Michael Snyder, Contributing Writer
Activist Post

What in the world is going on in Europe?  Each day things just seem to get stranger and stranger.  We are being told that a “deal” for a second Greek bailout has been reached and that Greece will not default in March. 

But behind the scenes it seems clear that many politicians in Germany (and in the other northern European countries as well) would like to kick Greece out of the euro.

So what exactly is happening here?  Well, it is complicated.  The United States, along with other members of the international community, put a tremendous amount of pressure on Germany to bail out Greece one more time.  Germany does not want to look like the bad guy, so they are going along with this bailout, but they are also imposing conditions on Greece this time that will be almost impossible to meet.  And when Greece fails to meet its “obligations”, that will give the northern Europeans the excuse that they need to kick Greece out of the euro.

At this point, many politicians in northern Europe are convinced that Greece is a “lost cause” and that it is not fair to ask northern European nations to pay the price for the financial mistakes of Greece.

Greece is basically completely and totally bankrupt, and the nations of northern Europe don’t want to have a “financial dependent” on their books forever.  They are looking for a “way out”, and this new agreement lays the foundation for that.

Right now, Greece is experiencing depression-like conditions.  The following description of what life is like in Athens these days is from a recent Daily Mail article:

What is so shockingly evident as you walk around Athens are the awful parallels between that war-time era and today. The soup kitchens, the beggars, the pensioners picking up discarded vegetables after street markets close, the homeless scavenging for food in bins. These are the signs that can be seen.

Less noticeable is the quiet desperation of dignified people who turn off heating despite the cold and share dwindling savings with jobless relatives. Or the workers unable to afford fares home and the children fainting in school from hunger.

Greece is an economic basket case at this juncture, and many northern Europeans are not keen on the idea of endlessly supporting Greece financially.

The way that the other nations of Europe have been torturing Greece makes it clear that their patience is running out.  The outrageous austerity demands that the EU and the IMF made on Greece this time were so oppressive that many believed that Greece would never agree to them.  It was thought that Greece might finally be forced out of the euro.

But the current Greek government desperately wants to stay in the eurozone and the Greek Parliament did agree to them.

Unfortunately for the Greek government, they are going to be watched much more closely this time.  In essence, they will be under the microscope.  If they slip up, and they almost certainly will, that will give those that wish to abandon Greece the ammunition that they need.

The decision seems to have been made that Greece is going to be made to exit the eurozone one way or another.  Esteemed financial journalist Ambrose Evans-Pritchard penned the following in one of his recent columns:

It is clear that Berlin, Helsinki, and the Hague have taken the decision to eject Greece from the euro whatever the country now does. Even if Greece complies to the letter with the impossible terms of the EU-IMF Troika, it will not make any difference. A fresh pretext will be found.

The tension in Europe is so thick right now that you could almost cut it with a knife.  Some northern European politicians have clearly had enough.

-Luxembourg Finance Minister Luc Frieden is trying to make it sound like Greece is kicking itself out of the eurozone:

If a member state says, ‘we prefer not to take money from other states and return to a national currency without making structural reforms,’ then that state has chosen to exclude itself.

-German Finance Minister Wolfgang Schäuble is openly proclaiming that he does not believe that it is even possible for the Greek government to comply with all of the demands that the EU and the IMF will now be imposing upon it.

-Bavaria’s finance minister Markus Söder is very clear about what he thinks should be done….

It would be better if Greece stepped out of the euro.

But it is not just politicians that think it would be best for Greece to exit the euro.  According to one recent poll, 57 percent of all German business leaders want Greece to leave the eurozone.

The upcoming national elections in Greece that are scheduled in April could end up being a significant turning point.

There is a lot of fear in northern Europe that the next Greek election will be dominated by the far left and that will result in a complete breakdown of the austerity process and all the money spent trying to keep Greece in the eurozone will have been wasted.  One member of Greek Parliament recently said what he believes may happen after the upcoming election….

If we achieve a Left-dominated government, we will politely tell the Troika to leave the country, and we may need to discuss an orderly return to the Drachma.

There have been persistent rumors that some European countries have been planning for the worst.  For example, a recent article in The Telegraph actually claimed that Germany is currently drawing up contingency plans for the exit of Greece from the eurozone:

Plans for Greece to default, potentially leaving the euro, have been drafted in Germany as the European Union begins to face up to the fact that Greek debt is spiraling out of control – with or without a second bailout.

A number of politicians in Greece realize what is going on and have lashed out angrily.  Greek Finance Minister Evangelos Venizelos is absolutely convinced that there are forces in Europe that are trying to push his nation out of the eurozone.  He recently made the following statement:

In the euro area, there are plenty who don’t want us anymore. There are some playing with fire, domestically and abroad. Some are playing with torches and some are playing with matches. But the risk is equally great.

One member of the Greek Parliament, Kostas Kiltidis, is warning of dire consequences for those trying to kick Greece out of the euro:

We are the cradle of European civilization and nobody can take us out of our own home. There is no legal mechanism for this. If they try, others are going to die economically with us.

All over the financial world, there is a growing feeling that a Greek default is inevitable at this point.  Just check out the following quote from a recent report put out by Credit Suisse:

Overall, we are left with a sense that the probability of delivering the largest default loss in history in a disorderly way on or before 20 March has increased relative to doing so in an orderly way. (Our view remains that, in any case, the chance of a disorderly outcome  after 20 March is high, so to that extent the immediate events are not really central to our view, but of course are fascinating).

The Greek government is drowning in debt and is going to great lengths to try to stay afloat.  In Greece today, it seems like almost everything that the government owns is for sale.  The following is from a recent article in The Independent:

The Greek government is trying to raise a staggering €50bn from the sale or rental of national assets including Athens International Airport (and 38 other airports), state oil and gas companies, ports in Thessaloniki and Piraeus, the Hellenic Post Bank, the motorways, the state-run horseracing organisation, and 35 large government-owned buildings. Hellenikon – a strip of coastline three times larger than Monaco which was once home to an international airport – is up for grabs, as is a 44-acre chunk of Corfu and, reportedly, numerous other stretches of scenic coastline.

But no matter what the Greek government does, it is only delaying the inevitable.

This new deal is not going to “save” Greece.  Government debt will remain at unsustainable levels and the country will be facing depression-like conditions for years and years to come.

Many Greek citizens are planning for the worst.  The following comes from a recent article in The Guardian….

‘I’m really worried. I think there is a risk that we will go bankrupt and I’ve thought a lot about being prepared,’ said Dimitra Partheniou, 61, in Athens. ‘I’ve gone through all the scenarios: of there being no food, of people being attacked as they go to the supermarket, of banks being looted. And I’ve decided that if that happens we’re moving to Poros [an island] because there, at least, we’ve got enough land to cultivate tomatoes and corn.’

