Eurozone Sovereign Debt Shocks And US Quantative Easing Have Light The Fuse For Götterdämmerung

I … Leigh Phillips in EUObserver reports Van Rompuy Warns EU Is In Survival CrisisEU Council President Herman Van Rompuy has warned that the eurozone and the European Union itself are fighting for their life as a result of the ongoing sovereign debt shocks, most recently in Ireland and Portugal.

“We’re in a survival crisis,” the president told an event at a Brussels think-tank on Tuesday morning (16 November) ahead of a meeting of finance ministers from countries that use the euro, where it is expected that they will interrogate Ireland and Portugal over the state of government finances.

Mr Van Rompuy warned that if the eurozone does not survive, neither will the EU. “We all have to work together in order to survive with the eurozone, because if we don’t survive with the euro zone we will not survive with the European Union,” he said. “But I’m very confident we will overcome this,” he added.

In related news, Austria has said it would block another tranche of cash to Greece after EU data published on Monday revealed that Athens had incurred a much larger budget deficit and levels of public debt than the country had earlier estimated.

EU audit figures showed that the Greek government budget deficit for 2009 amounted to 15.4 percent of gross domestic product, sharply up on Athens’ earlier estimate of 13.6 percent.

“The statistics give no reason to hand over the money from an Austrian point of view,” the conservative People’s Party leader and finance minister Josef Proell said. He explained that Greece no longer meets the requirements to access the €190 million in credits Austria would otherwise be due to hand over as part of a €110 billion EU-IMF-ECB bail-out of the country agreed in May this year.

Some economists are not so sure whether the EU will “overcome” the financial crisis, as Mr Van Rompuy believes.

II … For historical insight, 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.

 

III … 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 of Revelation 13:5-10,  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 of Revelation 13:11-18 … 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: The eurozone bail-out for Greece has begun to unravel after Austria suspended aid contributions over failure to comply with the rescue terms, and Germany warned Athens that its patience was running out. The clash caught markets off-guard and heightened fears that Europe’s debt crisis may be escalating, with deep confusion over the Irish crisis as Dublin continues to resist EU pressure to request its own rescue. Olli Rehn, the EU economics commissioner, said escalating rhetoric in Europe was turning dangerous. “I want to call on every responsible European to resist the centrifugal tendencies and existential alarmism.” ….. And yet again, The Seignior might be the co-chair of the Council on Foreign Relations, the CFR, Robert Rubin, who was Treasury Secretary. He is shown in a 1995 photo by Stephen Crowley of The New York Times, with Alan Greenspan, who was Federal Reserve Chairman, at a House Hearing, in The New York Times article The Reckoning Taking Hard New Look At A Greenspan Legacy by Peter S. Goodman, who said of Alan Greenspan: “And his views held the greatest sway in debates about the regulation and use of derivatives, exotic contracts that promised to protect investors from losses, thereby stimulating riskier practices that led to the financial crisis. For more than a decade, Alan Greenspan has fiercely objected whenever derivatives have come under scrutiny in Congress or on Wall Street. He related: “What we have found over the years in the marketplace is that derivatives have been an extraordinarily useful vehicle to transfer risk from those who shouldn’t be taking it to those who are willing to and are capable of doing so,” Mr. Greenspan told the Senate Banking Committee in 2003. “We think it would be a mistake” to more deeply regulate the contracts, he added.

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”.

IV. The global bond and currency traders are now in control of the world’s financial markets.

The bond traders have seized control of both long-term interest rates, such as the Interest Rate on The US 30 Year Government Bond, $TYX, the rate on corporate and European sovereign debt, and short term rates that were formerly under the control of the central bankers.  Joe Weisenthal reports Mortgage Rates Just Hit A Four-Month High; his chart shows an explosive jump in mortgage rates in just the last few days. This on the market conviction that the debt of Portugal, Italy, Ireland, Grece and Spain cannot be repaid, and on the conviction the Ben Bernanke US FOMC announcement of Quantative Easing constitutes monetization of debt.

The currency traders have established themselves as the world’s sovereign governing power; their rule over the world governments began on November 5, 2010 when the Interest Rate on the 30 Year US Government Bond, $TYX, sustained above 4%, and as they sold the major currencies, DBV, and emerging market currencies, CEW, which called the US Dollar, $USD,  for now higher.

I appreciate those who have given their time to document the damage coming from Quantitative Easing. Their reports are both awakening and sobering.

Gary Dorsch, Editor, Global Money Trends Crossing The Rubicon Into The World Of QE-2

Chris Martenson, QE II Has Lit the Fuse

Doug Noland, Prudent Bear, The Official Start Of QE 2

Greg Hunter, USA Watchdog, Insanity Or Ingenious?

Paul J. Lim, New York Times, A Calmer Market? Not For Long Bonds

Mary Williams Walsh, New York Times, Municipal Bond Market Shudders

Keywords: quantativeeasing

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