It’s the greatest Greek tragedy since Oedipus Rex. Except in this case, the only incest occurs between bankers and politicians.
We’re broke. So in reality we borrowed $780 million from China to give to Greece which has no hope of ever repaying it. If there’s any rational thought in that sequence of events it totally escapes us.
The IMF is delighted to announce that it just approved a €3.2 billion disbursement of cash for Greece, its fifth, as part of the €12 billion in money that Greece needs in order to continue operating in the months f July and August. And just for what purpose will this money be used, one may ask?
Well, as explained a few weeks ago, in Greek Math: €12 Billion In, €18.2 Billion Out the entire amount will be promptly recycled by global financial institutions in the form of debt maturities and interest payments, which amount to €18.2 billion in the months of July and August. Simply said ECB, EU and IMF money in, money owed to bankers out. The kicker: 17.09% of the money coming from the IMF, comes from, that’s right dear US taxpayer, you (and since 21% of the quota contributions allocated to the IMF are deemed “non-usable”, the actual number funded by the US is likely much higher).
But this plot has a bonus kicker: as we reported on Wednesday, the actual Greek debt is no longer owed by European banks to the extent it had been previously expected: a development that threatens to scuttle the entire second Greek bailout plan as currently proposed.
So as the banks have been selling Greek debt, who has been buying? Mostly hedge funds, such as everyone’s favorite John Paulson. So to recap: US taxpayers have just paid out about $780 million of the $4.6 billion in order to fund interest owed to… hedge funds.
On second thought, there is sex involved in this Greek tragedy. Unfortunately, it’s the American taxpayer that’s getting screwed.
The Greeks are not happy that they’re being asked to live within their means. In fact, as far as they are concerned, such a request is tantamount to torture.
Debtocracy is a documentary that gives Greek artists and activists – two groups never known for their attachment to reality – the chance to say that the bailout is a scam designed punish the Greek people in order to protect French and German banks.
Pity the poor Greeks, forced to work until the age of 50 and then expected to scrape by on their meager $100,000 a year pensions while their German counterparts continue working into their dotage to make it all possible.
Torture, indeed.
Here’s the entire 75-minute documentary, complete with English subtitles.
Remember the old Dire Straits song “Money For Nothin’”? I think it should become the official Greek national anthem.
As you can see in this chart, the Greek Parliament is dominated by socialists, communists and other leftists who seem to think it’s possible for every Greek citizen to get their money for nothing’. No word on whether they also get their chicks for free, but we wouldn’t be surprised.
Maggie Thatcher said, “The problem with socialism is that you eventually run out of other people’s money.” In this case, the money Greece is running out of is French and German.
PIMCO has an unparalleled record predicting bond movements. They didn’t get to be the world’s largest bond fund by being wrong.
Mohamed El-Erain, PIMCO’s Chief Executive, is now predicting that Greece will be the first, but definitely not the last, European to attempt to solve its problems by default on its debts.
CNBC reveals El-Erain’s thinking:
“For the next three years, we’re going to see different economies work out different problems. For European economies, especially Greece, it would be through default,” Mohamed El-Erian, chief executive of PIMCO, told reporters in Taipei on Wednesday via a video conference.
This isn’t the first time El-Erian has predicted that Greece would default. He thinks the other European nations (read: Germany) are pounding billions down a rat hole by putting more money into the wastrel nation.
And on an even less cheerful note, El-Erain said it was “unlikely but not impossible” that a Greek default would trigger another global financial crisis.
Listen carefully to what El-Erain says. Betting against him and Bill Gross is not a wise investment strategy.
The EU’s inability to control the Greek debt situation (“situation” being a euphemism for “crisis”) is sending tremors through the world’s currency and equities markets.
Problem is, the world’s markets fear that the Greek debt problems may spread to other countries. For example, Moody’s has already hinted that it may downgrade BNP Paribas SA and two other large French banks as a result of their exposure in Greece.
“The probability of a eurozone Lehman moment is increasing,” said Neil Mackinnon, an economist at VTB Capital in London and a former U.K. Treasury official.
Today’s forecast: Early morning doom followed by gloom. Bill Gross, the guy known as the Warren Buffett of bonds, the guy who runs PIMCO, the world’s largest collection of bond funds, says the United States is worse off than Greece.
