News & Analysis
G7 Is Concerned About Euro Collapse ... Sure They Are!
G7 to hold emergency euro zone talks, Spain top concern ... Finance chiefs of the Group of Seven leading industrialised powers will hold emergency talks on the euro zone debt crisis today. G7 finance ministers concerned about risks in euro zone ... The talks are a sign of heightened global alarm about the threat posed by strains inside the 17-nation monetary union. Financial markets are anxious about the risks from a Spanish banking crisis and fret a Greek election on June 17 could lead Athens to leave the euro and precipitate more economic turbulence. "We have reached a point where we need to have a common understanding about the problems we are facing," Japanese Finance Minister Jun Azumi said. – RTE News
Dominant Social Theme: The G7 is correct to be concerned.
Free-Market Analysis: The Earth is falling and the Eurozone is wobbling. Brussels is worried, Germany is intransigent and Washington is "concerned."
The proximate cause of these worried brows is a dysfunctional continent-wide union that had no reason to exist, no popular mandate to expand and no certainty that what is occurring now shall not repeat again, in one form or another, in the future.
As we've pointed out before, the EU is a blossoming fascist state with little direct democracy, a judicial system verging on the Napoleonic Code (guilty until prove innocent), an expanding Euro-army and a determination to wiretap, chip and generally track individuals throughout the continent.
It is this nascent authoritarian nightmare that the US and the G7 are "concerned" about. A union that has brought bloodshed, agony and bankruptcy to its entire southern flank; a monetary union that now needs a political union to ensure its survival.
This is surely a power elite dominant social theme. One can see the gears grinding as this promotion lurches along. The elites want to run the world and they frighten people into going along by using fear-based memes.
The EU's collapse is a perfect example of this theme. From our point of view, increasingly, this entire affair was orchestrated by those who are now "concerned" about the matter. The top elite families apparently control central banks around the world and it is child's play to involve their distribution arms (commercial banks) in a lending operation that causes a sovereign crisis.
Convenient, no? We're not supposed to ask why so many banks lent to obviously insolvent borrowers like Greece, Spain and Portugal.
We are not supposed to ask why top bankers who disburse central banking did not understand the consequences of it. We are not supposed to ask why these same top money men – surely most of them with decades of experience – did not understand the booms and inevitable busts of fiat money.
We are not supposed to ask why Ben Bernanke could have comprehended the 1930s depression as an outcome of monopoly fiat money but the top men in commercial banking today apparently have little or no understanding of the history of their profession.
These are the titans of industry and finance. These are the brightest and best that the world has to offer. Like children, they blunder ahead through good times and bad, never seeming to notice that the system they labor under crashes catastrophically ever decade or so.
And now the G7 is "concerned." Here's some more from the article:
Earlier, Canadian Finance Minister Jim Flaherty said ministers and central bankers of the US, Canada, Japan, Britain, Germany, France and Italy would hold a special conference call, raising pressure on the Europeans to act. Toronto and Washington both called for more action. "Markets remain sceptical that the measures taken thus far are sufficient to secure the recovery in Europe and remove the risk that the crisis will deepen," White House press secretary Jay Carney told reporters.
In a sign of increasing concern about the euro area's debt crisis, Australia's central bank cut interest rates today by 25 basis points to 3.5%, the lowest level in two years. It cited further weakening in Europe and a deterioration in market sentiment. Pressure is building in particular on Germany, the European Union's paymaster, to back away from its prescription of fiscal austerity for the region's weaker economies and to work harder on fostering short-term growth.
A G7 source familiar with plans for the calll said the group would urge more progress at an EU summit on June 28-29, though this alone would probably disappoint global markets. Asian stocks rallied today on hopes for the G7's intervention. The euro extended gains to a one-week high. But there was only a very small chance the G7 would go so far as to pledge coordinated action to curb excessive volatility in currency markets, the source added.
Japan, for one, fears a strong yen, which has been a safe haven for investors during the euro zone crisis, could help tip its economy into recession. The G7 could also call for concerted action at the upcoming summit of the wider Group of 20 major economies in Mexico on June 18-19, the source said. The G20, which includes China, played a prominent role during the 2008-2009 financial crisis.
A G20 official in Asia said the grouping, which also includes Brazil and India, could look to put pressure on Germany to switch to stimulus mode, as part of a wider call for strong, developed economies to step up spending. "Germany and Canada could be seen as those having fiscal capabilities among the advanced economies," the official said.
One can see the tumblers clicking into place as if the current crisis were a Yale lock. First, the sovereign crisis and then the "markets" grown concerned. Not all at once, mind you. The crisis affects only one country at a time.
And does anyone stop and think – as we have pointed out previously – who makes up these markets? The FX market is the provenance of the world's LARGEST banks, all of them doubtless controlled by the same group that runs the world's public/private monopoly central banks.
We are supposed to believe that this market is entirely divorced from the larger control of Money Power. Where do people think the money comes from that these banks are using? It comes from the printing presses of central banks.
Yet the idea is presented, absurdly, that there is a "crisis" rolling merrily along that is out of the control of the very money men that print the currency that those provoking the crisis are using.
Now it is said that Germany's austerity idea must give way to "growth." But the only entity capable of providing growth via monetary expansion is the European Central Bank (and associated entities and instrumentalities).
Germany's Chancellor Angela Merkel replies predictably that there must be a further political union before an enhanced monetary one. The G7 meets to voice its concern and urge that the leaders of the EU do whatever is necessary to ameliorate the crisis.
Click ... click ... click ... The tumblers fall into place.
There is no conversation about allowing the EU to break apart and resume commerce with its component pieces. The only solution is yet more centralization – of the kind that has brought the EU to its current pass.
Conclusion: It is hard to avoid the conclusion that we are watching a kind of directed history. Money Power, having determined that it will have its union in Europe (and elsewhere as well) is now using a phony crisis to present the logical solution of yet more centralized power.