When people become desperate they do desperate things.  For example, it was recently discovered that thieves have stolen dozens of priceless antiquities from the Ancient Olympia Museum.  As the economy continues to crumble, things in Greece are going to get even worse.

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And northern Europe does not intend to be financially responsible for this Greek tragedy.

So don’t be fooled by this new deal.

This deal is not about rescuing Greece. Rather, it is about setting the stage for the exit of Greece from the euro.

And if Greece does end up getting kicked out of the eurozone, that is going to be a signal to the financial world that others may be asked to leave the eurozone at some point as well.

Investors would be left wondering which country will be the next to go.

Portugal? Italy? Spain?

The economic problems that Europe is facing right now are not going to end with Greece.

Some European officials seem to think that if they “amputate” by cutting off Greece right now that the rest of the eurozone can be salvaged.

That simply is not going to happen.

In the end, Europe is either going to totally break apart, or it is going to integrate on a level never seen before in modern times.

It will be fascinating to see what happens.

RELATED ACTIVIST POST ARTICLE: 
International Currencies Increasingly Rejected in the Face of Inflation

This article first appeared here at the American Dream.  Michael Snyder is a writer, speaker and activist who writes and edits his own blogs The American Dream and Economic Collapse Blog. Follow him on Twitter here.

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Stephen Lendman, Contributing Writer
Activist Post

Greece is being systematically raped, pillaged and destroyed. Bankers demand it. What they want, they get, no matter the human toll and economic ruin. 

Standing armies pale by comparison. Financial oligarchs wage war by other means and take no prisoners. Greece is Exhibit A. More on it below.

Last July, Christine Lagarde became IMF managing director. She replaced Dominique Strauss-Kahn. Spurious attempted rape allegations forced him out. In fact, he was targeted for supporting more responsible IMF policies. Bankers wanted his head and got it.

Lagarde’s mandate is making IMF policy meaner and tougher. Straightaway, she backed the harsh austerity measures banks demand. They include debt peonage and forcing nations to place money master interests above sovereign ones.

Last November, Mario Draghi replaced Jean-Claude Trichet as ECB president. Like Largarde, his mandate also entails raping and pillaging nations to pay bankers.

In late February, he told Wall Street Journal interviewers that forced austerity is firm policy. Enforcing it he claims will return troubled economies to long-term prosperity. In other words, starving people fills bellies. Withholding treatment cures patients, and destroying villages save them.

Journal interviewers never asked him to explain:

• what right have bankers to prioritize their demands over sovereign state needs;


• how can ritual sacrifice increase demand; and 


• how can 17 dissimilar economies coexist under straightjacket Eurozone rules.

Instead, they unquestioningly accepted his assertions about needed austerity and ending Europe’s “obsolete” social contract.

“There is no feasible trade-off” between social and labor related structural changes and fiscal belt-tightening, he claimed. Only banker demands matter. Draghi and Lagarge enforce them. Corrupt politicians go along.

In a recent talk, Michael Hudson said:

Welcome to the post-industrial economy, financialized style. Industrial capitalism has passed (through) a series of stages of finance capitalism from the Bubble Economy to the Negative Equity stage, foreclosure time, debt deflation, austerity – and what looks like debt peonage in Europe, above all for the PIIGS: Portugal, Ireland, Italy, Greece and Spain.

Latvia, Estonia and Lithuania were also raped and pillaged. Debt bondage forced large numbers to leave or starve. EU nations perhaps await the same fate. Forced debt deflation, foreclosures, unemployment and poverty’s driving them all toward eventual third world status.

Perhaps mighty Germany will succumb. With fewer customers to fuel exports and weaker domestic demand, it’s economic miracle may melt and become mirage.

Look at Japan. Its post-bubble economy became rolling recessions, weak recoveries, decline, deflation, and stagnation for over two decades.

Europe is already in recession. Austerity and rising oil prices assure greater trouble. Yet consensus thinks EU nations will muddle through. Liquidity infusions prioritize speculation and market manipulation at the expense of economic needs.

Solutions, explained Hudson, require central banks to “monetize government budget deficits so as to spend money into (economies) to promote economic growth and full employment.”

It is not rocket science; it is common sense, and when done responsibly works as intended. Yet, neoliberal policy makers and major media scoundrels suppress workable remedies to assure bankers, other corporate favorites and rich elites get paid, at the expense of the other 99%.

Western society schools teach junk, not responsible, economics. It prioritizes financial oligarchy demands over policies fostering sustainable economic growth. When ignored, economic decline, democratic and social erosion, unemployment, poverty, and debt peonage follow.

A Historic Analogue

Current policies assure the rich get richer. The rest suffer. In Western societies, where more deeply than Greece. It’s banker occupied. Ordinary people have no say. They’re burdened by multiple austerity rounds similar to crushing German Treaty of Versailles reparations.

Fascism under Hitler emerged. WWII followed. Versailles terms were outrageous. In May 1921, Germany got an ultimatum — accept terms in six days or face industrial Ruhr Valley military occupation. With no choice, it accepted.

Moreover, colonial possessions and raw material resources were seized. In the end, both sides lost out. Unmanageable debt overwhelmed world finance and monetary policy by 1929. Wall Street’s crash followed.

An unsustainable pyramid was built on punitive war debts. Wall Street and other major banks enforced payments. They exceeded America’s annual 1920s foreign trade. Rebuilding and modernizing war-torn Europe was sacrificed to pay bankers.

Germany got the worst of it. Its Reichsbank had to print enormous amounts of money to survive. Catastrophic hyperinflation followed. In January 1923, the mark dropped to 18,000 to the dollar. By July, it was 353,000, in August 4,620,000, and by November an astonishing 4,200,000,000,000.

It became worthless. German savings were destroyed, and calamitous events became inevitable.

Lost assets compounded economic misery. Germany’s colonies became League of Nations Mandates. Alsace-Lorraine, West Prussia, Upper Silesia and other territories were ceded to Britain, France, Belgium, Czechoslovakia, and Poland.

Gone were agricultural resources, 75% of Germany’s iron ore, 68% of zinc ore, 26% of coal, as well as Alsatian textile industries and potash mines. In addition, Germany’s entire merchant fleet was taken, a portion of its transport and fishing fleet, plus locomotives, railroad cars and trucks to pay war debts.

Impossible terms demanded 132 billion gold marks at 6% annual interest. As a result, inflation soared. German industrial activity plunged. Reichsbank and other German bank assets were seized. Marks became worthless. Public anger grew. Communism and fascism vied for power.

In 1923, a so-called Dawes Plan (named for US banker Charles Dawes) was adopted. Paying bankers was prioritized. Looting was enforced. It continued until 1929 when the debt pyramid collapsed.

A banking crisis followed. So did capital flight. Germany’s economy crashed. Depression emerged. Hard times empowered radical political elements.

