that be sustainable in the long term? Wouldn't it be worth to look into a steady state economy? Unfettered capitalism isn't the answer it seems but I am afraid there's too many moneyed interests looking to perpetuate their ideology to enrich themselves, all on the short-term without considering long-term effects.

 

Who's talking about unfettered capitalism? Their ideology? Who's their? Talking about banks? The EU? Greece? Politicians? Are you going to Occupy this thread?

[Guest chunky]

cant use military to take over a country so they use debt instead

years ago anti-semitic germans used to complain that the jews would lend money to the farmers, too much money so that they would get into debt, then the jews would call in the debt and take over the land

now germany is doing exactly this in order to take over the countries that surround it

hypocrisy in action !!! :-)

 

that jpmorgan 2 zillion didnt disappear it's in somebody's bank account right now. biggest heist of all time?

[Guest chunky]

Thursday, September 07, 2006

 

 

ROTHSCHILDS AND GOLD AND THE MASTER ORGANIST

 

 

Rothschilds and Gold and the Master Organist

 

The Rothschilds have an estimated 85% of the world's gold, elites with Rothschilds together have 95%.

 

The Rothscdhilds set the price of gold twice a day in London.

 

Pundits come up with all sorts of spin about gold going up, going down, because of this and that reason, and they miss the point entirely.

 

One has gold to preserve purchasing power of ones savings, no matter what the price is, whether it goes down to $50 per ounce or goes to $1000 per ounce. The perfect example is how many ounces of gold it takes to buy the same house. That doesn't seem to change.

 

 

 

The Rothschilds make the market in gold. That means they control the price. The Rothschild's also have most the fiat currency of the world.

 

Why the Rothschilds cornered the market on gold is to PREVENT ANY NATION FROM RETURNING TO THE GOLD STANDARD. (backing their currency with gold) To do so would eliminate the need for Fed Reserve Banks, and the Rothschilds would lose their cash cows, of their printing money on worthless paper, yet charging interest on every worthless piece of paper they print. What a marvelous deal for them! No wonder the agreements to let them manage a country's money is generally accompanied by horse's head being found in someone's bed.......to evoke cooperation!

 

My picture is this: picture the phantom of the opera seated at a huge organ with many footpedals.

 

By using different pedals, different results can be achieved by the organist.

 

One of the pedals is labeled "mortgage interest rates". Another is preferencial rates for outsourcing labor. Another is de-industrializing a country. Another assassinations, wedge issues, sexual blackmail. Another is lowering the margin rates--or the reverse, raising the calls. Another is false flags (remember the Mossad is the Rothschilds' own private black op operatives.)

 

All those wooden pedals are controlled by the Rothschilds, and playing them in groups of two or more, make new combinations, with new results. This is possible because of the ownership of the world's gold, fiat currency, printing presses, media.

 

Remember, no major event, war, occurs without Rothschilds' tacit approval. To do otherwise would be unthinkable.

 

There are very few countries that have refused to turn their money over to the Rothschilds in the form --Afganistan, Iraq (those two now just got "central banked" since our invasion) North Korea, Libia, Cuba, Syria, Iran. Germany was a holdout--and you see what happened to it following WWI.

 

What we have unfolding before our eyes is an evil, literaly satanic master plan that has been continuously followed for 50-100 years, and now is reaching fruition, barring our intervention that results in a ONE WORLD GOVERNMENT, or GLOBAL FEDERATION, and the complete loss of any rights whatsoever.

 

David Rockefeller or a Rothschild will be the tsar.

 

This plan was designed probably by Nathan Rothschild, and has been stopped by the financial health of America. America first had to be bankrupted, and brought to its knees, before "Globalization" could happen.

 

We have had all the substitute reasons for 9/11, invasion of Iraq, which are all second to the real one:

 

The real objective is the complete destruction of America.

 

Bush/Cheney/Rumsfeld/other neo fascists, and yes, OUR CONGRESS are not incompetent, they are following the plan precisely: Their job? Destroy America, and that's exactly what they are doing.

 

To empty the US Treasury thru a long series of wars from the Civil War to present day, delberately prolonged, in order to transfer as much of the nation's money as possible to the elites...... to have deliberate "no win" wars, i.e., Korea, Viet Nam, Iraq, (Iran) . (Ask a Viet Nam Vet about the "Rules of Engagement".)

 

To demoralize the people non-stop thru relentless assassinations, black ops, false flags, that never get fully investigated and resolved, take citizens jobs, their houses, their savings---to the point they'll be desperate for the government's intervention, even to the point of agreeing to giving up their guns, and martial law.

 

The timing sequence is this:

 

A financial crisis.

 

The military so weakened as to be useless except for parades.

 

Demoralization of the people thru some

crisis--from economic, germs, attack...

 

Confiscation of firearms. No martial law has ever been enacted against an armed people.

 

Martial law declared, and with that the cancellation of the Consitution and Bill of Rights.

 

Property ownership declared illegal.

 

Troublemakers, real or imagined, put in work camps.

 

malaprop aka izzy

 

posted by malaprop aka izzy at

[goDel]

Daily mail, your daily source of FruityLoops.

[Dale]

There is no such thing as a stable monetary economic system. It's time to rethink things drastically.

[Guest chunky]

"From around the turn of the century, under Chamberlain's influence, and unnerved by the rising tide of democracy and socialism at home and Germany's increasingly exposed position internationally, Wilhelm II gave voice ever more openly to anti-semitic convictions. Susan Townley records a conversation in which the Kaiser described the Jews as the 'curse' of his country. 'They keep my people poor and in their clutches, he complained. 'In every small village in Germany sits a dirty Jew, like a spider drawing the people into the web of usury. He lends money to the small farmers on the security of their land and so gradually acquires control of everything. The Jews are the parasites of my empire. The Jewish question is one of the great problems I have to deal with, and yet nothing can be done to cope with it!"

