Best of the Week
Most Popular
1.RED ALERT: Paris Terror Attacks - What to Expect Next - STRATFOR
2.Paris Terror Attacks, Death Pangs of a Dying Religion, and Impact on BrExit EU Referendum - Nadeem_Walayat
3.Paris Terror Attacks, Islamic State Attempting to Spark Civil War in France - Nadeem_Walayat
4.Three Shocking Charts That Prove Gold Price Rally Is Coming - Sean Brodrick
5.Stock Market Nifty-Fifty Becomes Fab-Five; Return of the 'Four Horseman' - Mike_Shedlock
6.Africa Population Explosion - Why Europe's Migrant Crisis is Going to Get A Lot Worse - Video - Nadeem_Walayat
7.Gold Mining Stocks May Be The Buy Of The Century - Jeff_Berwick
8.Grandmaster Putin Beats Uncle Sam at His Own Game - Mike_Whitney
9.BRICS? No, CRISIS - Raymond_Matison
10.UK Housing Market Affordability, House Prices Momentum and Trend Forecast - Nadeem_Walayat
Last 5 days
George Osborne's War on Buy to Let Sector Trending Towards Doomsday - 26th Nov 15
Will Turkey Drag NATO into War With Russia in Syria? - 25th Nov 15
George Osborne’s Autumn Statement and Spending Review Full Text - 25th Nov 15
Will Fresh QE From ECB Boost Gold? - 25th Nov 15
Sheffield, Yorkshire and Humberside House Prices Forecast 2016-2018 - 25th Nov 15
Investors Watch Out For The Auto Industry… - 24th Nov 15
BEA Revises 3rd Quarter 2015 US GDP Economic Growth Upward to 2.07% - 24th Nov 15
Stock Market Supports Are Being Broken - 24th Nov 15
Is Gold Price on the Verge of a Breakout? - 24th Nov 15
Fed’s Tarullo: U.S. Interest Rates Liftoff Should Wait for Signs of Inflation - 24th Nov 15
Silver Price, COT, US Dollar Updates and More - 24th Nov 15
UK Regional House Prices Analysis - Video - 23rd Nov 15
Crude Oil Swinging For The Fences - A 20 to 1 Option Play - 23rd Nov 15
US Dollar, CRB, Oil, Gas, Copper and Gold - The Chartology of Deflation - 23rd Nov 15
UK Regional House Prices, Cheapest and Most Expensive Property Markets - 23rd Nov 15
Stock Market Rally Losing Momentum? - 23rd Nov 15
Will Gold Price Drop Below $1000 Soon? - 23rd Nov 15
Gold and Silver Sector Big Green Light and Low Risk Entry Setup... - 23rd Nov 15
Limits to Economic Growth - Challenge and Choices - 22nd Nov 15
Long Dollar Trade and Current Copper Price Below Cost of Production - 22nd Nov 15
UK Housing Market House Prices Affordability Crisis - Video - 21st Nov 15
The Fed Has Set the Stage for a Stock Market Crash - 21st Nov 15
Stock Market Primary V Wave Continues - 21st Nov 15
Gold And Silver - Value Of Knowing The Trend - 21st Nov 15
UK Footsie Bulls Set To Foot The Bill - 21st Nov 15
UK Housing Market Affordability, House Prices Momentum and Trend Forecast - 21st Nov 15
GDX Gold Miners’ Strong Q3 Results - 20th Nov 15
End of Schengen, Stock Market’s Technical Strength Grows - 20th Nov 15
Justice for All and The Curious Case of Zambia - 20th Nov 15
Paris, Sharm el-Sheikh, and the Resurrection of Old Europe - 20th Nov 15
Silver Prices and The Management of Perception - 20th Nov 15
Stock Market Nifty-Fifty Becomes Fab-Five; Return of the 'Four Horseman' - 20th Nov 15
Waiting for Goldot Again - 20th Nov 15
Michael Curran Goes Down-Market Shopping for Gold Stock Winners - 20th Nov 15
Why Isn’t This Incredibly Bearish Bond Market Development Making the News? - 19th Nov 15
SPX Appears to have Stopped its Rally - 19th Nov 15
The Great Fall Of China Started At Least 4 Years Ago - 19th Nov 15
Using Elliott Waves: As Simple As A-B-C - 19th Nov 15
Has Deflation Been Ddefeated? - 19th Nov 15
Dow Jones Stock Market Index is Not Going to Crash - 19th Nov 15