The rest is history. WWII left 40 million dead and Europe in ruins. In other words, when public pain exceeds thresholds of no return, all bets are off. Often the unthinkable happens.

Europe in Crisis 

Today, angry millions across Europe face destitution, neo-serfdom, despair, and no future. Greece is its epicenter. Multiple bailouts enforce banker pillage. Austerity assures they’re paid at the expense of economic solvency and public need.

Even the neoliberal New York Times noted a “Greek Tragedy,” saying:

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It’s “chok(ing) on Europe’s conditions. (The) approach will not work.” Greece can’t possibly repay debt. The more added, the greater the burden, the less ability to service and repay.

“By forcing all Greeks to suffer with no real prospects of relief, Europe is uniting the country, now beset by strikes, against further reforms.” Politicians face “political suicide in this spring’s elections” if, in fact, they’re held or unless populist candidates are excluded.

A Final Comment 

Zombie Greece awaits burial. The latest bailout deal may be the last. Greece’s debt burden already is double the reported amount.

Eventual default is certain. So is exiting the Eurozone. Expect it perhaps later this year. Markets already discounted it. Perhaps other countries will follow.

Progressive Radio New Hour regular, Bob Chapman, suggested even Germany may exit, saying:

“Germans are fed up with subsidizing others and want to go ahead on their own. They never wanted” Eurozone membership in the first place. Moreover, by boycotting Iranian oil, EU nations are shooting themselves in the foot. Long-term, disruptions may follow, intensifying economic disaster and public anger.

Already it’s raging on and off in Greece, Spain, Italy, Britain, and elsewhere across Europe. Chapman thinks a military coup may follow. EU solidarity and confidence are gone. “Bureaucrats and politicians have let fraud go on far, far too long.”

What can’t go on forever, won’t. No one knows when, but it’s just a matter of time.

Stephen Lendman lives in Chicago and can be reached at lendmanstephen@sbcglobal.net.

Also visit his blog site at sjlendman.blogspot.com and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening.

http://www.progressiveradionetwork.com/the-progressive-news-hour/

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Stephen Lendman, Contributing Writer
Activist Post

European/American austerity assures a 1% wealth grab at the expense of all others. 

Prioritizing banker payments causes debt bondage, human misery, economic wreckage, and eventual collapse. What can’t go on forever, won’t. It’s not rocket science; it’s fact.

Economies thrive on productive economic growth. It includes public sector infrastructure investment in transportation, research and development, roads and bridges, education, healthcare, and other vital areas. Sacrificing it for bankers and other vulture investors causes Greek-type crises.

Financialization highlights “the great problem of our time,” says Michael Hudson. He defines is as “capitalizing every form of surplus income and pledging it for bank loans at the going interest rate, personal income over and above basic expenditures, corporate income over and above cash flow….and whatever government can collect in taxes over and above its outlay.”

Banker nirvana depends on securing all economic surplus as interest, says Hudson, or in hard times as bailouts. However, doing it “leaves nothing over for living standards and what (18th and 19th century) economists (called) human capital formation (training and education) required for labor productivity to rise.” Economies need it to thrive.

There’s also “no cash left over for corporations to invest in new tangible capital formation, and no government spending for infrastructure or other social and economic needs.”

Hudson talks about a financialization-caused economic/political “Dark Age,” “a form of neo-feudalism.” Industrial capitalism and people suffer to enrich financial oligarchs. Austerity becomes policy. Debt peonage and hard times follow. Jobs are cut, wages slashed, and living standards shrink. Prioritized banker demands sacrifice fundamental human needs.

EU Fiscal Pact Insanity

The EU’s latest Fiscal Pact demands more. Terms call for constitutional debt limits. Exceeding 3% of GDP brings European Court suits. Doing so triggers automatic penalties, at least according to pact mandates.

Eurozone monetary union failed. Europe’s Exchange Rate Mechanism (ERM) was introduced as part of the European Monetary System (EMS) to propel the continent to one European currency unit (ECU).

ERM never worked. ECU’s failing. At issue is duplicity, conflicts of interest, and uniting 17 dissimilar countries under rigid euro straightjacket rules. Doing so usurps their monetary and fiscal autonomy disastrously. 

Bernard Connolly got it right. His 1995 book titled, The Rotten Heart of Europe: The Dirty War for Europe’s Money called it a harebrained idea doomed to fail, saying it cost him his job as EU monetary affairs department head. He’s regarded as the foremost expert on European economic, monetary, and political integration.

Months before the euro’s 1998 introduction, he predicted that one or more of Europe’s weakest countries would face rising budget deficits, troubled economies, and a “downward spiral from which there is no escape unaided. When that happens, the country concerned will be faced with a risk of sovereign default.”

In late 2007, the great unraveling began. Massive liquidity infusions delay eventual day of reckoning inevitability. The longer it is extended, the worse the fall. It’s just a matter of time.

New Fiscal Pact provisions mandate austerity. EU nations have no say. Ordinary people have none whatsoever. Britain and Czechoslovakia opted out, not for populist reasons. Under the Bank of England, the UK retains monetary sovereignty. Both countries retain fiscal policy control.

They’ll enforce austerity their own way. Mandating more across Europe assures harder than ever hard times. Ordinary people suffer most. Recession’s already biting. Europe’s healthiest economy feels it. Germany’s 2011 Q IV GDP contracted 0.25%. In January, its retail sales slumped 1.6%. Consensus expected +0.5%. Eurozone industrial activity contracted for the seventh consecutive month.

China’s Purchasing Managers Index (PMI) showed weakness. Its growth target was cut to 7.5% from 8%. High oil prices are taking a toll. US gasoline consumption slumped 7% year-over-year. Imagine the effect of expected $5 dollar gas by summer or late spring. Real, not manipulated, joblessness keeps growing.

What affects Germany impacts the continent. Look for Europe’s recession to deepen and spread. Unemployment’s rising. In January, it reached double digits, its highest level since the euro was introduced.

Youth joblessness is especially affected. In Greece and Spain it’s 50% or higher. Fiscal Fact austerity assures greater hardship, including higher unemployment, lower wages, eroded benefits, and less ability to survive. Mandating it is cruel and insane.

Decades of social progress is lost. Ordinary people more than ever are on their own to sink or swim. In the hardest hit countries, people are voting with their feet and leaving. Capital flight’s joining them. Fiscal Pact madness assures economic decline, widespread deprivation, and social unrest.

At the same time, ECB Long Term Refinancing Operation policy (LTRO) gives banks free money, but not without unintended consequences. Expect eventual disruptive public anger. Deprived people take only so much. Tolerance thresholds eventually breach. The fullness of time will tell when.

