JANE BURGERMEISTER REPORT:’ THE TIME HAS COME TO CALL THE ECB’S BLUFF AND END THIS EURO PONZI SCHEME’
The ECB is threatening to cut liquidity off to banks and wreck financial mayhem in the event that Greece defaults or restructures its debt. This in spite of the fact that Greece is set to run out of cash on July 18th and is sliding into lawlessness because of the very austerity measures which the ECB is advocating yet more of.
The time has come to call the ECB’s bluff. The ECB has much more to lose by a default and by cutting off liquidity to banks than the people of Greece or Europe. It would mean the moment when the criminal actions of the ECB — which has been hiding 100s of billions of euros of worthless loans on its books to milk taxpayers — would become apparent to everyone and so spell the political end of the ECB chiefs and the public-sector Ponzi scheme they have been running with the euro currency.
A change to the ECB’s operational rule to authorise the bank to give liquidity directly to governments and banks at no interest and without booking a corresponding debt n the balance sheet is all that is needed to resolve this eurozone debt crisis. Once the ECB chiefs are removed, the rebooting of the eurozone economy could start immediately. The Greek and other governments could be given liquidity from the ECB directly to allow managed insolvencies and fund a Marshall Plan for economic growth.
ECB chiefs appear to be terrified of a Greek default for purely personal reasons.
They know that if Greece defaults or restructures its debt, then hundreds of billions of euros of worthless loans that the ECB should never have made in the first place will have to be placed on its books and the tax payers of Europe will wake up to the fact they are the ones expected to pay, and there will be political mayhem. Their role in this crime puts them at the front of the firing line.
The ECB clearly hopes that it can keep up the illusion that it will get the money it loaned to Greece, Ireland and Portugal back and the country’s are illiquid and not insolvent until the new eurozone fund comes into place in 2013 to provide a mechanism to suck yet more money from the tax payers as part of this historical Ponzi scheme as Mario Blejer called it.
If the ECB has to put the losses onto its books before then, then the ECB debts will have to be paid up by national governments. Tax payers will feel the huge bill fast, and they will be very angry. Credit rating agencies could even start to downgrade Germany, the main paymaster, when it becomes clear that not even Germany can manage the outstanding ECB debt let alone the whole eurozone debt when this Ponzi scheme has run its course.
The turmoil caused by the ECB and banks wrecking financial mayhem now in the event of a Greek default when they can easily supply liquidity — making it absolutely clear that this is blackmail — will be far less than the total economic, financial, social and political breakdown of the eurozone in a year, and it will put an end to the Ponzi scheme once and for all.
The ECB is already the biggest holder of Greek souvereign debt but its share of worthless souvereign debt is growing all the time and it is set to take on Irish and Portuguese debt. No one seems to know just how much debt the ECB has put on the shoulders of tax payers.
The ECB has„”skeleton” risks on ECB’s balance sheet amounting to several hundreds of billions of euros, reported Der Spiegel this weekend.
ECB has been giving money to banks in return for collateral asset-backed securities that low or non-existent debt ratings, knowing the tax payer will have to pick up the huge bil.
The illusion that Greece can meet its debt obligations and is only illiquid would be destroyed as soon as the country defaults. Greece would have to be put into a managed insolvency as would Ireland and Portugal because they are also insolvent. It is clear that Grece is going to have to default very soon anyway.
A year after Greece got a €110-billion ($159-billion) bailout from its euro partners and the IMF, it is clear to everyone that the tax hikes, public spending cuts have pushed the country deeper into debt while the bailouts have generated astronomical profits for the banks.
The ECB has been lending the banks money to buy Greek bonds at 0% interest.
Thanks to the penal EU/IMF bailout interest rates, banks have seen a steady return of tax payer money of about 6% on those bonds that cost them nothing to buy – and so been able to loot hundreds of billions from tax payers with the complicity of the ECB and governments. The ECB’s role in triggering Greek souvereign debt crisis also needs to be examined.
The ECB is now demanding that the Greeks sell billions in state assets but it is clear to everyone that the country is completely broke and according to German media, Greece has only got enough money to pay ist bills until July 18th.
Simply taking over the country to force sales as Jean Claude Juncker advocates is unacceptable politically and will only postpone the inevitable default and make it worse.
The FT reports that even hospitals are no longer able to pay their medicines bills.
“The pharmaceutical industry says only 30 per cent of €1.2bn in payments owed by public hospitals since the start of last year have been made. Of debt due from the start of 2011, just 1 per cent has so far been paid.,” writes the FT.
The army is set to be deployed in Athens for the first time since military rule ended in 1974, according to Greek media, as the country slides into lawlessness.
The country is already slipping into anarchy and civil war and a failure to stop this development will lead to a political emergency in the eurozone to match the financial crisis. The country is insolvent. The looting must be stopped. The ECB must be stopped.
A default by Greece would force the ECB to acknowledge that it will never get the money back, and compell it to put the losses on its books. The euro “public sector” Ponzi scheme which is based on the narrative that Greece, Ireland and Portugal are only being loaned money by the ECB and the tax payers will never have to pay would come to a shuddering halt before more damage is done.
The ECB is behaving like a street criminal pulling out a switch knife to rob a victim by threatening to cut off liquidity to banks and create financial mayhem.
The ECB can give banks as much liquidity as they need – and it can also give governments as much liquidity as they need at no interest. It is profitable for the banks for the ECB to give them money to loan to governments. But it is ruinous for the people.
All that is needed to reboot the eurozone economy is a change in the operational rules to allow the ECB to give liquidity to governments and banks at zero interest rate and without booking a debt.
The gigantic euro debt crisis is an illusion, a swindle. There is no crisis. It is artificially created by the ECB and the banks and governments. It can be solved immediately by changing the liquidity rules to include governments.
The euro zone could switch over to the Chinese way of printing money without creating debt and enjoy a similar boom.
There is nothing to be gained by allowing this Ponzi scheme to continue. The ECB’s bluff should be called. Let it cut ff liquidity – and pay the political price, which will be the end of the ECB and the banker puppet masters.
It is unacceptable for the people of Europe to be looted by the ECB and a criminal underbelly in governments.
Is this what Europe is all about? Oppression under the bankers? Open looting and the jackboot?
Are the tanks going to be sent in to mow millions down?
The time is rapidly approaching when all of Europe will be engulfed in civil war. And there will not be enough tanks in the world to contain the anger of the people when the ECB and their politicians loot their last euro on behalf of the bankers.
Look at the anger Spain. Look at the anger in Ireland. Look at the anger in Greece.
The people have had enough.
They want a return to law and order. They want sound money and an end to the looting by bankers and complicit politicians, the finance ministers, central bankers.
The time to act is now. Greece has to go into default. If the ECB cuts off liquidity, then the chiefs are removed pending trial and the operational rules changed to reboot the liquidity including liquidity to governments.
The solution is crystal clear and very simple. All that is lacking is the political will.
We, the people, have the will to end this looting.
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