Euro crisis: “this is not a crisis about the euro”

So sayeth the President of the European Council, Herman Van Rompuy, writing in the Guardian.  And he should know!  From the Guardian article

Astonishingly, since our summit the cost of borrowing has increased again for a number of euro area countries. I say astonishingly, because all macro economic fundamentals point in the opposite direction. It cannot be stressed enough that Greece is in a unique situation, not comparable to that of the other eurozone countries. Italy will generate a primary surplus in 2011 and, with the additional austerity package just adopted will have a balanced budget in 2014. Spain has a low debt stock around 70%, below the EU and the euro area average, and has taken courageous measures to reduce its deficit and boost growth. In all these cases, the current market assessment of risks are totally out of line with the fundamentals and it is ludicrous that CDS-rankings put these countries in the top tier of default risk countries.

Finally, it is imperative to bear in mind that this is not a crisis about the euro. In the aftermath of the financial crisis of 2008, all developed countries are faced with increased public debt. Given the interdependence of these economies, as we have clearly seen first hand in the European Union, it is in everyone’s interest that each country should find a solution to this burden, tailored to their own needs, which will have a direct effect on jobs and growth in the coming years.

Astonishingly!  And, of course, moving towards even greater fiscal union had nothing to do with the existential crisis about “an incomplete construct”.  Even if changing the rules raises incredible doubts about your credibility…

[Europe is still sexy! – Ed]  Of course it is.

To be fair, for supporters of the “European Project”, the options are stark.

And when it’s that serious, you have to lie…

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  • Food for thought and tinkering thinkers, Pete/Sluggers

    Pat Gorman: For the best answers to the central banking questions I went to my good friend Sinclair Noe. Sinclair is the author of Eat The Bankers: The Case Against Usury, a must read for anyone trying to understand the banking system and its effects on our economy. Mr. Noe has been filling in for me on my radio show, Hard Money Watch, while I work on getting myself radio-ready again – and he has been doing a great job. Sinclair was also the Master of Ceremony at our Wealth Protection Conference again this year. Sinclair, what say you?

    Sinclair: “Yes. The Internet has given us a window into the historically secretive world of central banking. Remember the Federal Reserve was conceived in secrecy, shrouded in ritualistic mumbo jumbo, and cloaked behind the intentionally indecipherable language of the dismal science. The Creature From Jekyll Island was never meant to be seen in the bright light of the sun. It is more than ironic that Ben Bernanke has recently started to hold press conferences. This is pure theater, but it shows two things: the Fed is getting nervous, and the Fed still thinks they can put on a dog and pony show and hoodwink the masses.”

    Daily Bell: In 2008, people started paying attention to the massive bailouts and they started to seriously question the scam. Where did the bailout money go? How much money was given away? Why hasn’t the Fed ever been audited? What exactly is the Fed? Who does the Fed serve? Why the hell do we need a middleman? What is the moral or legal authority for the central bank? Why did we abandon Article 1, Section 8?

    Pat Gorman: Slowly but surely the light bulbs are starting to come on. People are realizing that the Fed has not added one ounce of value in nearly 100 years and many people now realize we have witnessed the greatest theft in history. The U.S. Treasury was looted. We have seen the greatest redistribution of wealth ever perpetrated. If you want a blueprint for financial corruption, it is the central banking system and the thieves who stand behind it.

    Daily Bell: Is the centralized banking elite in trouble now?

    Pat Gorman: Yes. Any sustainable successful economic system must be based on principles of equity, fairness, justice and opportunity for prosperity. History has proven that systems built on oppression and injustices always fail in time. So, yes central banking is in trouble now but it has been in trouble before.

    Daily Bell: Will central banking continue or will it succumb to public anger?

    Pat Gorman: Change is not always quick and it doesn’t always lead to the results you might expect. You have to remember that the banking cartel is extremely profitable; they can start wars; they manipulate education; they direct the sciences; they purchase and control governments and they own and control mainstream media. The banking system concentrates and places power in the hands of those who control it. It is a tremendous and real advantage to be able to print money out of thin air. While it may be interesting to speculate that the Fed is nervous about transparency damaging their moral authority, the truth is, the Fed never had any moral authority and doesn’t seem particularly interested in morality.