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For years, Progressive Radio New Hours hour regular, Bob Chapman, explained Eurozone madness and eventual Greek default. He calls the last four years “a warm up” for greater future trouble.

Greece, other troubled economies, and those heading there can’t keep borrowing more than their revenue stream. Doing so increases indebtedness. Extraordinary levels can’t be repaid. Entrapped Greece has no choice but to default and exit euro straightjacket rules.

S & P cut Greece’s credit rating to selective default, its lowest level because repaying it is impossible. Moreover, European banks won’t lend to each other. Speculation’s safer. Unless business lending increases, economic growth won’t happen.

So far, not a glimmer’s in sight. Free ECB money achieves Pyrrhic victories at the expense of ultimate unwinnable ones. Follow bond, not equity, buyers. Their world view sees dark storm clouds coming. Bet on it.

Stephen Lendman lives in Chicago and can be reached at lendmanstephen@sbcglobal.net.

Also visit his blog site at sjlendman.blogspot.com and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening.

http://www.progressiveradionetwork.com/the-progressive-news-hour/

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Erik Colin Charles, Contributor
Activist Post

If you know somebody in Greece, please reach out to them and have them read this article and post a comment if they agree or disagree.

Westerners, please write Greek politicians and reference the article — what happens in Greece affects everyone, so we need to root for each others’ success rather than simply say ‘Not in My Backyard’.

The world knows that you feel the pressures and despair of this economic crisis to the middle of your bones. The crushing blow of austerity makes you feel helpless and weak, but there are solutions ….

1) Do not kill yourselves! Don’t you dare take your lives. That is what the banking elitist vampires want you to do. Yes, that’s right, there is a belief among the central banking elitists called eugenics. Eugenics is the belief that we, the regular people of the world, are “useless eaters” and serve no purpose unless we can serve the needs of the elitist rich. Hitler, Stalin, Mao held the same beliefs and moved to apply this philosophy through mass murder. Please research this for yourselves and you will see that the very people who call for Greece to take on severe austerity believe in this unholy philosophy and are working to put more tanks and military forces on the streets. They will keep cutting services until there is nothing left to cut. By killing yourselves, you are making the wish of the elites for total domination and depopulation that much easier. You must live to continue to be a thorn in their sides. You have a right to life; if anybody, it is they who should commit suicide.

2) The “Debt” is not yours! Do you trust central bankers? Do you believe they are honest? Central bankers have openly admitted that they created Credit Default Swaps and used your nation as a front to commit fraud on a massive scale. A Credit Default Swap is similar to selling a car to 100 different people and promising them that they alone will be able to drive that car, but not telling them that the car is actually stolen. Bankers have used the Greek people as their mule, so that they could commit crimes around the world and whip the Greek people into submission by convincing your government that you owed the debts that THEY created! These same bankers have made claims on your lottery, your infrastructure, your water, and even your islands and have exclaimed that they were now the just owners of these things. Exchanging fraudulent digital non-money for real tangible assets. This is the biggest crime of the century – which brings us to point number three.

3) The proceeds of these financial crimes must immediately be given back to the Greek people. The Greek assets taken can ONLY belong to the Greek people. They cannot be sold/swapped/traded into the hands of criminals. Unfortunately, there have been some sons and daughters of Greece that have helped to perpetrate these crimes against her, acting like a Trojan horse. There are a few amongst you that have acted insidiously and worked to remove sovereignty from the Greek people. All those involved in this fraud have already caused so much damage to Greece and her people that they must immediately face trial, then life sentences and possibly even the death penalty. The Greek people are victims in this scenario and the real offenders of this situation must be brought to justice. The Greek people must decide what the fate of these criminals should be and decide what the punishment is for high treason. The proceeds of these crimes (the tangible assets of Greece) must be given back to the people of Greece and this will solve some of the economic problems Greece faces in the immediate future.

4) This is the most important point and the most difficult to understand. During this time of crisis, Greece has a unique opportunity to become one the most free and wealthy nations in modern times. Right now, some of you reading will be shaking your heads, but I must ask you to reserve judgment.

Across the Western world, governments are increasingly restricting free speech and ideas. Small business owners, entrepreneurs and inventors are being punished by Western governments who will not let them engage in business, invent new products, new technologies or express themselves freely.

When an entrepreneur starts a business, there are layers upon layers of bureaucratic fascist red tape that prevent such a business from even beginning. Specialized predators – or as you might commonly refer to them: lawyers – often seek to destroy small businesses to protect the interest of the corporate behemoths they work for.

It is well documented that Western governments will not offer contracts to small local businesses (see asbl.com for evidence), rather only to mega-corporations that lobby these very governments for closed no-bid contracts.

These contracts are bloated and ridiculous; a famous example is the $800 toilet seat purchased from a super mega-corporation that provides supplies to the U.S. army.

There are numerous agencies in the U.S. formed to assault free-thinkers and purge their creativity: IRS, CIA, FBI, DOJ, DOD, any and all alphabet-soup organizations – never once offering to aid the individual, only exacting punishments on the very people that could serve their nation best.

Sometimes these agencies operate under the guise of protecting the public, such as the Food and Drug Administration, recently making it a criminal act in the U.S. to drink fresh unpasteurized farm milk. This is, of course, paralleled or even instigated by the Eurocrats in Brussels who wish to make exhaling carbon dioxide an environmental crime.

What people across the world really crave is freedom. Not the kind of freedom where people wrap themselves in the flag of their respective country and congratulate themselves for being born. Real freedom where artists, entrepreneurs, inventors, and scientists have the freedom to create great things without being attacked for their ideas. Some places have had a fleeting glimpse of freedom throughout history. Think of Paris in the 1920s with Picasso, Gertrude Stein, Hemingway. Think of turn of the century America, with great inventors like Thomas Edison or Nikola Tesla.

These times are quite a contrast with the era of WWII or our present time. In many ways the invention of the Internet has been a great equalizer. An individual or a small company can leverage their position and compete against a large mega-corporation by offering their services or products in the same venue.

That is the reason that the predators of free thought and creativity wish to see the Internet’s ruin. U.S. Bills like SOPA and CISPA have sought to criminalize the individual who uses the Internet to engage in business, or perhaps mildly criticize the powers that be. The attacks have become so tyrannical that many technologies and businesses that would benefit mankind have been suppressed to never see the light of day.

The establishment tries to convince the public, through mainstream news and dramas that the “law” must be upheld at all times and at all costs, that the “law” is there to protect the public and keep us safe. This would be great if it was applied equally to everyone. But anyone with two brain cells can tell you that that is not the case. Executives, Bankers, Celebrities, and Billionaires are usually quite adept at circumventing any punishment from the crimes that they perpetuate.

