ECB President Mario Draghi cuts the euro's last lifeline … Anyone thinking that the arrival of Mario Draghi as president of the European Central Bank might herald a change in approach to the eurozone debt crisis would have been sadly disappointed by his first public appearance in the new role on Thursday. True enough, he did cut interest rates, but this was already part of a pre-written script and can be easily justified by what Mr Draghi referred to as "slow growth, heading towards mild recession". No, and a thousand times no, he said to those calling on the ECB to stem the crisis with massive purchases of periphery-nation debt. The ECB's function, he reiterated, was to focus exclusively on price stability, not to act as lender of last resort to governments. Already, he seems like a clone of his predecessor, Jean-Claude Trichet, who famously had only "one needle in his compass" – inflation. Regrettably, it was this very same anti-inflationary zeal that is likely to have sealed the eurozone's fate in slipping into "mild recession." … The idea of a "mild recession" is also a contradiction in terms; recessions are never mild. – UK Telegraph
Dominant Social Theme: The European Central Bank will do what it needs to do. It is an inflation fighter.
Free-Market Analysis: This is a big dominant social theme of the power elite – that central banks fight inflation. Central banks CREATE inflation by printing money from nothing. But the elite promotion is orchestrated to avoid that reality.
Over and over, you'll see good, gray central bankers dressed in expensive suits stepping up to a bank of microphones to enunciate their concern over "inflation." They don't mean inflation, of course, which is monetary. They mean PRICE inflation. Meanwhile the printing presses churn behind them.
Inflation is monetary. The more currency you print, the more inflation you are creating – and sooner or later it translates into PRICE inflation. As the volume of money grows, the value of currency lessens. It's an ineluctable fact. Here's some more from the article:
The ECB's position is a mass of contradictions. The ECB has already intervened quite heavily in sovereign bond markets, to the disgust of German council members, two of whom have resigned over the issue. But on this too Mr Draghi is sticking to the sophistry of his predecessor's justification. The purchases are temporary, limited and justified by monetary policy considerations, he insisted …
Insurrection against the penalties of the single currency is by no means confined to Greece. Berlusconi appears as much dead in the water as Papandreou. Greece doesn't matter; the eurozone economy could cope with a hard Greek default … But Italy, the eurozone's third largest economy as well as the world's third largest sovereign bond market, is a different matter.
The euro could not survive an Italian default and/or exit. Things are falling apart with a speed which G20 leaders cossetted in Cannes seem powerless to prevent … Denied both growth and ECB activism, there is very little chance of the eurozone periphery meeting its commitments. Subjugation of democratic rights to the demands of the centre, meanwhile, risks a vicious political backlash …
Not until the debt crisis spreads to the core, threatening the single currency as a whole, could he be persuaded. This is a crisis that is set to run and run, locking in the now near certainty of another Continental recession which the UK will be lucky to escape.
The article also makes the point that Draghi has cut interest rates, which help Europe's drowning banks even as he refuses to buy the debt of Europe's bankrupt PIGS – Portugal, Italy, Greece, Spain, etc. What the article does not point out, but we will, is that this is a policy that is deliberately driving the EU toward generic insolvency or worse – a break-up. The banks will be the proverbial last man standing.
This conforms to our presentment that the powers-that-be may have decided the EU is impossible to rescue as it is now. The half-century experiment at empire building is over. The charade will continue but where it really counts, in the area of monetary policy, the EU and the euro will be undermined.
Why would the elites and their great central banking families do such a thing? Well, to impose maximum chaos on the world in order to introduce yet more centralized authority. This authority can evolve worldwide or perhaps it can be imposed directly on the EU, or what's left of it.
There are those who believe that this was the plan from the beginning. We are not so sure. We tend to believe that the Anglosphere elite has determined that the EU is best utilized now to generate maximum chaos and we would be surprised if that is not the result.