Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
The Only Thing Systematic Is The Destruction Of America - 29th Sep 20
Fractional-Reserve Banking Is The Elephant In The Room - 29th Sep 20
Gold And Silver Follow Up & Future Predictions For 2020 & 2021 – Part I - 29th Sep 20
Stock Market Short-term Reversal - 29th Sep 20
How Trump co-opted the religious right and stacked the courts with conservatives - 29th Sep 20
Which RTX 3080 GPU to BUY and AVOID! Nvidia, Asus, MSI , Palit, Gigabyte, Zotac, MLCC vs POSCAPS - 29th Sep 20
Gold, Silver & HUI Stocks Big Pictures - 28th Sep 20
It’s Time to Dump Argentina’s Peso - 28th Sep 20
Gold Stocks Seasonal Plunge - 28th Sep 20
Why Did Precious Metals Get Clobbered Last Week? - 28th Sep 20
Is The Stock Market Dow Transportation Index Setting up a Topping Pattern? - 28th Sep 20
Gold Price Setting Up Just Like Before COVID-19 Breakdown – Get Ready! - 27th Sep 20
UK Coronavirus 2nd Wave SuperMarkets Panic Buying 2.0 Toilet Paper , Hand Sanitisers, Wipes... - 27th Sep 20
Gold, Dollar and Rates: A Correlated Story - 27th Sep 20
WARNING RTX 3080 AIB FLAWED Card's, Cheap Capacitor Arrays Prone to Failing Under Load! - 27th Sep 20
Boris Johnson Hits Coronavirus Panic Button Again, UK Accelerting Covid-19 Second Wave - 25th Sep 20
Precious Metals Trading Range Doing It’s Job to Confound Bulls and Bears Alike - 25th Sep 20
Gold and Silver Are Still Locked and Loaded… Don't be Out of Ammo - 25th Sep 20
Throwing the golden baby out with the covid bath water - Gold Wins - 25th Sep 20
A Look at the Perilous Psychology of Financial Market Bubbles - 25th Sep 20
Corona Strikes Back In Europe. Will It Boost Gold? - 25th Sep 20
How to Boost the Value of Your Home - 25th Sep 20
Key Time For Stock Markets: Bears Step Up or V-Shaped Bounce - 24th Sep 20
Five ways to recover the day after a good workout - 24th Sep 20
Global Stock Markets Break Hard To The Downside – Watch Support Levels - 23rd Sep 20
Beware of These Faulty “Inflation Protected” Investments - 23rd Sep 20
What’s Behind Dollar USDX Breakout? - 23rd Sep 20
Still More Room To Stock Market Downside In The Coming Weeks - 23rd Sep 20
Platinum And Palladium Set To Surge As Gold Breaks Higher - 23rd Sep 20
Key Gold Ratios to Other Markets - 23rd Sep 20
Watch Before Upgrading / Buying RTX 3000, RDNA2 - CPU vs GPU Bottlenecks - 23rd Sep 20
Online Elliott Wave Markets Trading Course Worth $129 for FREE! - 22nd Sep 20
Gold Price Overboughtness Risk - 22nd Sep 20
Central Banking Cartel Promises ZIRP Until at Least 2023 - 22nd Sep 20
Stock Market Correction Approaching Initial Objective - 22nd Sep 20
Silver Bulls Will Be Handsomely Rewarded - 21st Sep 20
Fed Will Not Hike Rates For Years. Gold Should Like It - 21st Sep 20
US Financial Market Forecasts and Elliott Wave Analysis Resources - 21st Sep 20
How to Avoid Currency Exchange Risk during COVID - 21st Sep 20
Crude Oil – A Slight Move Higher Has Not Reversed The Bearish Trend - 20th Sep 20
Do This Instead Of Trying To Find The “Next Amazon” - 20th Sep 20
5 Significant Benefits of the MT4 Trading Platform for Forex Traders - 20th Sep 20
A Warning of Economic Collapse - 20th Sep 20
The Connection Between Stocks and the Economy is not What Most Investors Think - 19th Sep 20
A Virus So Deadly, The Government Has to Test You to See If You Have It - 19th Sep 20
Will Lagarde and Mnuchin Push Gold Higher? - 19th Sep 20
RTX 3080 Mania, Ebay Scalpers Crazy Prices £62,000 Trollers Insane Bids for a £649 GPU! - 19th Sep 20
A Greater Economic Depression For The 21st Century - 19th Sep 20
The United Floor in Stocks - 19th Sep 20
Mobile Gaming Market Trends And The Expected Future Developments - 19th Sep 20
The S&P 500 appears ready to correct, and that is a good thing - 18th Sep 20
It’s Go Time for Gold Price! Next Stop $2,250 - 18th Sep 20
Forget AMD RDNA2 and Buy Nvidia RTX 3080 FE GPU's NOW Before Price - 18th Sep 20
Best Back to School / University Black Face Masks Quick and Easy from Amazon - 18th Sep 20
3 Types of Loans to Buy an Existing Business - 18th Sep 20
How to tell Budgie Gender, Male or Female Sex for Young and Mature Parakeets - 18th Sep 20
Fasten Your Seatbelts Stock Market Make Or Break – Big Trends Ahead - 17th Sep 20
Peak Financialism And Post-Capitalist Economics - 17th Sep 20
Challenges of Working from Home - 17th Sep 20
Sheffield Heading for Coronavirus Lockdown as Covid Deaths Pass 432 - 17th Sep 20
What Does this Valuable Gold Miners Indicator Say Now? - 16th Sep 20
President Trump and Crimes Against Humanity - 16th Sep 20
Slow Economic Recovery from CoronaVirus Unlikely to Impede Strong Demand for Metals - 16th Sep 20
Why the Knives Are Out for Trump’s Fed Critic Judy Shelton - 16th Sep 20
Operation Moonshot: Get Ready for Millions of New COVAIDS Positives in the UK! - 16th Sep 20
Stock Market Approaching Correction Objective - 15th Sep 20
Look at This Big Reminder of Dot.com Stock Market Mania - 15th Sep 20
Three Key Principles for Successful Disruption Investors - 15th Sep 20
Billionaire Hedge Fund Manager Warns of 10% Inflation - 15th Sep 20
Gold Price Reaches $2,000 Amid Dollar Depreciation - 15th Sep 20
GLD, IAU Big Gold ETF Buying MIA - 14th Sep 20
Why Bill Gates Is Betting Millions on Synthetic Biology - 14th Sep 20
Stock Market SPY Expectations For The Rest Of September - 14th Sep 20
Gold Price Gann Angle Update - 14th Sep 20
Stock Market Recovery from the Sharp Correction Goes On - 14th Sep 20
Is this the End of Capitalism? - 13th Sep 20
The Silver Big Prize - 13th Sep 20
U.S. Shares Plunged. Is Gold Next? - 13th Sep 20
Why Are 7,500 Oil Barrels Floating on this London Lake? - 13th Sep 20
Sheffield 432 Covid-19 Deaths, Last City Centre Shop Before Next Lockdown - 13th Sep 20
Biden or Trump Will Keep The Money Spigots Open - 13th Sep 20
Gold And Silver Up, Down, Sideways, Up - 13th Sep 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Euro Crisis: Plight of the Netherlands, Staggering Unemployment in Spain and Greece