Often the “law”, created by “Officials” and “Bureaucrats” does not take what is right or wrong into consideration. Take elections, for example. This is not a political expression – as I care not for politicians, whom for the most part are pathological liars and kleptocrats. I hope for the best with the outcome of the election, but my prediction is that Greece will receive more of the same. Often, seemingly political opponents are agents for the very same cause. A prime example of this is George W. Bush and Obama; they appeared on the surface to be very different, but if you now analyze their decisions and actions, they are virtually indistinguishable.

The heart of the problem remains with the un-elected European Union and its “Officials” who wish to eat out your substance. These “Officials” can pass resolutions and laws, but keep in mind that even though they may declare something a law or illegal, the terms of ” legal” and “illegal” are irrelevant when compared to what is “right” or “wrong”. Hitler passed several laws and resolutions to carry out genocide “legally”. In the United States, the Supreme Court even once declared that black people were not “legally” people. They can make any laws they wish, but there are some universal truths that no “law” can touch.

You have RIGHTS! The Greek people (like people everywhere) have a right to life, have a right to earn a decent living, and have a right not to have an illegal debt put on their backs. The EU, the troika, the Central Banks have thrown Greece into despair and have attempted to demoralize the youth of the nation. You will often hear “experts” and “economists” try to discount Greece as a nation with no resources to create products or manufacture wealth. You must forget about the speculators and the “banking experts”. They have wished for the demise of Greece for years. The rest of the world hopes to see Greece succeed … and there is a way.

Greece may not have a lot of physical resources, but that does not matter so much in the modern world. What is desired more than any other thing on the planet is individual freedom. The individual freedom to know, to say, to do, to be. Greece is the birthplace of many great minds. The destiny of Greece is to once again ignite its reputation as the ‘intellectual capital of the world.’ Greece should sell freedom to the rest of the world. Since there is no competition, Greece can set its own price. The demand for freedom will never wane and if the governments of the Western world continue to follow their self-destructive paths, Freedom will continually be in scarce supply. What do I mean by selling freedom?

First, create a ‘Freedom Zone’ for all Internet services, activities, servers, domain registration, virtualized tools, publishing, etc. to the entire world. In this ‘Freedom Zone’, the Internet would be free and protected from any agency, corporation, litigant, or bureaucrat that wishes to shut it down. The idea is to be able to express oneself fully without any government intervention against criticism. Let the Freedom of Speech reign over your beautiful country. Opponents of free speech argue that it can be dangerous and they often give the example of yelling “Fire!” in a crowded movie theater.

On the Internet, life is virtual – so any harm would be virtual or non-real as well. Bureaucrats have tried to convince the public of the dangers of “online terrorism”. This is ridiculous because systems such as power grids or water treatment facilities should not be accessible over the regular Internet in the first place.

This small act alone could create massive financial gain for Greece, as small companies, artists, musicians, inventors, etc. would flock to use Greek Internet Systems, which parallels the spread of the Greek idea of Democracy over 2000 years ago.

Second, offer three-year ‘intellectual visas’ to the top minds in the world. Because the world and the global market is an increasingly dangerous place for intellectuals, they are actively seeking refuge from totalitarians who would squash their free speech, steal their ideas and shut down their businesses.

Freedom is the most valuable commodity in the world right now, and continually seems more scarce. If you adopt a visa system that allows intellectuals from Western nations to come into Greece , you’ll see  your country’s wealth flourish.

I would encourage you to charge a nominal visa application fee of $7,000 USD per person, and have the applicants pledge 1/10 of their time to volunteering, where their respective talents can benefit your nation. If you accept say 200,000 participants, that is $1.4 Billion USD. I’m sure this money could be put to good use and is urgently needed.

Don’t you dare give one cent of this money to pay the bankers the fraudulent debts you do not owe; please give it to Greeks in the most dire of need instead. By implementing this program, Greece will have the brightest minds in the world actively working to solve your nation’s problems like food production, energy trading, manufacturing, etc.

Some other stipulations could be that the visa participants must also sign a loyalty pledge to work toward the good of the Greek people, not incur any debts, and obey the local laws of Greece. Charge a 15% flat tax on the intellectual visa participants. Whatever capital they are able to make from their art, inventions, products, businesses, they will gladly share 15%. The amount generated by this tax could be the most lucrative. Men who are free to create without chains, are often the most successful.

Greece could also offer economic citizenship with investments over $1M USD (or some other amount). The countries who have offered economic citizenship programs in the past have flourished and amassed fortunes in their coffers. Today, very few countries even offer these types of programs. I assure you that even with all the problems in Greece, there are numerous wealthy individuals who would give all their passports up to become a citizen of your beautiful nation.

You may say, “We the Greek people are concerned with survival, why would we care about immigrants who want to come to Greece?”

As the frontline, you are in great danger of even stiffer measures to make sure you comply with greater austerity. How much further can they go? There are no limits. Billy clubs, tanks and even gas chambers are in the realm of possibilities. You must change to survive. The criminals in charge must be brought to justice immediately; it is either them or the Greek people who will suffer. The intellectuals of the world cast our vote with you, the people. There is no future siding with financial terrorists, which is what banks, technocrats, and politicians have become. Foreigners will also boost your local economies through tourism, by renting apartments, supporting your local restaurants and those who produce goods and services. I’m sure this boost is greatly needed at this moment.

In the information age, intellectual capital is the only weapon that can be used to keep the criminal elites at bay by exposing their corruption. If Greece becomes the defender of free speech and the hub of intellectual and informational technology, this is the only non-violent method to turn around a dire economic situation. You must act, and you must act now. I, alone, do not have all the answers and cannot guarantee that there will not be difficult situations if you aggressively take on these ideas. However, if you do not, you will face debt slavery to the same bastards who have beat your country into submission. They will not give you any quarter; that much is guaranteed.

Third, You must promote open source technology and open source intellectual property to be shared among all Greeks. Your young should not have to pay for university; all knowledge should be open source and readily available for any Greek citizen who wishes to take advantage of it. Every Greek child could be taught open source software for free – since there is no licensing required. The intellectual visa participants could be assigned to classes of youth and should be encouraged to teach these skills for free. In 5-10 years these children could be experts in open source software and lead the world in software production. This software could be used for the management and production of Sovereign Greek Energy. This is just one example of many that could transform Greece. Open source inventions, Open Source products, tools, could all be created and shared with the Greek people and future R&D projects.

You must promote the idea of Greece as a center for intellectual freedom. This kind of freedom generates wealth, attracts the best minds to your country, and will continue to enrich your country for many years to come.

Your ancestors built ancient civilizations; it is your destiny to continue to build civilization and push the limits of science and innovation. Protect freedom like a precious jewel. It is the secret to wealth.

The nations who have sought to protect individual freedom have become the wealthiest on earth. Unfortunately, they have abandoned freedom and with this, we are witnessing their decay. Greece can become a bastion of freedom and an economic powerhouse at the same time.