    Public anger can be powerful but fear is also powerful and it is a favorite tool of the elite. They will tell us that the power to print money is too important and too complex to entrust to partisan elected politicians; that the threat of terrorism, crime, and drugs are the reason to surrender our freedoms for the perception of security. They will try to sell us that censorship of the Internet will protect us. Of course we know the old saying, “He who sacrifices freedom for security deserves neither.” I think that came from Ben Franklin and he had another saying, “Time is money.” The longer the banking elite can stall reform, the longer they can profit. There’s another saying, “Don’t fight the Fed;” that probable came from somebody in the Fed, and whenever I hear that I think of the line from the Wizard of Oz: “Pay no attention to the man behind the curtain.….

  • CharlieMcCarthy29

    Full quote(s) from Wiki:

    They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety.

    * This was written by Franklin, with quotation marks but almost certainly his original thought, sometime shortly before February 17, 1775 as part of his notes for a proposition at the Pennsylvania Assembly, as published in Memoirs of the life and writings of Benjamin Franklin (1818). A variant of this was published as:
    o Those who would give up Essential Liberty to purchase a little Temporary Safety, deserve neither Liberty nor Safety.
    + This was used as a motto on the title page of An Historical Review of the Constitution and Government of Pennsylvania. (1759); the book was published by Franklin; its author was Richard Jackson, but Franklin did claim responsibility for some small excerpts that were used in it.
    * An earlier variant by Franklin in Poor Richard’s Almanack (1738): “Sell not virtue to purchase wealth, nor Liberty to purchase power.”

  • aquifer

    Thanks to the Tea Party for reminding us that this can be a problem of the dollar too.

    Being a reserve currency is worth a lot, but would the Europeans pull together to make the Euro one?

    The French and Germans don’t seem that interested, unless that is a negotiating ploy to pressurise the periphery into line.

  • Alias

    He has the eurototalitarian mentality that declaring it so makes it so, and he is accordingly “astonished” when it ain’t so.

    Unfortuantely, the imminent collapse of the Eu regime beneath a pile of debt that its own policies created is now going to have utterly devastating consequences for the nations of Europe, whose impending penury will make the Great Depression look like Nirvana. Soup kitchens will soon be a reality for millions.

    It will also make Ireland look like the Great Famine has revisited it, since the state has used its assets as collateral to borrow money from the eurosystem which is transferred straight back to the eurosystem via debt repayment by eurosystem banks whose debts it has underwritten. There will be nothing left for the state to use as collateral and, ergo, no way for a non-functioning state to feed a starving population.

    Folks have no idea just how much damgage that these deranged europhiles have done to them but they’ll soon find out. Buy gold, et all, before your money becomes worthless.

  • wee buns

    o harbinger of hope and light.
    I sincerely hope you are wrong in the extremity of your predictions. However it is a good idea to try to get ready for serious hardship. Barter will be of great importance, as will medicine and various skills. Also land, where available should be cultivated now.

  • Alias

    Unfortunately, I’m right… and they’re history’s outworkings rather than my predictions. And even if the assets of Germany and france can be used to prop up the euro, the outcome for Irish people will also be penury within a (saved) EU.

    Remember that the Irish borrowed half a trillion euros which they converted into property that is now worth circa 30% of what was paid for it. Even if they sold every property to a foreign investor, they would still have a shortfall of 70% or circa 350 billion. As they owe the full 500 billion, they are going to have to generate the other 350 billion from assets other than the devalued property.

    In other words, every cent in wealth that business folks in the state could possibly generate in a decade must be extracted from the economy and exported to foreign eurosystem banks as debt repayment. History, however, has no precedent for that extreme level of extraction of wealth and resources, but you can be sure that it is going to return the Irish to a standard of living they last enjoyed a few centuries ago.

  • CharlieMcCarthy29

    …you can be sure that it is going to return the Irish to a standard of living they last enjoyed a few centuries ago..

    Come, come Alias. Your posts can be interesting though sometimes they border the paranoid. This is such a one. No country is going back to a standard of living that you suggest. There will be revolutions well before that and the attempt by the masters of the universe to rob the peasantry will come to naught.