The Fate Of Eurozone Bailout May Rest On Slovak Politician Richard Sulik … Merkel And Sarkozy Propose A European Bank Reorganization And A New Vision For Europe

(This article replaces one published earlier this weekend)

Report on the EFSF Monetary Authority as of Sunday October 9, 2011

Henry Chu of The Los Angeles Time report Fate Of Eurozone Bailout Rests On Slovak Politician Richard Sulik  With a vote Tuesday October 11, 2011, in Slovakia on the proposal to aid Greece, Sulik, who has opposed the plan, has the power, some say, to save Europe’s economy or push it over the edge, with global consequences.

Anothy Faiola of The Washington Posts reports Richard Sulik, of the Freedom and Solidarity Party, as saying Our goal here is to prevent the passage of this rescue fund. This country should not have to pay for Greek pensions or French banks.

Nicholas Kulish of the NYT writes Slovakia May Hold Key to Euro Debt Bailout  Bailouts for Greece and other European countries have touched a nerve in Slovakia, which is threatening to derail a rescue plan.

Antonia Oprita of CNBC reports Bail Out Greece? Many Slovaks Don’t Like the Idea‎  The euro has been a disappointment for Anna, who saw prices rise after its introduction and whose job as a cleaner, after a law passed this year to make the Labor Code more flexible, may be at risk. The Slovaks were very proud that they made it into the euro zone in 2009, just when the crisis hit Central and Eastern Europe and ahead of many other countries in the former communist bloc. Ordinary people had a stable currency to rely upon, companies saw their foreign exchange risk eliminated overnight, and politicians were happy that they delivered on their many promises to enter the union. Now the mood has soured, because Slovakia, the euro zone’s second-poorest member after Baltic state Estonia, finds itself in an odd situation: It is being called upon to help bail out much wealthier Greece.

Jan Puhl of Spiege writes in Slovakia Threatens Euro Rescue Package.  A year ago the prime minister and subsequently the parliament rejected calls to provide any financial help for Greece.  Slovakia has put up with painful reforms “without being given a cent,” the prime minister argued back then. But there is more at stake in autumn 2011. If Slovak parliamentarians vote against the new EFSF then the plan to support highly indebted nations will collapse.

The fate of the Eurozone bailout may rest on Slovak politician Richard Sulik, it’s a fluid situation in Slovakia, with negotiations likely running right up until the vote on Tuesday October 11, 2011.

The news reports establish that there is a socio economic chasm between the Greeks and the Slovaks.

Slovaks are of the industrious state, which is characterized by meritocracy and promotes free enterprise. While Greeks are of the olive state, which is characterized by entitlement, and promotes socialism. Obviously, Greeks are not Slovaks, yet they will soon be one, yes living as one, in common debt servitude, under a One Euro Government, as collectivism is the way of the future.

The Eurozone is at a crossroads with the possible failure of the EFSF monetary authority by lack of participation of the Slovaks. Either freedom, sovereign nation states and national currencies will emerge, or diktat, a regional economic government will emerge, and the Euro abide.

Sovereign Armageddon is inevitable. Bix Weir of Road To Roota writes Dexia How Do You Spell “Weapon of Mass Financial Destruction”?  Mr  Weir relates “And so begins the Derivatives Implosion, it’s all about the counter parties and counter party exposure and risk”.  Tyler Durden reports Dexia’s Belgian Bank To Be 100% Nationalized. And he also reminds Dexia was the biggest recipient of the Fed’s taxpayer-funded bailout generosity during the Great Financial Crisis.  Robert Wenzel reports Germany and France stand ready to recapitalize banks and want to do so according to common criteria, Chancellor Angela Merkel said on Sunday, according to Reuters. “We are determined to do the necessary to secure the recapitalization of our banks,” Merkel said at a joint news conference with French President Nicolas Sarkozy in Berlin. “Germany and France want the same criteria to be applied, and criteria that are accepted by all sides,” she said. “We will ask all relevant authorities. to check what we are doing is sustainable.” And she adds, “We are not going into details today, we will present a complete package” for stabilizing the euro zone at the end of the month. Mr. Wenzel comments “This sounds like, as speculated here at EPJ, Greece will go down in a controlled default and a firewall of some sort will be created for all other countries and banks, where all liabilities of banks and countries will be guaranteed by some type of global or EZ entity. The EZ monster is growing. Guarantees don’t come without “supervision”. Reuters reports Sarkozy saying: “We are very conscious that France and Germany have a particular responsibility for stabilizing the euro,” And Athens Report relates Eurozone Endgame “Before The Month Is Over”  Merkel underlined the importance of the Summit of the G-20 leaders in Cannes France, on 3 and 4 November, to be able to present there the “lasting solution” to be accompanied, in the words of Sarkozy, of a “new vision for Europe”.

I believe fate is operating through the 1974 Clarion Call of the Club of Rome to establish regional economic government in all of the world’s ten regions. The emergence of a Ten Toed Kingdom of regional economic government is at hand. A political, not economic solution, is coming to resolve the European sovereign debt crisis. A continental coup d etat is imminent. Since the Greeks and Germans cannot speak with one voice to a common debt plight, a sovereign debt and bank crisis will emerge.

Though an investment flameout, and credit collapse, a new economic and monetary paradigm, construct and matrix will arise to replace Neoliberalism, that being Neoauthoritarianism. It will be characterized by Leaders announcing framework agreements, which waive national sovereignty and establish regional economic government. A Chancellor, that is a Soveign, and a Banker, that is a Seignior, meaning top dog banker who takes a cut, will establish fiscal sovereignty, as well as a new seigniorage, that is a new credit and a new moneyness which will come via diktat. The wold, will and way of the Sovereign and the Seignior will be the law of the land, superseding any national legislature of state constitutional court.