Recent legislation by massive corporations have tried to clamp down on what people can say and do on the Internet. The Internet has become such a vital part of our everyday life.

Greece should not allow anyone to peer into their records or give information to policing bodies that wish to extradite individuals or subpoena businesses. This firm stance against tyrannical forces will attract all those with liberty in their minds, and all productive humans who love humanity, and consequently also love liberty.

This direction of Liberty will also spawn further creative capital from the arts. Greece could become the hub for media and of the performing arts. Every young Greek has an incredible opportunity to use this crisis to their advantage and create intellectual capital that will bring wealth to Greece from around the world.

Before Greece gets started on this path it must totally divorce itself with the use of the Euro. The technocrats will try to convince you that this is futile and that you cannot survive a return to the drachma, while they continue to pile even more debt upon your nation and stomp on your throats. A lot of you may be anxious about doing this, but the reality is that the Euro is moving towards worthlessness.

Greece may feel some financial pain in the short term, but the end result of sticking with the Eurocrats is increasing austerity, more police tactics, and a total loss of sovereignty. Greece can save herself with a national currency backing its own sovereign money and forget listening to Eurocrats who have never ran a business successfully in their life. Greek people have a right to determine their own fate without being tied to the Titanic that is the Euro-zone. You must get rid of the Eurocratic/EU system and rid this trash from your beautiful country. They are vampires set on drinking the life-blood of Greece.

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Greece must refuse to pay for all Credit Default Swaps and falsified debts that have been created by foreign banksters and wrongly put on your backs. Take back all national assets that belong to the Greek people and commandeer the assets of the bankers that have tried to steal from you. Remove their titles of ownership to these Greek assets, as they can only truly belong to the Greek people and nobody else.

AN IMPORTANT MESSAGE TO THE GREEK POLICE:

You must stop abusing your brothers and sisters for the interests of foreign bankers at once! We see the beatings of old ladies and men, the hungry, and the tired bruised by your batons. Why have you sold out your nation and abused your office? To fight the Greek people? To fight your brothers and sisters for a salary of a few euros that will be worthless in a couple of years?  It is absurdity! How will your mother ever love you or respect you when you hurt the children of Greece? Remember the lessons of history. Hitler, Stalin, Mao Zedong all exterminated their police forces as their first order of business when their regimes came fully to power. If you continue along this path you have no future other than the death of your nation and your brothers and sisters.

Now you may agree with my suggestions and say, “But what can we do? We have no power…”

Nonsense. If you had no power, they would not send a militarized police force to intimidate you. Keep living as if these austerity measures were pure fiction. You must take advantage of the benevolence of those who wish to aid your nation. Do not put your trust in gigantic foreign corporations or governments, but in the individual. Open your doors to those who wish to build the Greek nation and close your doors to those who wish to tear it down. The rest of the world hopes to see Greece rise. Trade with your neighbors who support you. Iceland was able to rid herself of the foreign banking sociopaths and is doing better than ever. Trade with Iceland, and you will find that the natural resources you lack can be supplemented with the resources that Iceland offers.

Greece does not so much have an economic crisis, as it has a crisis of will power. Whose Will will dominate? The banking vultures who push you towards suicide and laugh at your misery, or the will of the Greek people whose ancestors gave birth to Western civilization, fought tirelessly to preserve their sovereignty and have the power within each and every one of its citizen to overcome your enemies and rise like a phoenix above the ashes?

You know the answer. It is up to you. They want you to feel helpless and at the mercy of their institutions, but what they are really afraid of is that you will discover the enormous power and potential within yourself.

Your voice and your will is stronger than any weapon. Your destiny is truly what you choose it to be.

Spread your wings and fly to victory.

Greece Will Prevail.

Erik Colin Charles has lived and worked overseas and is passionate about free markets, intellectual freedom, free speech, and taking action.  Please visit his dedication to Greece, with additional photos and images (in English and Greek) at The Greek Solution

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Tony Cartalucci, Contributor
Activist Post

Editor’s Note: For more information, please read “Farmers group wants Ireland to follow Iceland and burn the bondholders.”

Across the dominion of the corporate-financiers on Wall Street and in the city of London, the reckless Ponzi schemes destroying the West’s economy and plunging it into an economic depression have left politicians, the bought-and-paid-for servants of corporate-financier hegemony, wringing the public dry to cover losses. In reality, when an enterprise fails because of criminality, incompetence or both, citizens should not be forced to pass the hat around to “bail them out.”

They are declared bankrupt, their assets (if they have any) are stripped, often if fraud is involved, executives and board members go to jail, and society attempts to fill the void with sounder enterprises run by more reputable people.

Now, however, when the fraud and failure unfolds amongst the highest levels of corporate-financier power, amongst men who have organized wars that have sent millions to their deaths, overseen social “projects” that have left hundreds of thousands of women forcibly sterilized; instead of going to jail, these criminals are showered with self-aggrandizing awards from institutions of their own creation. This faux-authority, faux-legitimacy has left the people subjected to their machinations with the illusion that they must pay for, heed, follow whatever solutions are then prescribed by the very elite who created the problem in the first place.

Indeed, if we want this current system to continue – it would be wise to follow their instructions to the letter. However, if we are unsatisfied with this system, it is important to not only protest these unjust measures, to refuse absolutely to abide by any of their edicts, but to create and promote our own programs to put society back on the rails of progress.

Video: Max Keiser discusses a possible push-back by the Irish people against debt that isn’t theirs.

Iceland was one of the first nations during the latest round of global financier manipulation to say “no.” The bankers created the problem, Icelanders said, so the bankers will pay for it, not the Icelandic people. Ireland has followed suit – in the face of a draconian, neo-feudal “house tax” leveled against the Irish – essentially forcing people to pay for the “privilege” of living on their own land. The Irish have overwhelming refused to pay it. While it may be “illegal” to say no to the neo-feudal house tax, paid to corporate-financiers who apparently see themselves as neo-lords, it is certainly not wrong. It is wrong, in fact, to heed unjust laws created by self-serving minorities at the expense ($130 USD per home) of the majority.

The Irish have followed this noble defiance with a campaign – predictably muted by a willfully ignorant international media – called “Farmers For No.” Farmers for No is an organization that is precisely what is needed – not austerity measures – but grassroots organizing and cooperation at a local level, to solve local economic woes, with local solutions. Farmers for No is currently campaigning to follow Iceland’s example and vote no against austerity, and instead default on loans the Irish people are already being demanded to pay for, but loans they are in no way responsible for.

While Farmers for No is fighting its battle “far off” on the Emerald Isle, their fight is our fight. Whether you live in Greece, Spain, France, or England, across the sea in the United States, or in Asia – which is currently pursuing the same sort of financier consolidation, directed by Wall Street and London, and leading to the very sort of catastrophic meltdown the West has just experienced, Farmers for No’s battle is yours.

