The World today – is Euro-zone crashing?

A new reality or a powerful scarecrow to push forward some new ‘principles’ within the EU?

Fear and the euro
by Gavin Hewitt (BBC’s Europe editor) | 16:22 UK time, Tuesday, 16 November 2010

You can sense the alarm in today’s comments by European Council President Herman Van Rompuy. He called it a “survival crisis“.

He urged: “We must all work together in order to survive with the eurozone, because if we do not survive with the eurozone, we will not survive with the EU.”

It is, of course, a debatable point. But this was a threat: that the Irish debt crisis could bring down the whole EU. This stark message was intended to scare states and leaders into coming up with answers.

In Germany, Angela Merkel too has been playing on fears.

The German chancellor said: “I’m telling you, everything is at stake. If the euro fails, then Europe will fail. And with it fails the idea of European values and unity.”

It is hard to know whether Mrs Merkel believes this to be literally true.
But her intention was also clear: to rattle those within her own party and elsewhere in Germany who are in increasing numbers beginning to question the point of the European Union.

The focus of the current crisis remains Ireland.

What is happening is that Ireland is being told to accept some kind of rescue for the good of the euro. That is one option, but it would amount to Ireland surrendering financial independence. “There’s no reason why we should trigger an IMF or an EU-type bail-out,” said the Irish Europe Minister, Dick Roche. Ministers genuinely believe they have a strategy that can work. They want time to deliver their budget on 7 December.

Now in these fractious times all kinds of people are insisting they are not putting pressure on the Irish. The European Commission, for one, says its hands are clean.
Fingers point at the European Central Bank (ECB). They deny it too. Only the Portuguese and the Spanish are openly leaning on Dublin.

The Portuguese say they are suffering from higher borrowing costs because of doubts over Irish debt. They say they might be pushed into asking for a bail-out. The Spanish Treasury Secretary, Carlos Ocana, pressed Ireland to come to a resolution quickly to end market uncertainty.

The biggest concern is the domino effects – that Portugal won’t be able to raise sufficient funds because of the cost of borrowing. If Portugal had to be bailed out the markets might question whether Spain could service its own debt, considering it has almost zero growth. The EU’s bail-out mechanism may be able to handle the debts of Greece, Ireland and Portugal, but Spain would be altogether a different matter.

1 thought on “The World today – is Euro-zone crashing?

  1. The Eurozone sovereign debt shocks and US Quantative Easing have light the fuse for Götterdämmerung

    I relate that the May 2010 EU Finance Ministers’ Summit announced a sacrifice of national sovereignty to preserve the integrity of the Euro. The Leaders’ announcement established a unified economic, political, fiscal, monetary and seigniorage cash aid package for Greece.

    Now that assistance appears to be in peril, and the risk of sovereign debt default, and of failed national Treasury auctions, as well as rising interest rates for both corporations and governments looms large. And the risk of substantial competitive currency devaluation, at the hands of currency traders is intensifying by the day.

    Ambrose Evans Pritchard in a recent Telegraph article, used the word “Götterdämmerung“, a particularly apt word, to describe the apparent fatal wound to the world’s financial, economic and political systems which is coming soon, as bond traders continue calling interest rates higher, such as the US mortgage rates, and the Interest Rate on the US Government 30 Year US Treasury bond and the Interest Rate on Portugal, Italy, Ireland, Greece And Spain sovereign debt; and as currency traders continue a global sell off of the world’s currencies, as both conduct a war for sovereignty against the world central bankers and world leaders.

    God was gracious to provide Revelation 13:3, which reveals that the soon coming apparent fatal wound to the world’s economic and political systems will be healed.

    But that it will come at the cost of the rise to power of a world Sovereign and also a world Seignior, the latter comes from Old English and means top dog banker who takes a cut.

    Out of the coming investment “flame out”, a global leader and a global banker will rise to establish order: a Sovereign and a Seignior will ascend to govern the world.

    According to bible prophecy, their word, will and way will be the law of the land superseding constitutional law and traditional rule of law that comes with national sovereignty.

    Perhaps Herman Van Rompuy will rise to be The Sovereign as the Afteramerica website relates that he has called for global governance: nation states are dead … The EU chief relates the belief that countries can stand alone, is a ‘lie and an illusion!’

    And perhaps Tony Blair, because of his business connections, will rise to be The Seignior.

    Or perhaps the Seignior will be Olli Rehn, one known for calling for calm as related by Ambrose Evans Pritchard in article Telegraph article Greek Rescue Frays as Irish Crisis Drags On.

    And yet again, The Seignior might be the co-chair of the Council on Foreign Relations, the CFR, Robert Rubin, who was US Treasury Secretary during the Greenspan era as related by The New York Times.

    All seigniorage will come and go through The Seignior: all sovereign wealth funds, and banks will report to him, as there will be unified regulation of banking globally as referred to, in the James Politi and Gillian Tett Financial Times article, NY Fed Chief Timothy Geithner In Push For Global Bank Framework

    Soon there will be no national seigniorage anywhere as sovereign debt interest rates will explode to the point where there will be no buyers.

    This is already the case for Portugal, Italy, Ireland, Greece and Spain, as they have lost their seigniorage authority. Their fiscal needs are provided for by the ECB which buys their bond issues, as well as debt from their banks. The ECB is the sole lender to these nations. Currently the ECB is The European Seignior.

    Sovereign nations and their constitutions will be history, as principles of global governance working through regional economic and security pacts and leaders’ agreements will serve as the basis for regional currencies or a global currency.

    The Seignior’s financial and economic power will complement the military and political power of the Sovereign; and between the two they own the world “lock, stock and barrel”

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