Add it all up, says Gross, and it ain’t a pretty picture: The $14.3 trillion national debt. Medicare. Medicaid. Social Security. A few other trifles. Next thing you know, we owe close to $50 trillion. Add in liabilities from the 2008 and 2009 bailout and what do we have?
We paraphrase. That’s not quite how the President worded his offer to bail out the Greeks, but that sums it up in language that’s been stripped of all the political gobbledygook.
CNBC reports on the President’s generous offer to bail out the Greeks by digging our own hole a little deeper:
Greece has spent itself right up to the edge of the abyss, yet Greeks don’t want to give up their cushy jobs, extravagant perks and early retirements. No, they think that someone else should continue to pay so that they can continue to play.
Now they’re protesting in the streets to protect their lives of leisure, but we’re pretty sure that none of the protesters were willing to protest any harder than they work:
You know how you sometimes see an event unfolding in what seems to be slow motion and yet you remain frozen in place and unable to react? That’s exactly how the EU is now reacting to the Greek fiscal fiasco.
Unlike its recently deposed leader, the International Monetary Fund is impotent. They’re pretty sure something needs to be done but no one agrees on what. So the Eurocrats have worked up a dandy selection of equally unworkable plans.
Do you remember when the housing decline first appeared on the radar screen a few years ago, and all the “experts” told us that it would be contained to certain states? Then, when the subprime loan crisis hit, these same experts told us that the it would be contained to only subprime loans. Later, when Lehman fell, the experts again told us the banking problems would be contained as well.
The “experts” are once again dead wrong on another issue about to be “uncontained.” Now we’re being told that the Eurozone sovereign debt issues will be contained to the problem countries like Greece, Portugal and Ireland. Not only will Europe as a whole be just fine and dandy in the end, but so will the United States (which is quickly becoming a synonym for Greece).
Endgame author John Mauldlin, one of my favorite reads on Europe’s problems, begs to differ. Here he is in this video with Aaron Task of The Daily Ticker.
Alex Jones has a message for Greece, and you can hear it in this video of an interview of Jones on Russia Today. He pleads with the Greeks to remove their government of thugs and take back their nation.
Don’t get bored by the first minute and stop the video. The interview begins around 1:10.
Here’s the majority of the “message” he is sending to Greece, roughly transcribed:
You have a puppet government engaged in treason against the nation of Greece. And Greece is being financially captured, through economic conquest, and you must take back your entire government, and remove the gangster thugs at every level of your government who have been aiding this tyranny. Because when you give in to this tyranny, it will destroy you. And things are only going to get worse unless the Greek people take back their nation. The whole world is looking at what is happening in Greece right now. Just like 300, like what happened in Marathon, if you can hold back the banking dictatorship here, it will literally save the entire planet from a designed global depression and implosion. So Greece is the tip of the spear, on the front lines for western civilization that is fighting the private banks that openly say they want an end to the the industrialized society, they want to bring in a program of austerity and a new dark ages with a fake environmental, neo-feudalistic carbon tax overlay. This is high-tech scientific slavery and we have all the globalist documents. Greece is the test case, if Greece falls to this it is a great victory for the enemy. So Greece, I’m sorry you are in this position, but you are on the very front lines…
Hot on the heels of the riots in Italy yesterday, comes Greece again, where hundreds of protesters clashed with riot police across central Athens, smashing cars and hurling gasoline bombs during a nationwide labor protest against the government’s latest austerity measures. The former Minister for Development Kostis Hatzidakis was attacked by protesters outside a luxury hotel. He was escorted, bleeding from the scene as his attackers yelled “thieves” at him.
I have a question: why aren’t the police shooting as they get firebombs hurled at them? At least rubber bullets would be warranted. I have no sympathy for the Greeks. The government overspent and the people, who get to retire at 57 by the way, dodged paying their taxes more than any other western country. Whiners.
You heard leader of the UK Independence Party Nigel Farage’s wonderful rant against the Euro on the floor at the English Parliament. Now, listen to him interviewed by RT, about the Eurozone’s bailout troubles. Another Eurozone country, Italy, might need a financial bailout soon. The third largest economy that uses the Euro currency has started plunging in the same direction as Greece and Ireland, who he says couild be kicked out of the Eurozone. It comes as fresh protests sweep across Europe — with people angry at facing tough cuts to pay for it all.