Free Instant Analysis

Free Instant Technical Analysis

Market Oracle FREE Newsletter

Reasons to Get Excited About Japanese Stocks

Elites Deterrence is Dead

Politics / Eurozone Debt Crisis May 19, 2012 - 11:42 AM GMT

By: Ashvin_Pandurangi


Best Financial Markets Analysis ArticleWith Greece potentially on the brink of exit from the Eurozone before year's end, a lot of analysis out there has turned to what the consequences of such an event would be, and, specifically, what punishment Greece would receive from the EU and other international organizations, such as the IMF and perhaps even NATO. The general line of thinking here is that Europe will make such a devastating example out of Greece that no one else will dare to question the status quo setup ever again. While Greece is dragged down the Green Mile in shackles to its final destination, all the other prisoners will watch with an unmistakable sense of dread, and the ceiling lights will ominously flicker as the "juice" is turned on, electro-frying Greece into a crispy black corpse.

October 23, 1909. New York. "Duelling with wax bullets." Paintball 1.0. 5x7 glass negative, George Grantham Bain Collection.

In a recent Telegraph article by Ambrose Evans-Pritchard, the views of analysts at Bank of America and HSBC are outlined, and they just so happen to fit in very nicely with the above narrative (one that will only become more common in the coming weeks). First, they say that global markets will rally on a Greek exit due to the massive response it precipitates by the ECB, Fed, BOJ, EU and other Eurozone governments - coordinated currency swaps, ECB interest rate cuts, ECB QE, Fed QE, SMP purchases of Spanish and Italian bonds, capital injections into Euro area banks and a "pan-European system of deposit guarantees", among other things.

They are relying on the quite cliched argument that BAD = GOOD in this market system, since the centralized authorities will unleash every tool at their disposal when the going gets rough. The other critical part of this bankster-floated narrative is that the Euro area will become better, faster and stronger once Greek is thrown overboard and left as chum for the sharks. Not only will the central institutions manage to prevent systemic contagion via the tools listed above, but the remaining member states will be scared shitless and will therefore do whatever they are told to do in exchange for remaining shackled to the new and improved Eurozone.

Here is a short passage from the Evans-Pritchard article (he is referencing the views of David Bloom, currency chief at HSBC):

Global banks see market rally on Greek exit

Mr Bloom said the ECB is playing a game of chicken by waiting until it has secured maximum compliance from EMU's wayward states before coming to the rescue. "Once again it is holding everybody over the edge of the abyss until they scream for mercy," he said.

A currency union without the encumbrance of Greece would be viewed as a stronger bloc by investors, but much would depend on events in Greece itself.

If a return to the drachma proved to be a "ruinous experience" for the Greeks – as HSBC expects – if would mightily deter Portugal, Spain, and other from such temptation.

The worst outcome for euro and monetary union would be a double whammy where the authorities fail to control EMU-wide contagion, yet Greece somehow manages to claw its way out of crisis and make a success out of a devalued sovereign currency, as Argentina did after breaking the dollar-peg in 2002.

The world according to HSBC is simple here - the European people are destined to wake up from the EU nightmare if Greece exits and manages to do well for itself (naturally), especially if the other Eurozone members follow in its footsteps and start planning for a new, anti-Euro, anti-bankster beginning. In order to avoid such a pleasant outcome, Europe must hope that both financial and psychological contagion is squashed immediately by the globalist institutions, and Greece is kicked in the skull so hard and so swiftly that it never recovers from the blow. Banks like BoA and HSBC want the head of Alexis Tspiras on a pike, bandied about from country to country as a stark reminder not to cross the callous elites whom they serve, and they also want everyone else to believe such tactics will be effective as the Final Deterrent.