Video: Dr. Webster Tarpley explains how banker debt bailouts are not the responsibility of sovereign states. For more analysis by Dr. Tarpley, visit Tarpley.net.

Next, Farmers for No, and grassroots organizations around the financially-wrecked Western world, must begin devising, promoting, and implementing pragmatic programs of their own – after making it clear they will not accept such programs to be decided for them by the very people, criminals even, who created the problem in the first place.While we may differ in opinions as to what we should do, any program truly devised by the people and for the people will be preferable to anything devised by Wall Street, London, and other Western financiers gravitating toward their orbit. Most likely a synergy between local free market and national investments in production, real education, and infrastructure would be best. Additionally, taxing (with a Tobin tax) the banks themselves to bailout nations from monolithic and ever-increasing debt, should be considered in lieu of wringing dry the populations of the West with austerity.

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However, whatever your opinion may be, nothing will happen so long as you sit on the sidelines, or worst yet, continue patronizing the corporations and banks behind economic, foreign, or domestic policies you disagree with. We must begin to organize ourselves, begin promoting and implementing our own ideas on a local level, leveraging technology to do so, and stop waiting for a “buffet of palatable options” to be spread out before us by the very criminals that have historically exploited, misled, and plundered our society for generations.

Tony Cartalucci’s articles have appeared on many alternative media websites, including his own at Land Destroyer Report.   Read other contributed articles by Tony Cartalucci here.

Please assist in this grassroots effort to deny power to the global banking cartel.  Spread awareness by voting on Reddit HERE

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Michael Snyder, Contributor
Activist Post

The bank runs that we are watching right now in Greece are shocking, but they are only just the beginning. Since May 6th, nearly one billion dollars has been withdrawn from Greek banks. For a small nation like Greece, that is an absolutely catastrophic number. At this point, the entire Greek banking system is in danger of collapsing.

If you had money in a Greek bank, why wouldn’t you pull it out? If Greece leaves the euro, all euros in Greek banks will likely be converted to drachmas, and the value of those drachmas will almost certainly decline dramatically. In fact, it has been estimated that Greek citizens could see the value of their bank accounts decline by up to 50 percent if Greece leaves the euro. So if you had money in a Greek bank, it would only make sense to withdraw it and move it to another country as quickly as possible. And as the eurozone begins to unravel, this is a scenario that we are going to see play out in country after country. 

As member nations leave the eurozone, you would be a fool to have your euros in Italian banks or Spanish banks when you could have them in German banks instead. So the bank runs that are happening in Greece right now are only a preview of things to come. Before this crisis is over we are going to see bank runs happening all over Europe.

If Greece leaves the euro, the consequences are likely to be quite messy. Those that are promoting the idea that a “Grexit” can be done in an orderly fashion are not being particularly honest. The following is from a recent article in the Independent….

‘Whoever tells you a Greek exit would be no big deal is an idiot, lying or disingenuous,’ said Sony Kapoor of the European think-tank Re-Define. Economists fear that a disorderly exit would prompt a huge run by investors on Spanish and Italian debt, forcing those countries to seek support from an EU bailout fund, which, with a capacity of just €500bn, is widely regarded as too small to cope with those pressures.

A Greek exit from the euro would not only result in a run on Spanish and Italian bonds, but it would also likely result in a run on Spanish and Italian banks.

If Greece is allowed to leave the euro, that will be a signal that other countries will eventually be allowed to leave as well. Nobody in their right mind would want their euros stuck in Spanish or Italian banks if those countries end up converting back to national currencies.

Fear is a powerful motivator. If Greece converts their euros back to drachmas, that will be a clear signal that all euros are not created equally. The race to move money into German banks will accelerate dramatically.

And a Greek exit from the euro is looking more likely with each passing day. Even the IMF is now admitting that it is a very real possibility….

Christine Lagarde, head of the IMF, warned she was ‘technically prepared for anything’ and said the utmost effort must be made to ensure any Greek exit was orderly. The effect was likely to be ‘quite messy’ with risks to growth, trade and financial markets. ‘It is something that would be extremely expensive and would pose great risks but it is part of options that we must technically consider,’ she said.

Meanwhile, banks in other troubled European nations are already on shaky ground. The Spanish banking system is an absolute disaster zone at this point and on Monday night Moody’s downgraded the credit ratings of 26 Italian banks.

The situation in Italy is especially worth keeping a close eye on. As Ambrose Evans-Pritchard recently noted, things are not looking good for Italy at all….

Italy’s former premier Romano Prodi said the EU risks instant contagion to Spain, Italy, and France if Greece leaves. ‘The whole house of cards will come down’, he said 

Angelo Drusiani from Banca Albertini said the only way to avert catstrophe is to convert the European Central Bank into a lender of last resort. Otherwise Italy faces “massive devaluation, three to five years of hyperinflation, and unbearable unemployment.”

So what can be done about any of this?

Well, there is actually a lot that could be done if politicians in Europe were willing to think outside of the established global financial paradigm.

The truth is that Greece could solve their current financial problems in four easy steps. They would have to be willing to stick it to the rest of Europe and to risk being blackballed by the international community, but it could be done.

The following is my prescription for Greece….

1. Default on all debts.


2. Leave the euro.


3. Issue drachmas that are debt-free and that do not come from a central bank. Instead, have the Greek government create them and spend them directly into circulation.


4. Enjoy a return to prosperity.

In such a scenario, the Greek national debt would no longer be a problem, the Greek government would never have to borrow any more money and austerity would no longer be needed.

Yes, inflation would be an issue with the new currency, but a bit of inflation would be a walk in the park compared to the horrible economic depression that Greece is experiencing right now.

And once the Greek economy was growing again, it would certainly be possible for them to make the transition to “hard money” if they wanted to.

It is imperative that we all understand that just because the global financial system works a certain way today does not mean that it must always work that way.

If you have a few minutes, I want you to watch an incredible speech by a 12-year-old Canadian girl named Victoria Grant. In this 6 minute speech, she details how the bankers are defrauding the people of Canada and how the Canadian government does not actually need to borrow a single penny from the bankers….

If a 12-year-old girl can figure this out, then why can’t the rest of us?

Sadly, the financial world still seems enamored with the corrupt central banking system that has gotten us into this mess. In fact, one recent poll found that Federal Reserve Chairman Ben Bernanke has a 75 percent approval rating from global investors.

Right now, America is going down the same path as Greece, Spain and Italy have gone. Eventually we will hit a wall and our financial system will fall apart.

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We need the American people to understand that the Federal Reserve system is a perpetual debt machine. The U.S. national debt is now more than 5000 times larger than it was when the Fed was first created. It is at the very core of our national financial problems.