 

Germany blaming innocent jews for everything, then 100 years later doing exactly what they blamed the jews for doing. Hypocrisy is the word. Germany now using usury to take over Europe instead of Prussian militarism

[goDel]

This is getting tiring pretty quick.

 

Here, have a new hobby:

[azatoth]

I find the notion that there has and can be perpetual economic growth dubious. How can that be sustainable in the long term? Wouldn't it be worth to look into a steady state economy? Unfettered capitalism isn't the answer it seems but I am afraid there's too many moneyed interests looking to perpetuate their ideology to enrich themselves, all on the short-term without considering long-term effects.

 

Who's talking about unfettered capitalism? Their ideology? Who's their? Talking about banks? The EU? Greece? Politicians? Are you going to Occupy this thread?

 

The general neo-liberalism that seems to sweep across politicians in Europe, influenced by the moneyed interests who would gain by having less regulation and oversight. Obviously deregulation hasn't been working too hot has it, same with austerity. I am just saying the way things are done now isn't doing any good, time to sit down and have a good think instead making any hasty decisions.

I think the Occupy movement, as misguided and inefficient as it might be, is just a symptom of a larger discontent people are starting to feel in regards on how the current economic systems are working.

 

You seem to be very dismissive or apathetic about discussing these sort of things. I know it often goes to polemics and unfounded conspiracy theories, but mind sharing what you think about the current situation and bring some knowledge to us ignorant plebs foaming at the mouth hating on the elite.

[schlucharski]

I have a message for Paul Krugman: stay the fuck out of europe you positivistic chino pants wearing cunt.

[Guest kokeboka]

This isn't just about economic ideology. The average european voter is rapidly losing faith in moderate center parties because these policies are leading nowhere. This whole thing started because speculators drove interest rates through the roof for a number of countries regardless of their debt status. The EU could've stopped this by creating a special low-interest credit line, by creating euro-bonds, or by creating a special EU credit rating agency - they did none of this. Because this a) is not okay under neo-liberalism market theory, and b) the majority of lenders to the countries in trouble are german, english and french banks. The IMF charges insane interest rates for their "bail outs", Portugal, Ireland and Greece are being fleeced by their rescuers and friends in the EU. On account of this, people are losing their jobs, their quality of life and are quite right to be angry - greeks want a real change, they're showing it in the polls.

 

You need investment to generate growth, not austerity and patience. Sure, the EU can keep ignoring greeks and selling austerity for a while, but that can only sustain itself for so long.

[Guest Gary C]

my prediction is that nothing will happen.

 

I'm totally done with financial news this year. It's as pointless as political news has been this year. It'll get interesting when there are bomb threats and riots in the summer.

[Guest Gary C]

This is getting tiring pretty quick.

 

Here, have a new hobby:

 

Let's make this an Alison Brie thread:

 

[syd syside]

[goDel]

I find the notion that there has and can be perpetual economic growth dubious. How can that be sustainable in the long term? Wouldn't it be worth to look into a steady state economy? Unfettered capitalism isn't the answer it seems but I am afraid there's too many moneyed interests looking to perpetuate their ideology to enrich themselves, all on the short-term without considering long-term effects.

 

Who's talking about unfettered capitalism? Their ideology? Who's their? Talking about banks? The EU? Greece? Politicians? Are you going to Occupy this thread?

 

The general neo-liberalism that seems to sweep across politicians in Europe, influenced by the moneyed interests who would gain by having less regulation and oversight. Obviously deregulation hasn't been working too hot has it, same with austerity. I am just saying the way things are done now isn't doing any good, time to sit down and have a good think instead making any hasty decisions.

I think the Occupy movement, as misguided and inefficient as it might be, is just a symptom of a larger discontent people are starting to feel in regards on how the current economic systems are working.

 

You seem to be very dismissive or apathetic about discussing these sort of things. I know it often goes to polemics and unfounded conspiracy theories, but mind sharing what you think about the current situation and bring some knowledge to us ignorant plebs foaming at the mouth hating on the elite.

 

You talk like there's some sort of ideology spreading. Too many words which are way too big, imo. I think it's pretty "obvious" that in a time where governments have to spend less, they are looking for ways to have some external institutions do the things they used to do. This is more pragmatism than ideology. This general spread of "neo-liberalism" is more like a tiny - non-ideological - cold, imo. Take the outcome of the recent presidential elections of France, for instance.

 

I'm sure Monsieur Hollande does not fit the neo-liberal stamp. Is this the end of the neo-liberal sweep across Europe? Do you actually think that policies will change drastically with more leftwing parties behind the wheel? I don't think so. I have some ideas why, but I'm more interested in what you think tbh. Because things like this tell a lot about whether the expectations people have are realistic or not.

 

This may come across as dismissive or apathetic, but the "obvious" aspect in discussions like these is that the use of terms like "obvious" are dismissive in itself. To me it's "obvious" that it's not "obvious". Add some ideologies into the mix and you've got yourself a recipe for an apathetic discussion.

 

One of the "obvious" things is there aren't many economists in agreement about anything. That in itself speaks volumes.

 

Economy is one thing. Policies, politics and government is entirely different. One economist would argue the EU is a disaster and the other would argue the opposite. They're both probably wrong, no matter how ingenious their arguments. And they're both right, no matter how stupid their arguments. From the governments point of view the only goal is to steer clear from escalations as much as possible. And given the circumstances I actually think they're doing OK. The more boring government is, the better. And European government tend to be boring as hell if you ask me. So, big woop for that!