Pimco’s CEO Mohamed El-Erian is one of the brightest guys around. In this video he comments on the Irish bailout, telling viewers on CNBC that the Eurozone has not met the first rule of crisis management: get ahead of the crisis; be seen as proactive, rather than reactive. He says “as long as they are being reactive, they are going to have a slow motion wreck going on in Europe and we are going to wake up and it’s going to be a new country that you are talking about.”
He calls the order of the problematic countries, following Greece and Ireland, as Portugal, Spain, Belgium, Italy.
Listen to the whole interview to hear his recommendations for navigating the coming devastation.
worn: No Lauren, it is you who sounds uninformed. After reading your reply, I am wondering if you are aware that the worst natural disaster in U.S. history was the Galveston hurricane of 1900. Yes, that’s the hurricane in which 6,000-12,000 people died due to a storm surge on the Texas...
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James: After a seriously obese person has had fat removal procedures, his/her flesh sags where excess fat used to be. World population should never have risen this high. It will be reduced. Through lower birth rates; or by more traditional means: war, disease, famine, cannabalism. I’m not a...
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Kim: Marcy, Rep. Alan Grayson said in the attached youtube video in 2010 that Fannie Mae and Freddie Mac both own stock in MERS. How much stock and when did they own it? Would this explain their current actions? Did they move loans out of MERS and into Fannie Mae for the tax payers to bail out?...
bon: How silly you folks do not realize that it’s the “in thing” to hate Americans now. I’m poor. I’m poor because of greed and graft in light of my honesty in addition to self-serving and selfish Americans who continue to deplete their brains of the genuine cause of...
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R. Arthur Beckles: Barack Obama is President of all Americans, not just of African-Americans! It’s difficult for all working class Americans – black, white, brown, etc. African-Americans who don’t want to vote for Obama, can feel free to do so. But do they think that their lot...
EriktheRed: I like how it’s “fortunate that the crisis is confined to the E.U.”- what’s unemployment in the U.S. right now? How about the millions of foreclosures you’ve had already? Tent cities, anyone? Deficit spending at $3.5 bn a DAY? HMM!
David, Self Defense Retailer: Really? Why in the world are they doing that for Gitmo detainees? A whole soccer field? Outrageous! Maybe the EU really won’t last.
David, Stun Gun Supplier: It’s the next bubble. I wonder what Romney has to say about this. Obama’s made himself clear in his typical way. It’ll probably be worse than housing when it does.
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JoAnn: I have a real problem with Obama borrowing money to send to Greece when so many people in this country who have lost long term jobs,lost homes,living on the street, little or no food. I vote to take Obama and his family if they want to go and DROP them on a desert island some where just so...
Arkansas Slim: Update. Oil hit 105 per barrel yesterday, 2 20 12. Gas US Avg => 3.50 per gallon. Cloward Piven Theory of Economics: Tipping point of US Electorate => 51%. Nevada odds for Obama RE Election 6/10 on thier sport boards. EU/Greece set to collapse, dominos arranged. Socialistic...
kkl: America is now turning mediocre no more fun no more trips or vacations 100 bucks to fill gas tank and pasta and ramen noodles for life for usa there is no more hope no more fun just work go home work go home fill up gas tank eat shit and work no more fun thanks for nothing nobama i hope you...
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Matt USA: I know I’m a little late to this discussion, but I think that the economic collapse scenario has changed somewhat in recent weeks. It appears that Europe will go first, followed by the United States who has gambled and lost on a TARP style European bailout. The real question for...
China: @Serban Enache , You Are Wrong We are In Lot Of Trouble and you Know This , Starting In 2012 We will have Many Many Different Problems , We The Government Is Paying For All This Building , We Know Our Own Citizens Can’t Afford This Type Of Live Style , but we are building it Any way...
Rider I: How the US has historically used mineral rushes to get it out of Deficits and stop foreign economic take over. In the US’s historical past the Druids have used and impressed upon the US leadership to use mineral resources to stop economic warfare, along with military take over....