When will people wake up and realize that central banking is the problem and not the solution?

When will people wake up and realize that national governments do not have to go into debt to anyone if they do not want to?

In our world today, there is far more debt than there is money.

It is a system that will inevitably crash.

But there are other alternatives.

Unfortunately, politicians all over the globe continue to want to be married to our current debt-based financial system.

As a result, we will suffer the consequences of that system.

This article first appeared here at the Economic Collapse.  Michael Snyder is a writer, speaker and activist who writes and edits his own blogs The American Dream and Economic Collapse Blog. Follow him on Twitter here.

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Michael Snyder, Contributor
Activist Post

Money is being pulled out of Greek banks at an alarming rate, and if something dramatic is not done quickly Greek banks are going to start dropping like flies. As I detailed yesterday, people do not want to be stuck with euros in Greek banks when Greece leaves the euro and converts back to the drachma. 

The fear is that all existing euros in Greek banks would be converted over to drachmas which would then rapidly lose value after the transition. So right now euros are being pulled out of Greek banks at a staggering pace. According to MSNBC, Greeks withdrew $894 million from Greek banks on Monday alone and a similar amount was withdrawn on Tuesday. But this is just an acceleration of a trend that has been going on for a couple of years. It has been reported that approximately a third of all Greek bank deposits were withdrawn between January 2010 and March 2012.

So where has all of the cash for these withdrawals been coming from? Well, the European Central Bank has been providing liquidity for Greek banks, but on Tuesday it was reported that the ECB is going to stop providing liquidity to some Greek banks. It was not announced which Greek banks are being cut off. For now, the Greek Central Bank will continue to provide euros to those banks, but the Greek Central Bank will not be able to funnel euros into insolvent banks indefinitely. This is a major move by the European Central Bank, and it is going to shake confidence in the Greek banking system even more.

There are already rumors that the Greek government is considering placing limits on bank withdrawals, and many Greeks will be tempted to go grab their money while they still can.

Once strict currency controls are put in place, the population is likely to respond very angrily. If people can’t get their money there is no telling what they might do.

We are reaching a critical moment. Many fear that a full-blown “bank panic” could happen at any time. The following is from a recent Forbes article….

The pressing problem isn’t a splintered legislature that may balk at delivering the reforms that the IMF and European Community are demanding in exchange for the next tranche of bailout money. It’s a disastrous, old-fashioned run-on-the bank. ‘For a year, Greeks have been sending their savings from Greek banks to foreign banks,’ says Robert Aliber, retired professor of international economics from the University of Chicago. ‘Now, the flood has reached a crescendo.’ Indeed on Monday alone, outflows from the Greek banks reached almost $900 million.

These banks would have collapsed already if not for the support of the European Central Bank and the Greek Central Bank. This was described in a recent blog post by Paul Krugman of the New York Times….

But where are the euros coming from? Basically, banks are borrowing them from the Greek central bank, which in turn must borrow them from the European Central Bank. The question then becomes how far the ECB is willing to go here; is it willing, in effect, to lend enough money to buy up the entire balance sheet of the Greek banking sector, given the likelihood that this sector will be left insolvent by Greek default?

Yet if the ECB says no more, Greek banks stop operating — and it’s hard to see how they can be restored to operation except by ditching the euro and using something else.

That is why the announcement on Tuesday was so dramatic. The ECB is starting to pull back and that is a very bad sign for the Greek banking system.

For the moment, the Greek Central Bank is continuing to support the Greek banks that the European Central Bank is no longer providing liquidity for. A Reuters article explained how this works….

The ECB only conducts its refinancing operations with solvent banks. Banks which fail to meet strict ECB rules but are deemed solvent by the national central bank (NCB) concerned can nonetheless go to their NCB for emergency liquidity assistance (ELA).

But this emergency liquidity assistance is not intended to be a long-term solution as a recent Wall Street Journal article noted….

The ECB’s emergency-lending facility isn’t intended as a long-term fix. National central banks must get approval each month that they want to let their banks access the facility from the ECB’s governing council, which can veto use of the program.

If Greece installs an antibailout government that reneges on its austerity promises, it would almost certainly be cut off from ECB funding.

The truth is that we are heading for a financial tragedy in Greece. If the flow of money out of Greek banks intensifies, the Greek banking system might not even be able to make it to the next election in June. This point was underscored in an article that was published on Tuesday that was authored by renowned financial journalist Ambrose Evans-Pritchard….

Steen Jakobsen from Danske Bank said outflows are becoming unstoppable, not helped by open talk in EU circles of ‘technical’ plans for Greek withdrawal. 

‘This has a self-fulfilling prophecy built into it and I don’t think we can get to June. The fuse is burning and the only two options now are a controlled explosion where Germany steps in to ensure an orderly exit, or an uncontrolled explosion,’ he said.

So what should we expect to see next?

Well, James Carney of CNBC says that he believes that it is inevitable that Greece is going to have to implement currency controls in order to slow the bleeding….

It looks increasingly likely that Greece will have to implement controls to prevent capital flight and a banking collapse. To my mind, the only real question is when this will occur.

The widespread talk about Greece possibly leaving the euro zone is likely to trigger withdrawal of bank deposits and other financial assets, by those who fear they might be redenominated into a drachma that would be worth far less than the euro.

The Greek government may soon announce a limit on the amount of money that can be withdrawn on a single day.

The Greek government may also soon announce a limit on the amount of money that can be moved out of the country.

Those would be dramatic steps to take, but if nothing is done we are likely to watch the Greek banking system die right in front of our eyes.

A Greek exit from the euro seems more likely with each passing day. Such an exit would have a devastating impact on the Greek economy, but it would also dramatically affect the rest of the globe as well. The following is from a recent article by Louise Armitstead….

The Institute of International Finance has estimated that the global cost of a Greek exit could hit €1trillion. When Argentina defaulted in 2001, foreign debtors lost around 70pc of their investments.

That is a big hit for such a little country.

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So what would it cost the globe if Spain or Italy left the eurozone?

That is something to think about.

Meanwhile, the United States continues to steamroll down the same road that Greece has gone. According to the Republican Senate Budget Committee, the U.S. government is currently spending more money per person than Greece, Portugal, Italy or Spain does.

We are spending ourselves into oblivion, and we are heading for a national financial disaster.

Unfortunately, most Americans are totally oblivious to all of this.

Instead of getting educated about the horrific financial crisis heading our way, most Americans would rather read about why Jennifer Lopez is leaving American Idol.

But those who are listening to the warnings will be prepared when the storm hits.

Things in Europe look really, really bad.

You better get prepared while you still can.

This article first appeared here at the Economic Collapse.  Michael Snyder is a writer, speaker and activist who writes and edits his own blogs The American Dream and Economic Collapse Blog. Follow him on Twitter here.

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