Economics / Eurozone Debt Crisis Mar 18, 2012 - 06:22 AM GMT

By: Bob_Chapman

Economics

Best Financial Markets Analysis ArticleA report by the London-based Lombard Street Research, which says the Netherlands is badly handicapped by euro membership, and as a result the Dutch Freedom Party has called for a return to the Guilder. Leader Geert Wilders has become the first political movement in the euro zone with a large popular base to opt for withdrawal from the single currency. The Freedom Party is a conservative populist party. We do not read Dutch, but the very fact that this information was only picked up by a few sources outside of the Netherlands shows you what managed news is all about.


Needless to say, the Hague disagrees with the report, which puts the cost for subsidizing and bailing out of the six nations in trouble at $3.2 trillion. We set the costs months ago at $4 to $6 trillion. Mr. Wilders’ answer is if they disagree with the report, why don’t they have the guts to hold a referendum? Let the Dutch people decide.

The report says as we have said so often, that the euro zone cannot survive in its current form. Dealing this year with Ireland, Portugal and Greece should be relatively easy by letting them slide away. Spain and Italy have partially been shunted aside and by the time they are dealt with they will be even weaker than they are now. The socialist mind set is to push problems into the future, which only worsens the problems. The big question is will Europe strive for world government and allow it to thoroughly destroy the EU financially and economically?