I am here to remind you, though, that the reality of our situation is NOT what they would have you believe. Their arguments may be convincing when framed in a world of stability and expansion, but they completely break down in our current era of instability and contraction. The functions of Michel Foucault's "discplinary society" and Guilles Delueze's "control society" are rapidly becoming obsolete, as the institutions of global society can no longer leverage and arbitrage the peoples' fear and willful ignorance against them. In short, and for all practical purposes, the large-scale civilization's strategy of achieving conformity and normalcy through deterrence is dead.

When the Greek people finally exit the EZ, and if/when they are made to SUFFER at the Cross for their "sins", the Spaniards, Italians, Portuguese and Irish (and eventually, the French, British, Germans, Americans) will look on and realize that the Cross is not such a bad fate when compared to the tons of flesh that will be demanded by the globalist elites in perpetuity. In the short-term, it is quite possible that the bankster propaganda-and-punishment cycle succeeds in quelling further internal dissent within the Eurozone, but any such success will amount to nothing more than castles made of sand on the shores of a ravaging sea. As the tides of popular resistance continue to turn and grow with force, these castles will eventually crumble.

The Spanish are already suffering unemployment rates just as severe as those of Greece (25% of population, 50%+ of youth population), and their economy has been locked out of credit markets at just about every scale (households, businesses, regional governments). When Greece is ousted and the Eurocrats ride in to Madrid on their white steeds with promises of conditional backstops and bulletproof memorandums, it will be almost too late. No one will believe that the Powers That Be in Europe can do anything more for the people of Spain than they did for the people of Greece (bankrupt them and leave them to die).

This death of deterrence is as clear in the criminal justice system of the developed world as it is in the economic and geopolitical spheres of the Eurozone. Once a large enough portion of a population has been financially, socially and psychologically reduced to rubble, it becomes exponentially more difficult to scare it back into "playing by the rules". I mentioned in the TAE comment forum that the death penalty does not act as much of a deterrent to criminals in U.S. states which also carry the penalty of life in prison without parole (an assertion that has been studied to death by criminologists), but this issue goes much deeper than that.

The threat of state and/or federally-sanctioned punishment in EVERY realm of society is losing its credibility as time goes on and the pain of the disenfranchised masses festers like an untreatable infection. This is why Iran will never back down from their ability to pursue nuclear energy/weapons technology in the long-term, no matter how many theaters of war the Western powers decide to open up in the Middle East. It is why the growing police states in the West will always encounter some significant force of resistance, no matter how many people they assassinate or imprison without due process in FEMA camps or other pre-planned destinations. Yes, there will no doubt be many people who end up submitting to status quo out of fear (perhaps a status quo disguised as "something else"), and will continue to actively or passively support it.

Still, it is undeniable that a percentage of the masses will choose to defect/resist - a percentage that will surely make the globalists quiver in thier boots - because the other choices they are left with are dreadful and degrading beyond imagination. This is also why the Cold War era, game-theoretical fantasy of Mutually Assured Destruction will no longer function coherently in the near future. That is a scary prospect, but one that we must learn to live with. When pushed into extreme situations, and backed into corners with no apparent way out, people will resort to desperate and extreme measures for their perceived survival.

It is all part and parcel of an industrial, imperial, global capitalist system that has entered its terminal stages of decline - stages which will present us with grave threats, frightening prospects and unique opportunities. The traditional deterrence narratives spun by the elites will only work for as long as we choose to empower them; to validate them as persuasive arguments (like AEP does), rather than the putrid propaganda that they really are. Banks like BoA and HSBC, and, lately, analysts such as AEP, have been thoroughly immersed in this global propaganda campaign being waged for ALL the marbles, whether they know it or not (I suspect many of them do).

We must recognize, point out and discredit their myths every chance we get, because they already gained a huge head start in embedding them within our political culture. If we choose to believe that minority pockets of people on this Earth hold unparalleled amounts of power over individuals, families, communities and societies, then they will keep us deterred from freedom until it is much too late. But the reality that the elites want to see materialize is NOT the reality that they will get - if only we remember to always accept the truth and reject everything else which sullies its name.

Ashvin Pandurangi, third year law student at George Mason University
Website: (provides unique analysis of economics, finance, politics and social dynamics in the context of Complexity Theory)

© 2012 Copyright Ashvin Pandurangi to - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

© 2005-2015 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

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

Biggest Debt Bomb in History