Europeans will no longer be citizens of a sovereign nation state, rather residents living in the EU under regional economic governance, as a true European economic government will emerge. Business leaders and government ministers will promote the interests of state corporatism, as they work for the security and prosperity of the region.

Since the Greeks and Slovaks cannot speak with one voice to a common debt plight, the sovereign will speak for and to those in the Eurozone. He will oversee a EU Fiscal Union. Outgoing ECB Chief, Jean Claude Trichet, on May 31, 2010, in interview with LePost, spoke prophetically of the future:  “We are a federation of money. We now need the equivalent of a fiscal federation in terms of control and monitoring of the implementation of policies on public finances”.

Under Neoauthoritarianism banks will be nationalized.  Banks and government will be one. Banks will be known as the government bank or gov bank for short.  Credit and lending will come through the government.  Companies currently organized and existing as leveraged buyouts, which are traded by the ETF, PSP, will quickly go under, as they will not be able to find rollover financing.  Interest rates will soar and Junk bonds, JNK, fall rapidly in value.

The Sovereign will apply and enforce both austerity measures and debt servitude. Mike Mish Shedlock reports Spain’s net foreign debt exceeds one trillion euros for first time and relates that Spain has 41% of the external debt of the US, on an economy about 9% as big. Does anyone think that will be paid back? When? The debts of Neoliberalism cannot be forgiven. There will be no true debt forgiveness when Greece defaults. Instead the debts of Neoliberalism will be applied to every man, woman and child by the Sovereign and the Seignior.

Governments have been the largest borrowers. And under Neoliberalism they have been the safest clients. The US Federal Reserve, the Central Bank of the United Kingdom, and other central banks, with the exception of the ECB, create money by issuing Government Treasury Notes and Bonds. The creation of government debt is one of the three attributes of sovereign authority, it being able to create money, levy taxes, and declare war. Hence the term sovereign debt.

Treasury debt, as a group, is traded by the ETF, BWX. It has suffered deflation; specifically debt deflation, coming currency deflation beginning in May 2011, as world currencies such as the Australian Dollar, FXA, turned lower on competitive currency devaluation.  The US Soveign Debt is traded by TMF, LBND,  ZROZ, EDV, TLT, and SHY. It has risen as a safe haven from falling currency values, and the European sovereign debt crisis. But now, the interest rate on the ten year US Government Note, $TNX, and the interest rate on the 30 year US Government Bond, $TYX, has been increasing, turning US Government bonds lower. The 10 30 US Sovereign Debt Yield curve, $TNX:$TYX, is now steepening as is seen in the Steepner ETF, STPP, rising and the Flattner ETF,  FLAT, falling. Investors are now acting on the implementation of Operation Twist to sell US Treasuries.  Lee Adler of Wall Street Examiner writes: “Foreign central bank dumping of Treasuries and Agencies reached record levels this week, far beyond anything seen in the 9 years since I started tracking this data. Over the past 9 years, there has never been a time when FCBs were sellers of their Treasury and Agency debt for 4 weeks in a row. I do not believe that the bull market in bonds can survive under these conditions, regardless of what the Fed does. If the runs on European banks, bank paper, and sovereign debt subside, by even a little, it’s over. Thus, it appears that FCBs started selling Treasury securities, even on anticipation of OT”.
I comment that I expect to see M2, as seen in John Williams Shadow Stats and M2 Money Stock M2 in US Federal Reserve turn lower s the Global Government Finance Bubble has been pricked.

Traditionally, the ECB has not monetized public deficits. Instead, Europe has relied on banks and insurance companies to do this. They are required under the law to hold a specific portion of their reserves in the form of government bonds. And in times past the rating agencies were very liberal with the best of ratings, which induces monetization of debt as the ECB now buys sovereign debt.

Monetization of debt has gone viral and the European banks are insolvent and cannot access credit lines with U.S. banks and others as well. A resource that has been keeping these banks afloat has been severed. The European banks are not lending. With the result that a Credit Crisis, specifically a Credit Bust, is imminent, which is going to result in a global economic collapse, and which will be the genesis for regional economic government, as called for by the 300 elites of Club of Rome in 1974.

The Euro, FXE, is a commodity currency, CCX. An inquiring mind asks, when the global economic collapse occurs, and the new moneyness comes, that is the new seigniorage comes, with its value established from diktat, will commodities such as oil, $WTIC, still be traded in US Dollars, $USD, or will alternative currencies emerge?  To this I have no answer.  And will the Dow and Saudi oil company accord for $20B plant abide? To this I have no answer as well.


Keywords: Sovereign Authority, Richard Sulik, Sovereign Armageddon, EFSF, Freedom, Diktat, The Industrious State, The Olive State, Free Enterprise, Entitlement, Socialism, Greek Socialism, Meritocracy, One Euro Government, Debt Servitude, Collectivism, Sovereignty, Seigniorage, The Sovereign, The Seignior, Neoliberalism, Neoauthoritarianism, Ten Toed Kingdom, Coup d Etat, Credit Collapse, Credit Evaporation, Moneynesss, New Moneyness, Fiscal Sovereignty, Fiscal Union, Security And Prosperity, Bank Nationalization, Nationalization of Banks, Government Bank, Gov Bank, Regional Economic Government, European Economic Governance,  Derivatives Implosion, Dexia, Bank Recapitalization, Global Credit, Global Credit Bust, Global Credit Guarantee, Credit Guarantee, Credit, Lending, Club of Rome, New Vision for Europe, The Clarion Call, Debt Deflation, Competitive Currency Devaluation, Monetization of Debt, Debt Monetization, Alternative Currencies, M2, Fiscal Federation, Operation Twist, Sovereign Debt, Deb Forgiveness, Greek Default, Default of Greece,

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