The stark costs in Holland have been easy to appreciate. Over the past ten years its growth rate fell from 3% over the preceding 20 years to 1.25% under the euro, versus 2.25% in Sweden and 1.75% in Switzerland. Their inflation has been lower and prosperity greater. They also created more jobs then Holland and Germany. Of course, the bought and paid for one-worlders in The Hague, and Berlin ignore all that. All they can think of is the 4th Reich. The EU and the euro zone were set up to accomplish this and to subsidize the six sovereigns who were living lives far beyond their means.

The exercise we just saw in Greece was another holding action to buying more time as the conditions in all of the weak sovereigns continues to deteriorate. We see Greece, Portugal and Ireland probably leaving the euro zone, exiting the euro, defaulting and leaving a trail of financial rubble behind. That is good and bad. The good part is they have been dispensed with and are no longer an official liability, on the other part the solvent nations, such as Holland, are left holding massive worthless debt. Our answer is they should have thought about that year’s ago.

As we stated so often over the years one interest rate can never serve all. The south was allowed to borrow too cheaply and too much. That is the main reason for the euro zone’s failure. It was apparent a few years ago trouble was on the way when a number of nations’ citizens voted against a European Constitution, but their bought and paid for representatives, who serve the ruling class not the people, overrode them. Patience of the electorate has worn thin and we can only see radical change ahead.

This has forced Dutch PM Mark Rutte to demand budget cuts in southern Europe, which do little good, because few are listening. He has to cut the Dutch budget about $12 billion, which is equal to 1.5% of GDP to hold up the ratings of all of the participants, except Germany and Finland. Public sentiment to all this is negative and there is now the probability Rutte’s government will collapse. If that happens it could quickly lead to the fall of the euro.

Holland is in its second recession in three years and unemployment has risen to 5%. Consumer confidence is a minus 37, the lowest since 2003. For the 5th year Holland has missed its mandated goal of public debt at 3% of GDP. It is currently about 4.5% in great part the result of bailouts and subsidies to those who are unable to play by the rules.

Dutch debt is rising to 73% of GDP from 69.7%. The EU limit is 60% of GDP. By comparison German debt to GDP is 81.8% and it is 47.2% in Finland.

The solvent countries are paying a terrible personal price to subsidize the southern tier.

How can Greece be better off receiving $25 billion and with more debt and less sovereignty? The citizens are still demonstrating and revenue collections have fallen off a cliff. Greece is still competing on euro terms, which still makes them uncompetitive.

In spite of the CDS market opting for a partial default to save their business we expect the NYC banks to experience much less business. Participation in sovereign debt will simply fall apart and interest rates will not return to lower levels.

Taking up the rear is the IMF, which plans to contribute $30 billion in this second Greek bailout, which is 14% of the total, of which about 19% comes from American taxpayers. That is down from 27% in the first package. Of that $30 billion, $12.7 billion comes from funds left over and not used in the first bailout. Approval may come on March 15th.

The ECB and solvent euro zone countries want excess liquidity drained from the system ASAP. Their finance ministers want to revive debate on a stronger firewall, but that doesn’t seem probable after the German court said that the ESM was unconstitutional.

Complicating matters every couple of weeks a new corruption scandal is uncovered. Not just among Greeks in government, but the German company Siemens was convicted of bribes and paid a fine of $170 million and will have to create 700 new jobs in Greece. In fact the current finance minister Venezelos has been deeply involved in corruption as well, and that goes back many years. We believe the control freaks in northern Europe have finally figured out that there is no way to deal with the Greek culture from a mid-European cultural aspect, or from accepted law. To a more or lesser degree the same thing exists in the other four troubled countries.

As we pointed out earlier Holland’s austerity measures in behalf of bailouts for Greece and others are putting tremendous pressure on their economy.

In 2011 Germany failed to reach its austerity goals and they are behind schedule this year as well. Only 42% of spending cuts named by Mrs. Merkel’s coalition government were implemented. There were $6.16 billion in cuts and that is from a total of $14.7 billion. It’s do as I say not as I do. Of $25.4 billion in savings less than half has become reality. The goal is to eliminate all borrowing by 2020. These rules should have a heavy impact on all EU economies and probably will bring about the purge that is necessary to save what is left of the world financial system.

Just to show you how out of touch with reality euro zone finance ministers are they want to again revive debate on raising the EU firewall backup funds for bailouts. In order to do that Germany would have to amend its constitution. We don’t think the voters will allow them to do that.

At the same time German Finance Minister Wolfgang Schaeuble wants a Europe wide tax on financial transactions. He joins nine other ministers from other countries who want to foist another tax on the citizens of Europe.

The US press gave little or no coverage of a 500,000 person peaceful march in Spain over labor reform, that switches more power to employers and makes it cheaper to fire workers. They marched in 60 cities.

Over in Italy the appointed president Mario Monti is trying to do the same thing as Spain to fatten corporate profits.

All is not always what it seems to be. The CFTC announced that the CME Clearing Europe LTD has vacated the registration of CMECEL, as a derivative’s clearing operation. This has been a very lucrative market for the CME in CDS alone, which is a $50 trillion market. Is that why CME’s CEO Craig Donohue, who is a flamboyant liar has resigned?

The Greek bailout has to stink to high heaven and this move by the CME could be the beginnings of trouble or perhaps even a scandal. At the last minute somehow miraculously the quota was completed at 95% of private participants to get the deal done. Could it be extortion, blackmail and payoffs were employed? If we had to guess we’d say yes. Eventually losses of 74% were taken. On the other hand the real depth of the CDS losses by six NYC money center legacy banks we predict could be close to $30 billion. If that becomes fact, that means those banks, which own the Fed, would have to again be bailed out by the Fed. This could be TARP all over again, but this time the public would have no knowledge of such a bailout until someone goes poking around, like Bloomberg did and finally won their appeal exposing what liars the Fed and its owners are. The Greek debt crisis is not fine and all the top people in the EU are well aware of that. A little bird also tells us some of the private bondholders are taking legal action. It has to be serious when the German Finance minister says, “We must be preparing now, any day, for a third bailout.” The bottom line is Greece has not been saved and the euro is in serious trouble. As we said years ago this unnatural association is doomed to failure. The only question is when does Greece fail? It could be in May or perhaps by the end of the year.

Young people 18 to 25 years old fight wars. Their unemployment across Europe is staggering. That is 49.5% in Spain along with 22% among others. In Greece youth unemployment is 51.1%; otherwise it is 21%. In Greece that is more than 1 million young people and that is up 41% yoy. Only about 4 million people have jobs, or 36.1% of the population of about 11 million. Greece is in depression and they cannot service debt nor roll over existing debt. That means soon they will need more money.

In regard to future bailout funds the French expect a merger of the EFSF when the ESM is approved. The German Federal Court says it is unconstitutional for the German parliament to approve such a measure. Yet, Europe’s one-worlders proceed as if they had never heard of the German Court decision. These people live in a psychotic fantasy world believing only they have the answers.

Theinternationalforcaster.com

Global Research Articles by Bob Chapman

© Copyright Bob Chapman , Global Research, 2012

Disclaimer: The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of the Centre for Research on Globalization. The contents of this article are of sole responsibility of the author(s). The Centre for Research on Globalization will not be responsible or liable for any inaccurate or incorrect statements contained in this article.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

Peter L. Griffiths
12 Apr 12, 12:57
Netherlands Unemployment

The best way to reduce unemployment in the Netherlands would be to give to employers 12 euros for each employee working more than 16 hours during the week. This can be done quite simply through the VAT system.


Anton
12 Apr 12, 18:13
Unemployment in Europe

How about sending all the foreigners home or somewhere else like it was prior to WWI. Yes, WWI, and not the replay known as WWII.


e
12 Apr 12, 23:41
financial transaction tax makes sense

"At the same time German Finance Minister Wolfgang Schaeuble wants a Europe wide tax on financial transactions. He joins nine other ministers from other countries who want to foist another tax on the citizens of Europe."

A tax on financial transactions would be miniscule on the citizens of Europe, affecting mainly highspeed automated transactions and the financial parasites who scam the system and skim profits that should go to the many. A Tobin tax makes sense. Tax the rich. They have the money.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules